Presented By:

• Abhishek Bhartiya• B. Aditya Mohan• Geetika Sodhi• Mahek Nangia• Mukul Kumar• Wasim Shaikh

Marketing MixFor

Introduction

• Total Revenue for McDonald’s India in 2006-07 was $740.2 million.

• Estimated CAGR of 40 percent.

• Rs 400 crores being put in for expansion plans into Tier II cities within next three years.

• Doubling of turnover within three years.

• Market share of 18 percent in north India.(includes restaurants, cafes, fast food joints, local vendors etc.)

• McDonald’s is the Eighth Most Poweful Brand in the World. ----Source: Millward Brown Optimor (including data

from brandz, Datamonitor, and Bloomberg)

Brief History

• McDonald's was started as a drive-in restaurant by two brothers, Richard and Maurice McDonald in California, US in the year 1937.

• By mid-1950s, the restaurant's revenues had reached $350,000.

• Ray Kroc, distributor for milkshake machines, expressed interest in the business, and he finalized a deal for franchising with the McDonald brothers in 1954.

• He established a franchising company, the McDonald System Inc. and appointed franchisees.

• In 1961, he bought out the McDonald brothers' share for $2.7 million and changed the name of the company to McDonald's Corporation. In 1965, McDonald's went public…

McDonald’s In India

• In 1996, first McDonald’s restaurant opened on Oct. 13, at Basant Lok, Vasant Vihar, New Delhi.

• McDonald's India is a 50 – 50 JV partnership between McDonald’s Corporation (U.S.A) and two Indian businessman Amit Jatia (Hardcastle Restaurants Private Limited, Mumbai) and Vikram Bakshi (Connaught Plaza Restaurants Private Limited, Delhi).

• Approximately 75% of the menu available in McDonald’s in India is Indianized and specifically designed to woo Indian customers.

• The McDonald's philosophy of QSC&V is the guiding force behind its service to the customers.

Product

“Our clear strategy is to bring the customers in initially and provide a range of entry-level products so that they can try new items and graduate to the higher rungs.” ---

Vikram Bakshi, Managing Director,

Northern Region, India

Product Mix

Product Mix

Veg Menu Non-Veg Menu

Beverages Frozen Deserts

• McVeggie™• McAloo Tikki™• Paneer Salsa Wrap • Crispy Chinese • Veg McCurry Pan™• Pizza McPuff™

• Chicken Maharaja Mac

• McChicken• Fiet-O-Fish• Chicken Mexican

Wrap• Chicken McGrill

• Cold Coffee• Ice Tea• Soft Drinks• Mc Shakes• Hot Serves

• Soft Serve Cone• Mc Swirl• Soft Serve• Flavor Burst• Floats

Veg Menu

Non-Veg Menu

Beverages

Frozen Deserts

Break fast Menu

• Usual working hours: 11am to 11pm

• Recently came up with new timings: 7am to 11pm

• Only available in selected outlets.

• Introduced egg on the menu for breakfast

Packaging and Labeling

Clearly mentions that the burger

is a Veg or a Non-Veg Burger

Mentions the name of the

burger and the colour is

different for different types

of burgers

Co - Branding

McDonald’s has major tie-ups with various companies as their co-branding Statergy.

Few of Them are listed Below:

Coca-Cola

Barbie

Hotwheels

Cadbury

Pricing

• Initial focus on metros – Mumbai and Delhi.

• Relatively high income.

• Move to smaller satellite towns.(Gurgaon and Pune)

• Jaipur and Agra – to attract foreign tourists.

Household Expenditures

Source: India, the structure of Poverty, WORLD RESOURCE INSTITUTE.

Purchasing power pricing:-

a) In 1997 slashed prices for vegetable nuggets and

soft serve cone.

b) In September 2001, they offered Veg surprise

burgers for Rs 17.

c) March 2004 – Aap ke zamane mein, baap ke

zamane ka daam.

Pricing Stratergy

Pricing Stratergy

Value Ladder strategy :-a) Started offering value meals in a range of prices.b) Ensure affordability and attract widest section of

customers.c) Brought the customer and provided a range of entry-

level products.d) Try those new items and graduate to higher-rungs.e) E.g- if a customer starts with McAloo Tikki, he will

finally graduate to McVeggie and so in Non veg.f) Helped its Volume business.

Aap ke zamane mein, baap ke zamane ka daam!!!

Value Pricing.

a) Happy price menu – Rs 20.

b) Economeal – Rs 49(save Rs 11).

c) McChicken & McVeggie Meal – Rs 75,Rs 65 (Save Rs 15).

d) Happy Meal for Kids – Rs 69,99,109 (toy free).

e) Big saving Meals – Combos Rs 109 – Rs 119(Save Rs 36).

f) A-la carte menu – Rs 45- Rs 65 (Veg)

Rs 55- Rs 65 (Non Veg)

g) Desserts – Rs 12 – Rs 25.

h) Beverages – Rs 25- 50 ( a little costly)

Package deal.

• The most common startegy in fast food industry.

• The most preferred style for customers of McD.

• Plays on Psychological factor of the customer.

• Customer acquisition costs are high.

• Consumers appreciate the resulting simplification of the

purchase decision.

• The product mix offers are different in various parts of

India.

Product Bundling

80-20 Menu Board

• 80% visual.

• 20% descriptive.

• Easier for customers to understand what

29,39,49,59,89,99 rupee options are.

• Pricing range, quick service, no-tips

environment attracted middle class and

students.

Food items

McD SUBWAY KFC PIZZAHUT DOMINO’S

Burgers & Pizzas

Rs 20- Rs 70

Rs 65- Rs 135

Rs 25 – Rs175

Rs 55- Rs 175

(regular)

Rs 35- Rs 140

(regular)

Combo Meals

Rs 49-Rs 119

Rs 45- Rs 175

Rs 55-Rs 150

Rs 120- Rs 250

Rs 120- Rs 230

Beverages Rs 25- Rs 50

Small-300ml

Rs 35- Rs 45

Small-300ml

Rs 30-Rs 55

Small-300ml

Pet beverage

MRP(600 ml)

Rs 30 (600 ml)

Desserts Rs 12-Rs 25

Rs 20-Rs 50

Rs 15-Rs 65

Rs 40- Rs 60

Rs 25 (100ml cup of Baskin

Robbins)

Competitive Pricing

Sustaining – HOW?

Cost control strategy:-

a) Well established low –cost

supply chain.

b) Ensures efficiency and speed

in distribution.

c) Huge increase in volume

sales.

d) Very good food processing

technology.

McDonald’s : A locally Owned Company

McDonald’s India Pvt.

Ltd.

McDonald’s Corporation

Hard Castle Rest. Pvt. Ltd.

(West & South)

Connaught Plaza Rest. Pvt.

Ltd.(North & East)

Geographically Diverse suppliers: Ensuring stringent quality standards

McDonald’s : A locally Owned Company

McDonald’s India: Suppliers

• Trikaya AgricultureSupplier of Iceberg Lettuce

• Vista Processed Foods Pvt. Ltd.Supplier of Chicken and Vegetable range of products.

• Dynamix DiarySupplier of Cheese.

• Amrit FoodSupplier of long life UHT Milk and Milk Products for Frozen Desserts.

McDonald’s India: Suppliers

SELECTION

MOTIVATION

EVALUATION

MODIFICATION

McDonald’s India: Distribution

Radhakrishna FoodlandDistribution Centres and cold storages.

“With a cold chain in place there is practically no need for a knife in the restaurant. Chopping and food processing is done in plants. Restaurants are confined only to actual cooking” – Amit Jatia.

• Completely dedicated distribution and supply chain.

• Matching supplier production with deliveries using ERP.

• Quality inspection Program, quality check at 20 different points in supply chain.

• HACCP(Hazard analysis critical control points) food safety standards emphasizing prevention of faults.

McDonald’s India: Channel Network

North and East India (79)

33 in Delhi22 in Uttar Pradesh11 in Haryana7 in Punjab 3 in Rajasthan 1 in Uttaranchal 1 in West Bengal 1 in Himachal Pradesh

West and South India (53) 32 in Maharashtra7 in Gujarat7 in Karnataka4 in Andhra3 in Madhya Pradesh

McDonald’s India: Network & competitors

COMPANIES

McDonald’s

Pizza Hut

Domino’s

Subway

Nirula’s

KFC

OUTLETS (No.)

132

137

220

131

65

34

CITIES COVERED

34

34

42

32

NCR

09

McDonald’s India: Outlets

Standardization is the key!!

McDonald’s India: The Road Ahead…

• Increasing seating capacity.

• Aggressive expansion plans throughout the country.

• More drive thrus.

• Oil alliance with BPCL in 2002, with HPCL in Jan, 2008.

• Independent franchisee model.

• McDelivery on cycles.

• Entry in new cities.

Promotion

•An activity, such as a sale or advertising campaign, designed to increase visibility or sales of a product.

•McDonalds, for years has maintained an extensive promotion strategy with highest spending on marketing amongst all its competitors.

Advertising

• Focus on overall experience.

• “Brand globally and act locally”.

• Overall it is doing what it does the best – marketing.

• Intensive advertising aimed at children.

• Paper mats on trays ensure that no new scheme goes unnoticed.

• 80-20 menu boards marketing tool.

• Sponsors sport events with their logos advertised in these events.

• Significant use of billboards and signage.

• Image of portraying warmth and a real slice of everyday life has become a trademark and has created many memorable commercials.

Advertising

THE mascot…

• The well known mascot Ronald McDonald is the same throughout the world since 1963.

• It is supposed to be the next most well recognized figure second only to Santa Claus.

• The color combination maximizes brand exposure and is supposed to increase hunger

Campaigns…

• “I’m lovin’ it” is an international branding campaign which was launched in 2003 and has proved to be its biggest success.

• “aap ke zamaane mein baap ke zamaane ke daam” is a highly localized campaign which aimed at attracting the masses through its happy price menu.

Process

• Standardization is the key

Ready to cook frozen

food material

Initiator

Assembler

Universal holding Cabinet

Delivery to customer

People

• Each outlet is headed by a Restaurant Manager . He is responsible for the daily operation and customer interaction.

• Delivery Crew Member carries basic operation of a restaurant. Ensures customer satisfaction at the restaurants.

• In order to motivate there employees they give them stars as per their performance.

Organizational Chart

Training

•Has replaced the US army as the Nations largest job training organization

• McDonald’s invests more than $1 billion annually in training

• “Best Place to Work” – Fortune Magazine 2005

• “One out of 5 Best Places to Work in Latin American” – America Economic Magazine 2005

Training At Hamburger

Hamburger University – McDonald’s Center of Training Excellence

• Since its inception, training at Hamburger University has emphasized consistent restaurant operations procedures, service, quality and cleanliness. It has become the company’s global centre of excellence for McDonald’s operations training and leadership development

• February 24, 1961, Hamburger Universities first class of 14 students graduated

• Today, more than 5,000 students attend HAMBURGER UNIVERSITY each year

• Since 1961, more than 80,000 restaurant managers, mid-managers and owner/operators have graduated from this facility

EXPLOITING WORKERS

• Low wages

• No overtimes

• Accidents like Burns due to pressure of quick service

# (The majority of employees are people who have few job options and so are forced to accept this exploitation, and they ’r compelled to ‘smile’ too! Not surprisingly staff turnover at McDonald’s is high, making it virtually impossible to unionise and fight for a better deal, which suits McDonald’s who have always been opposed to Unions.)

Physical evidence..

• Cleanliness, speed, quality and transparency of process is the biggest physical evidence.

• The interiors are attractive and more or less consistent throughout the world.

• A proper decorum and strict standards of cleanliness are maintained at all the joints.

• Extra care is given to make the joints children friendly

• Family environment message throughout the world, just the way of communication is adjusted to different countries.

• Play areas are provided so that kids don’t become panicky.

• Counters are kept low and menus pictorially displayed so that children can order for themselves.

Physical evidence..

Issues with McDonald’s

• Nutritionists argue that the type of high fat, low fibre diet promoted by McDonald's is linked to serious diseases such as cancer, heart disease, obesity and diabetes.

• Many parents object strongly to the influence this has over their own children.

• Complaints from employees range from discrimination and lack of rights, to understaffing, few breaks and illegal hours, to poor safety conditions and kitchens flooded with sewage, and the sale of food that has been dropped on the floor.

•They use their financial clout to influence the media, and legal powers to intimidate people into not speaking out, directly threatening free speech.

•Conservationists have often focussed on McDonald's as an industry leader promoting business practices detrimental to the environment. And yet the company spends a fortune promoting itself as environmentally friendly.

Issues with McDonald’s

We Would like to thank:

Mr. AbhishekJainArea Supervisor

NCR

Mr. Ashish JayalRestaurant Manager

Ansal PlazaGreater Noida.

Thank You