mcdonalds project.docx

8/14/2019 MCDONALDS PROJECT.docx

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VIVEK COLLEGE OF COMMERCE

CASE STUDY ON MCDONALDS PAGE 1

CHAPTER-1

INTRODUCTION

1.1 OVERVIEW OF FAST FOOD INDUSTRIES

The food industry is on a high as Indians continue to have a feast. Fuelled by what can

be termed as a perfect ingredient for any industry - large disposable incomes - the

food sector has been witnessing a marked change in consumption patterns, especially

in terms of food. An increasing number of international fast food chains rushing to

India is because all of them see tremendous potential in for this type of business. The

large upwardly mobile population in the urban areas tend to eat out more often or

business or for leisure.

The various players operating in India are the well established Indian chains like

Nirula's, Haldiram's and multinational companies like McDonalds, Pizza hut,

Domino's pizza, etc.

In addition to these, apparently some of the best known international food chains are

looking at India. Among them are Great American Disaster, The Burger King,

Mexican food chain Tacogrill, Move-n-pick, etc. are some of them to name.

At present all these players are fighting for a small pie, as fast food is really not a big

habit with Indians, but they see a big potential.

The players are fighting on products, pricing, positioning and trying to convert their

first trials into regular purchase by providing delightful service quality. The focus is

on product quality and standardization on taste. Consistency is the key, as its

standardization in fast food as the consumer is short on time and wants to satisfy his

taste buds with a consistent taste experience.Beyond this each player has its own strategy to expand consumer base.

Some feel that pricing is not the deciding factor since fast food is not pricesensitive market because it is not a single diet of Indians.

Some others are competing on positioning which is surprisingly varied, givingthe

small size of the market.

For most, targeting children seems the right strategy. Advertising is popular.


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However, with competition hooting up most chains are increasing reach as well as

working on establishing a national presence.

The wind of change is blowing through the empire of fast food. The vision of endless

growth through new markets across the planet for fast food companies now looks

unsustainable when its time to adapt or die. As the fast food companies have

expanded around the world, they have had to adapt to local sensitivities.

There were disturbances in India when it was learned that McDonalds's were pre-

cooked in beef fat in the USA, because Hindus revere cows and cannot eat beef.

According to a market research company, Euromonitor International, amount of

money Indians spend in eating out has more than doubled in past decade, to about

US$ 5 billion a year and is expected to double again in about half that time.

1.2 TRENDS IN THE FAST FOOD INDUSTRY

The industry is estimated to grow at 9-12 per cent, on the basis of an estimated GDP

growth rate of 6-8 per cent, during the Tenth Five year plan period. Value addition of

food is expected to increase from the current 8 per cent to 35 per cent by the end of

2025. Fruit and vegetable processing, which is currently around 2 per cent of total

production will increase to 10 per cent by 2010 and to 25 per cent by 2025.

The popularity of food and agro products is not surprising when the sector is now

offering a growth of more than 150 per cent in sales. With such promise in the sector,

a number of foreign companies have joined the fray. While US brands such as

McDonald's, Pizza hut and Kentucky Fried Chicken have become household names,

more are on their way.

1.3 THE MARKET SCENARIO

India among top 10 market for weekly fast food consumption, an online survey has

found. Most of the countries are from the Asia-pacific region, with the US being the

exemption.

According to an A C Neilson study of 28 markets across the US, Europe and the Asia-

Pacific, carried out through the internet in interviews with more than 14000

consumers, Asians are the world's greatest fast food fans.


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1.4 MAJOR PLAYERS

In India the major players which constitute the Indian fast food industry includes

Indian as well as Multinational companies.

These are:

Nirula's

Established in 1934, Nirula's today is a diversified group having a chain of elegant

Business hotels, Waiter service restaurants, Family style restaurants, Ice Cream

parlours, pastry shops and food processing plants in India.

The chain with over 60 outlets operating in 5 states successfully caters to the Indianpalate of over 50000 guests every day or over 70 years.

The restaurants serves a wide variety of multi-cuisine foods, both western and Indian

including pizzas, burgers, chana kulcha, saag-roti and much more!

Ice cream parlours offers an extensive range of exciting and innovative ice cream

flavors with one new flavor added every month

Nirula's pastry shops are a one-stop shop for bakery and confectionary items.

Pizza hut

In 1996 Pizza hut came to India with a dine in restaurant in Bangalore that has special

vegetarian pizzas. In addition to traditional Italian topping, it incorporates Indian

favorites such as chicken tikkas, lamb korma, etc. In its list of innovative toppings,

along with pizzas the menu features appetizers like garlic bread and soups, fresh

salads, oven baked pastas and choice f/of ice-cream sundaes.

In 1997 pizza hut opened a restaurant in the capital's building bustling M-Block

market in Greater Kailash-I, unlike the existing pizza hut at shanti niketan which is

delivery counter for just pizzas, this is dine-in whise the entire menu is available.


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Domino's pizza

It was incorporated in 1995 as the master franchise o Domino's pizza international

inc., of USA. the first Domino's pizza store in India opened in January 1996 at new

Delhi. Today it has grown into a countrywide network of over 104 outlets in 30 cities.

Ever since it was established, Domino's Pizza India has maintained its position of

market leadership with its constant product innovation and maintenance of stringent

service standards. It has established a reputation for being a home delivery specialist

capable of delivering pizzas within 30 minutes. It was the first one to start this facility

to customers.

Domino's constantly strives to develop products that suits the tastes of its customers.

Thus time and again Domino's has been innovating toppings suitable to taste buds of

the local populace and these have been very well accepted by the Indian market.

1.5 COMPANY PROFILE

McDonald's Corporation is the world's largest chain of hamburger fast food

restaurants, serving around 68 million customers daily in 119 countries.

Headquartered in the United States, the company began in 1940 as a barbecue

restaurant operated by Richard and Maurice McDonald; in 1948 they reorganized

their business as a hamburger stand using production line principles. Businessman

Ray Kroc joined the company as a franchise agent in 1955. He subsequently

purchased the chain from the McDonald brothers and oversaw its worldwide growth.

A McDonald's restaurant is operated by a franchisee, an affiliate, or the corporation

itself. The corporation's revenues come from the rent, royalties and fees paid by the

franchises, as well as sales in company-operated restaurants. McDonald's revenues

grew 27 percent over the three years ending in 2007 to $22.8 billion, and 9 percent

growth in operating income to $3.9 billion. McDonald's primarily sells hamburgers,

cheeseburgers, chicken, frenchfries, breakfastitems, soft drinks, milkshakes and

desserts. In response to changing consumer tastes, the company has expanded its

menu to include salads, wraps, smoothies and fruit.


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1.6 HISTORY

The business began in 1940, with a restaurant opened by brothers Richard and

Maurice McDonald at 1398 North E Street at West 14th Street in San Bernardino,

California . Their introduction of the "Speedee Service System" in 1948 furthered the

principles of the modern fast-food restaurant that the White hamburger chain had

already put into practice more than two decades earlier. The original mascot of

McDonald's was a man with a chef's hat on top of a hamburger shaped head whose

name was "Speedee". Speedee was eventually replaced with Ronald McDonald by

1967 when the company first filed a U.S. trademark on a clown shaped man having

puffed out costume legs.

McDonald's first filed for a U.S. trademark on the name "McDonald's" on May 4,

1961, with the description "Drive-In Restaurant Services", which continues to be

renewed through the end of December 2009. In the same year, on September 13,

1961, the company filed a logo trademark on an overlapping, double arched "M"

symbol. The overlapping double arched "M" symbol logo was temporarily disfavored

by September 6, 1962, when a trademark was filed for a single arch, shaped over

many of the early McDonald's restaurants in the early years. Although the "Golden

Arches" appeared in various forms, the present form as a letter "M" did not appear

until November 18, 1968, when the company applied for a U.S. trademark. The

present corporation dates its founding to the opening of affranchised restaurant by

Ray Kroc, in Des Plaines, Illinois, on April 15, 1955, the ninth McDonald's restaurant

overall. Kroc later purchased the McDonald brothers' equity in the company and led

its worldwide expansion, and the company became listed on the public stock markets

in 1965. Kroc was also noted for aggressive business practices, compelling the

McDonald brothers to leave the fast food industry. The McDonald brothers and Kroc

feuded over control of the business, as documented in both Kroc's autobiography and

in the McDonald brothers' autobiography. The San Bernardino store was demolished

in 1976 (or 1971, according to Juan Pollo) and the site was sold to the Juan Pollo

restaurant chain. It now serves as headquarters for the Juan Pollo chain, as well as a

McDonald's and Route 66 museum. With the expansion of McDonald's into many

international markets, the company has become a symbol of globalization and the


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spread of the American way of life. Its prominence has also made it a frequent topic

of public debates about obesity, corporate ethics and consumer responsibility.

1.7 KEY DATES

1948: Richard and Maurice McDonald open the first McDonald's restaurant in San

Bernardino, California.

1954: Ray Kroc gains the rights to set up McDonald's restaurants in most of the

country.

1955: Kroc opens his first McDonald's restaurant in Des Plaines, Illinois; he

incorporates his company as McDonald's Corporation.

1960: The slogan, "Look for the Golden Arches," is used in an advertising campaign.

1961: Kroc buys out the McDonald brothers for $2.7 million.

1963: Ronald McDonald makes his debut.

1965: McDonald's goes public.

1967: The company opens its first foreign restaurant in British Columbia, Canada.

1968: The Big Mac is added to the menu.

1973: Breakfast items begin to appear on the menu, with the debut of the Egg Mc

Muffin.

1974: The first Ronald McDonald House opens in Philadelphia.

1975: The first McDonald's drive-thru window appears.

1979: The children's Happy Meal makes its debut.

1983: Chicken Mc Nuggets are introduced.

1985: McDonald's becomes one of the 30 companies that make up the Dow Jones

Industrial Average.

1998: The company takes its first stake in another fast-food chain, buying a minority

interest in Colorado-based Chipotle Mexican Grill.


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1999: Donatos Pizza Inc. is acquired.

2000: McDonald's buys the bankrupt Boston Market chain.

2002: Restructuring charges of $853 million result in the firm's first quarterly loss

since going public.

2003: McDonald's sells Donatos in order to refocus on its core hamburger business.

1.8 GLOBAL OPERATIONS

McDonald's has become emblematic ofglobalization, sometimes referred to as the

"McDonaldization" of society. The newspaper uses the "Big Mac Index": the

comparison of aBig Mac's cost in various worldcurrencies can be used to informally

judge these currencies'purchasing power parity.Norway has the most expensive Big

Mac in the world as of July 2011, while the country with the least expensive Big Mac

isIndia (albeit for aMaharaja Macthe next cheapest Big Mac isHong Kong).

Thomas Friedman once said that no country with a McDonald's had gone to war with

another. However, the "Golden Arches Theory of Conflict Prevention"is not strictly

true. Exceptions are the 1989United States invasion of Panama,NATO's bombing of

Serbia in 1999,the2006 Lebanon War,and the2008 South Ossetia war.

Some observers have suggested that the company should be given credit for

increasing the standard of service in markets that it enters. A group of anthropologists

in a study entitled Golden Arches East looked at the impact McDonald's had on East

Asia, and Hong Kong in particular. When it opened in Hong Kong in 1975,

McDonald's was the first restaurant to consistently offer clean restrooms, driving

customers to demand the same of other restaurants and institutions. McDonald's has

taken to partnering up withSinopec, the second largest oil company in the People'sRepublic of China, as it takes advantage of the country's growing use of personal

vehicles by opening numerous drive-thru restaurants. McDonalds has opened a

McDonald's restaurant and McCaf on the underground premises of the Frenchfine

arts museum, theLouvre.The company stated it will open vegetarian-only restaurants

in India by mid-2013.
http://en.wikipedia.org/wiki/Globalizationhttp://en.wikipedia.org/wiki/McDonaldizationhttp://en.wikipedia.org/wiki/Big_Mac_Indexhttp://en.wikipedia.org/wiki/Big_Machttp://en.wikipedia.org/wiki/Currencyhttp://en.wikipedia.org/wiki/Purchasing_power_parityhttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Maharaja_Machttp://en.wikipedia.org/wiki/Hong_Konghttp://en.wikipedia.org/wiki/Thomas_Friedmanhttp://en.wikipedia.org/wiki/McDonalds_Rulehttp://en.wikipedia.org/wiki/United_States_invasion_of_Panamahttp://en.wikipedia.org/wiki/Kosovo_War#The_NATO_bombing_campaignhttp://en.wikipedia.org/wiki/Kosovo_War#The_NATO_bombing_campaignhttp://en.wikipedia.org/wiki/2006_Lebanon_Warhttp://en.wikipedia.org/wiki/2008_South_Ossetia_warhttp://en.wikipedia.org/wiki/East_Asiahttp://en.wikipedia.org/wiki/East_Asiahttp://en.wikipedia.org/wiki/Sinopechttp://en.wikipedia.org/wiki/Fine_artshttp://en.wikipedia.org/wiki/Fine_artshttp://en.wikipedia.org/wiki/Louvrehttp://en.wikipedia.org/wiki/Louvrehttp://en.wikipedia.org/wiki/Fine_artshttp://en.wikipedia.org/wiki/Fine_artshttp://en.wikipedia.org/wiki/Sinopechttp://en.wikipedia.org/wiki/East_Asiahttp://en.wikipedia.org/wiki/East_Asiahttp://en.wikipedia.org/wiki/2008_South_Ossetia_warhttp://en.wikipedia.org/wiki/2006_Lebanon_Warhttp://en.wikipedia.org/wiki/Kosovo_War#The_NATO_bombing_campaignhttp://en.wikipedia.org/wiki/Kosovo_War#The_NATO_bombing_campaignhttp://en.wikipedia.org/wiki/United_States_invasion_of_Panamahttp://en.wikipedia.org/wiki/McDonalds_Rulehttp://en.wikipedia.org/wiki/Thomas_Friedmanhttp://en.wikipedia.org/wiki/Hong_Konghttp://en.wikipedia.org/wiki/Maharaja_Machttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Purchasing_power_parityhttp://en.wikipedia.org/wiki/Currencyhttp://en.wikipedia.org/wiki/Big_Machttp://en.wikipedia.org/wiki/Big_Mac_Indexhttp://en.wikipedia.org/wiki/McDonaldizationhttp://en.wikipedia.org/wiki/Globalization


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The vegetarian customer India has a huge population of vegetarians. To caterto this customer segment, the company came up with a completely new line of

vegetarian items like McVeggie burger and McAlooTikki. The separation of

vegetarian and non-vegetarian sections is maintained throughout the various

stages.

1.11 SEGMENTATION, TARGETING AND POSITIONING

McDonalds uses demographic segmentation strategy with age as the parameter. The

main target segments are children, youth and the young urban family.

As shown above, kids reign supreme in FMCG purchase related to food products. So

to attract children McDonalds has Happy Meal with which toys ranging from hot

wheels to various Walt Disney characters are given (the latest in this range is the toys

of the movie Madagascar). For this, they have a tie-up with Walt Disney. At several

outlets, it also provides special facilities like Play Place where children can play

arcade games, air hockey, etc. This strategy is aimed at making McDonalds a fun

place to eat. This also helps McDonalds to attract the young urban families wanting

to spend some quality time while their children have fun at the outlet. To target the

teenagers, McDonalds has priced several products aggressively, keeping in mind the

price sensitivity of this target customer. In addition, facilities like Wi-Fi are also

provided to attract students to the outlets like the one at Vile Parle in Mumbai.

71%

59%52%

0%

10%

20%

30%

40%

50%

60%

70%

80%

Biscuits Burgers & Pizzas Fruit Juices

% of kids who influence what FMCG brand their

family buys


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Mc Donalds mein hai kuch baatprojects McDonalds as a place for the whole

family to enjoy. When McDonalds entered in India it was mainly perceived as

targeting the urban upper class people. Today it positions itself as an affordable place

to eat without compromising on the quality of food, service and hygiene. The outlet

ambience and mild background music highlight the comfort that McDonalds

promises in slogans like You deserve a Break Today & Feed your inner child.

This commitment of quality of food and service in a clean, hygienic and relaxing

atmosphere has ensured that McDonalds maintains a positive relationship with the

customers.

1.12 CUSTOMER PERCEPTION AND CUSTOMER EXPECTATION

Customer perception is a key factor affecting a products success. Many potentially

revolutionary products have failed simply because of their inability to build a healthy

perception about themselves in the customers minds. McDonalds being an

internationally renowned brand brings with it certain expectations for the customers.

Customers expect it to be an ambient, hygienic and a little sophisticated brand that

respects their values. The customers expect the brand to enhance their self-image.

Customer responses obtained at the Vile Parle, Mumbai outlet confirmed the fact that

they connect strongly with the brand. However, fulfilling some of the customer

expectations like a broader product variety provide McDonalds a great scope for

improvement.

Target Segment What is McDonalds for me?

A Family with children A treat to children, a fun place to be for the children.

Urban customer on the

move

Great taste, quick service without affecting the work

schedule

Teenager Hangout with friends, but keep it affordable.


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REVIEW OF LITERATURE

McDonalds, the long-time leader in the fast-food wars, faced a crossroads in the

early 1990s. Domestically, sales and revenues were flattening as competitors

encroached on its domain. In addition to its traditional rivalsBurger King, Wendys,

and Taco Bellthe firm encountered new challenges. Sonic and Rallys competed

using a back-to basics approach of quickly serving up burgers, just burgers, for time-

pressed consumers. On the higher end, Olive Garden and Chilis had become potent

competitors in the quick service field, taking dollars away from McDonalds, which

was firmly entrenched in the fast-food arena and hadnt done anything with its dinner

menus to accommodate families looking for a more upscale dining experience. While

these competitive wars were being fought, McDonalds was gathering flak from

environmentalists who decried all the litter and solid waste its restaurants generated

each day. To counter some of the criticism, McDonalds partnered with the

Environmental DefenseFund (EDF) to explore new ways to make its operations more

friendly to the environment.

Facts

McDonalds roots go back to the early 1940s when two brothers opened a burger

restaurant that relied on standardized preparation to maintain qualitythe Speedee

Service System. So impressed was Ray Kroc with the brothers approach that he

became their national franchise agent, relying on the companys proven operating

system to maintain quality and consistency.

Over the next few decades, McDonalds used controlled experimentation to maintain

the McDonalds experience, all the while expanding the menu to appeal to a broader

range of consumers. For example, in June 1976, McDonalds introduced a breakfast

menu as a way to

more fully utilize the physical plant. In 1980, the company rolled out Chicken

McNuggets. Despite these innovations, McDonalds tremendous growth could only

continue for so long. Its average annual return on equity was 25.2% between 1965 and

1991. But the company found its sales per unit slowing between 1990 and 1991. Inaddition, McDonalds share of the quick service market fell from 18.7% in 1985 to


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16.6% in 1991. Plus growth in the quick service market was projected to only keep

pace with inflation in the 1990s. McDonalds faced heightening competition on

several fronts. First, its traditional rivalsBurger King, Wendys,

and Taco Bellwere eating into its margins through promotions and value pricing

strategies. Taking a leaf from McDonalds own playbook, Sonic and Rallys were

using a very limited menu approach to attract time strapped consumers. Finally,

Chilis and Olive Garden were appealing to diners looking for something a little more

enticing that the familiar Golden Arches for their families.

In the late 1980s, McDonalds began recognizing the importance of maintaining an

ecologically correct posture with the public, which was becoming more concerned

about the environment. For example, in 1989, 53% of respondents in one survey

revealed that they had not bought a product because they didnt know what effect the

packaging would have on the environment. Closer to

home, a 1990 study showed that each McDonalds generated 238 pounds of on-

premise solid waste per day. Its no surprise, then, that McDonalds sought a way to

reduce its solid waste while providing a more environmentally acceptable face to the

public. Beginning in 1989, it partnered with the Environmental Defense Fund, aleading organization devoted to protecting the

environment, to seek ways to ease the companys environmental burden on the

landscape. Together, EDF and McDonalds considered its impact on a wide range of

stakeholderscustomers, suppliers, franchisees, and the environment. The company

gave its franchisees much autonomy in finding ways to eliminate environmental

blight. The companys hope was that from these divergent approaches, it stood a

greater chance of finding solutions with broad applicability than if it had tried to

pursue a one-size-fits-all approach from the outset. Some of the environmentally

inspired solutions that came out of the collaboration with EDF were the: Introduction

of brown paper bags with a considerable percentage of recycled content. Solicitation

of suppliers to produce corrugated boxes with more recycled content, which had the

twin effect of reducing solid waste and building a market for recycled products.

Abandonment of polystyrene clamshell containers to hold sandwiches in favor of new

paper-based wraps that combined tissue, polyethylene, and paper to keep food warmand prevent leakage.


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RESEARCH METHODOLOGY

INTRODUCTION TO RESEARCH PROBLEM

MOTIVE: - The basic motive of preparing this report is to study the consumer

preference towards McDonalds in Mumbai and to know about the Buying Behavior

of consumers for McDonalds.

OBJECTIVES: - The objective of the report is to study the consumer preference

towards McDonalds in Mumbai and also to analyze the buying behavior of Burgers

by the people living in Mumbai

SCOPE: - This report to some extend will tell us about the success of the

McDonalds in Mumbai and also about the various other fast food outlets like KFC,

Dominos, Pizza Hut, etc in Mumbai. This report will also help me to know more

about the market strategies and selling modes followed by McDonalds in Mumbai

and various kinds of recommendations and suggestions.

METHODOLOGY: - I have got 50 questionnaire filled in by the localities and

customer outside the McDonalds regardless of caste, creed, nationality in Mumbai.

These questionnaires will account for my primary data where as the secondary data

has been picked up from the internet, books, articles and journals.

OBJECTIVES

Study and analyze marketing strategies of McDonalds in Mumbai. Studying the Marketing Mix of the company.

Performing the SWOT analysis of the company.DATA COLLECTION

Secondary data: -

Already existing data is called secondary data. I collected them by following method

Internet. Books Articles


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CHAPTER-2

ANALYSIS - I

McDonalds Marketing Mix (7 Ps)

After segmenting the market, finding the target segment and positioning itself, each

companyneeds to come up with an offer. The 5 Ps used by McDonalds are:

1. Product

2. Place

3. Price

4. Promotion

5. People

6. Physical Evidence

7. Process


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2.1PRODUCT:

How should the company design, manufacture the product so that it enhances

the customer experience?

Product is the physical product or service offered to the consumer. Product includes

certain aspects such as packaging, guarantee, looks etc. This includes both the

tangible and the non-tangible aspects of the product and service. McDonalds has

intentionally kept its product depth and product width limited. McDonalds studied

the behaviour of the Indian customer and provided a totally different menu as

compared to its International offering. It dropped ham, beef and mutton burgers from

the menu. India is the only country where McDonalds serve vegetarian menu. Even

the sauces and cheese used in India are 100% vegetarian. McDonalds

continuously innovates its products according to the changing preferences and

tastes of its customers. The recent example is the introduction of the Chicken

Maharaja Mac. McDonalds bring with it a globally reputed brand, world class

food quality and excellent customer specific product features.


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2.2PLACE:

Where should be the product be available and the role of distributionchannels?

The place mainly consists of the distribution channels. It is important so that the

product isavailable to the customer at theright place, at theright timeand in theright

quantity.

Nearly 50% of U.S.A is within a 3 minute drive from a McDonalds outlet.

There is a certain degree of fun and happiness that a customer feels each time he dines

at McDonalds. There are certain value propositions that McDonalds offer to its

customers based on their needs. McDonalds offers hygienic environment, good

ambience and great service. Now McDonalds have also started giving internet

facility at their centres and they have been playing music through radio instead of

the normal music. There are certain dedicated areas for children where they can

play while their parents can have some quality time together.

2.3PRICE:

What should be the pricing strategy?

Pricing includes the list price, the discount functions available, the financing optionsa

vailable etc. It should also take into the consideration the probable reaction from the

competitor to the pricing strategy. This is the most important part of the marketing

mix as this is the only part which generates revenue. All the other three are expenses

incurred. The price must take into consideration the appropriate demand-supply

equation. McDonalds came up with a very catchy punch line

Aap ke zamane mein ,baap ke zamaneke daam. This was to attract the middle

and lower class consumers and the effect can clearly be seen in the consumer base

McDonalds has now. McDonalds has certain value pricing and bundling strategies

such as happy meal , combomeal , family meal etc to increase overall sales

volumes.


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2.4PROMOTION:

What is the suitable strategy and channels for promotion of the product?

The various promotion channels being used by McDonalds to effectively

communicate the product information are given above. A clear understanding of the

customer value helps decide whether the cost of promotion is worth spending. There

are three main objectives of advertising for McDonalds areto make people aware

of an item, feel positive about it and remember it.The right message has to be

communicated to the right audience through the right media. McDonalds does its

promotion through television, hoardings and bus shelters. They use print ads and the

television programmes are also an important marketing medium for promotion. Some

of the most famous marketing campaigns of McDonalds are:

You Deservea break today, so get up and get away- To McDonalds

Aap ke zamane mein ,baap ke zamane ke daam.

Food, Folks, and Fun

Im loving it.


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2.5PEOPLE:

How to converge the benefits of internal and external marketing?

McDonalds understands the value of both its employees and its customers. It

understands the fact that a happy employee can serve ell and result in a happy

customer. McDonald continuously does Internal Marketing.

This is important as it must precede external marketing. This includes hiring, training

and motivating able employees. This way they serve customers well and the final

result is a happy customer.

2.6PHYSICAL EVIDENCE:

The physical evidence appearance affects not onlythe impression outsiders have of a

business but allthe way that business functions.

McDonalds focuses on clean and hygienic interiors of is outlets and at the same time

the interiors are attractive and the fast food joint maintains a proper decorum at its

joints.

Hence due importance is to be given to :

Staff members.

Location & appearance.

Buildings Maintence.


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2.7PROCESS

The food manufacturing process at Mc Donalds is completely transparent i.e. the

whole process is visible to the customers. In fact, the fast food joint allows its

customers to view and judge the hygienic standards at Mc Donalds by allowing them

to enter the area where the process takes place. The customers are invited to check the

ingredients used in food.

Hence, McDonalds follows :

Food manufacturing transparent to customers.

Training to the licensees.

Invented the most efficient cooking equipment.

New methods of food packaging anddistribution.

McDonalds in India followed the same tradition.


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2.8SWOTANALYSIS

SWOT analysis is a simple framework for generating strategic alternatives from a

situation analysis. It is applicable to either the corporate level or the business unit

level and frequently appears in marketing plans. Such an analysis of the strategic

environment is referred to as a SWOT analysis. A scan of the internal and external

environment is an important part of the strategic planning process. Environmental

factors internal to the firm usually can be classified as strengths or weaknesses, and

those external to the firm can be classified as opportunities or threats. The SWOT

analysis provides information that is helpful in matching the firm's resources and

capabilities to the competitive environment in which it operates.

STRENGTH

Strong brand name, image and reputation. Large market share. Strong global presence. Specialized training for managers known as the Hamburger University. McDonalds Plan to win focuses on people, products, place, price and

promotion.

Strong financial performance and position. Introduction of new products. Customer focus (centric). Strong performance in the global market place

WEAKNESS

Large market share. Strong supply chain. Rigorous food safety standards. Decentralized yet connected system Ignoring breakfast from the menu


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OPPORTUNITY

Expansion of other cashless payment systems. Well being and ethical image improvement. Expansion of the children market (other businessmarket penetration) Setting up vegetarian menus or outlets to expand the market Growing health trends among consumers Joint ventures with retailers (e.g. supermarkets). Consolidation of retailers likely, so better locations for franchisees. International expansion into emerging markets of China and India. Diversification and acquisition of other quick-service restaurants. Growth of the fast-food industry. Worldwide deregulation. Low cost menu that will attract the customers.

THREATS

The relationship between corporate level McDonald's and its franchise dealers. Anti-American sentiments. Global recession and fluctuating foreign currencies. Intense Competitions Growth of health conscious eaters Outbreak of diseases (mad cow, H5N1, bird flu, SARS) Recent hygiene complaints affect sales


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CHAPTER - 3

ANALYSIS - II

Survey Questionnaire

Q1) Gender

Q2) Age

60%

40%

GENDER

Male

Female

20%

36%

34%

10%

AGE

Below 18

18 to 22

23 to 27

28 and above


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Q3) Occupation

Q4) Do you prefer to have meal form Fast Food restaurant?

24%

6%

8%

10%10%

14%

14%

6%

8%

OCCUPATION

Student

Executive

Public sector worke

Clerical

Secretarial

Manager

Self-employed

Housewife

Others

68%

32%

Prefer to have meal from Fast Food

restaurant

YES

NO


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Q5) Which fast food restaurant(s) do you visit most frequently?

Q6) What is the first thing that strikes your mind about McDonalds?

36%

20%

22%

22%

Prefered Fast Food Restaurant

MCDONALDS

PIZZA HUT

KFC

DOMINOS

26%

16%

22%

18%

18%

First thing that strikes your mind about

McDonalds

BURGER

ADVERTISING

SERVICES

VALUE OF

MONEY

FUN


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Q7) Is the product line in McDonalds adequate?

Q8) Which is your favorite product at McDonalds?

30%

34%

36%

Is the product line adequate

YES

NO

AVERAGE

18%

14%

12%

26%

12%

8%

10%

Favorite product at McDonalds

MAHARAJ MAC

MC CHICKEN BURGER

MC VEGGIE BURGER

FRENCH FRIES

MC CURRY PAN

FILET-O-FISH

OTHERS


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Q9) Which type of McDonalds promotional advertising catch your eye?

Q10) What is the main problem you faced at McDonalds?

14%

16%

18%26%

12%

14%

Promotional advertising catch your eye

INTERNET

NEWSPAPERS

BILLBOARDS

POSTERS

MAGAZINES

TV

20%

16%

18%

14%

32%

Problem faced at McDonalds

LONG QUEUES

RUDE BEHAVIOUR OFEMPLOYEES

CONGESTION

OTHER

NO PROBLEM


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Q11 ) ForMcDonalds products price, is it reasonable? If 10 is perfect, your

score is

Q12) How often do you visit McDonalds outlet?

2%

4%

5%

7%

9%

11%

13%15%

16%

18%

Products price is it reasonable

1 2

3 4

5 6

7 8

9 10

24%

24%

52%

Visit to McDonalds outlet

WEEKLY

MONTHLY

OCCASIONALLY


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Q13) Which area do you think needs the most improvement?

Q14) What factors do you consider important when visiting McDonald's?

10%

8%

30%

22%

20%

10%

Area needs most improvement

DELIVERY TIME

ENVIRONMENT

PRODUCT VARIETY

PRICES

OFFERS AND

DISCOUNTS

OTHERS

18%

12%

20%16%

16%

8%

10%

Factors important when visiting McDonald's

Product assortment

Price

Food quality

Discounts / coupons

Nutrition

Waiting time

Distance to

McDonald's


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Q15) Thinking about your most recent visit to McDonald's, to what level of

satisfaction do you rank that visit?

4%

6%

22%

28%

40%

Level of satisfaction on recent visit to

McDonald's

Very poor

Poor

Good

Very good

Excellent


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CHAPTER-4

SUMMARY, RECOMMENDATIONS & CONCLUSION

SUMMARY

On the basis of gender male (60%) prefer fast food than female (40%). In basis of age majority is at the age of 18-22 (36%) while others are as Below 18

(20%), 23-27 (34%), 28 and above (10%).

Based on occupation here the majority is students (24%) then Manager (14%),Self-employed (14%), Secretarial and Clerical (10%), Public Sector workers and

others (8%) rest Housewife and Executive (6%).

Almost 68% of people prefer to have food form fast food restaurants. MC Donalds is preferred by 36 % of people while pizza hut (20%), kfc (22%)

and dominos (22%).

First thing that strikes mind about MC Donalds is burger (26%) advertising(16%) services (22%) value of money (18%) and fun (18%).

The product line of MC Donalds should be improved since most of themcommented as average (36%), no (34%) and yes (30%).

Majority of people's favourite product is French Fries (26%), Maharaj Mac (18%),mc chicken Burger(14%), mc curry pan and mc veggie burger (12%) filet-o-fish

(8%) and others (10%).

Posters attract most of customers upto (26%) billboards (18%), TV and internet(14%), news papers (16%) and magazines (12%).

There is no major problem faced by customers upto (32%) some of the problemsare long queues (20%) rude behaviour of employees (16%) congestion (18%) and

other (14%).

Based on pricing strategy of MC Donalds upto (18%) customer gave a score of10, (16%) for 9, (15%) for 8, (13%) for 7, (11%) for 6.

Customer visit occasionally upto (52%), weekly (24%) and monthly (24%). MC Donalds needs to improve the product variety then prices, offers and disc

outs, delivery time and environment.


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While visiting MC Donalds (20%) people consider for food quality, (18%) forproduct assortment, (16%) for discounts and nutrition, (10%) for distance and

(8%) for waiting time.

Ranking as per the last visit to MC Donald's (40%) customer voted for excellent,(28%) for very good, (22%) for good, (6%) for poor and (4%) for very poor.

RECOMMENDATIONS

Maintain consistency in the taste and quality of products

Include more items in its product line. (Variety)

Include more veg. options

More promotional and advertising measures to increase its sales or to increase

its market share.

Recognize the small outlets and give more discounts

Growing health trends among consumers

They should focus more on their promotional strategies like advertising etc.


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CONCLUSION

McDonalds is one of the largest fast food companies in the world. They continue

their path for success by keeping their consumers in mind regarding their product

selection as well as their prices. They encourage their employees to do a good job,

usually promote from within, and offers several scholarships to encourage education.

Though McDonalds is a centralized, wait and see company they find ways to use

technological products that will increase their productivity, service, and sales,

everywhere from using the Nintendo DS to train staff to suing Mew POS touch screen

registers. McDonalds will certainly be around for plenty more yearsto come.

McDonalds has been successful in operating within the food service industry through

efficient strategies and quality standards which enables them to gain competitive

advantage. As evidenced by its international market growth, McDonalds has already

been efficient in gaining entry even in the most challenging markets like Britain.

Through its strong sense of quality service and customer satisfaction, McDonalds

was able to offer its products to the Britain market. Products were modified to suit the

British taste and preferences; affordable prices were implemented; effective

promotions and offers were done.

These are some of the strategies involved in the companys business strategy which

allowed McDonalds to gain the Britain support. Despite these successes, the

company should take into consideration the growing level of competitiveness in the

food service industry.

In India, several foreign fast food chains offering similar products are also being

supported by the India consumers. Constant strategic change is then necessary to

ensure that the company would sustain their competitive advantage.

In conclusion, McDonalds has been successful because of the value the company

gives for its customers. Hence, despite the controversial beginning of McDonald s in

India, the company managed to adapt to its peoples cultural needs. Indeed,

McDonalds is a learning organization, one that is willing to learn and open to change.


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BIBLIOGRAPHY

WEBSITES:

http://books.google.co.in http://en.wikipedia.org http://www.mcdonalds.ca http://ezinearticles.com

BOOKS:

Kotler, Phillip and Keller, lane Kevin (2008) Marketing Management, 12thEdition. Prentice hall.
http://books.google.co.in/http://books.google.co.in/http://en.wikipedia.org/http://en.wikipedia.org/http://www.mcdonalds.ca/http://www.mcdonalds.ca/http://ezinearticles.com/http://ezinearticles.com/http://ezinearticles.com/http://www.mcdonalds.ca/http://en.wikipedia.org/http://books.google.co.in/

mcdonalds project.docx

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