PROJECT REPORT ON

STRATEGIC ANALYSIS OF 7P’S OF

MC DONALD’S

SUBMITTED IN THE PARTIAL FULFILMENT FOR THE

AWARD OF THE
DEGREE OF BACHELORS IN BUSINESS
ADMINISTRATION
2021-2024
UNDER THE GUIDENCE OF
MS. PRIYANKA GUPTA
ASSISTANT PROFESSOR, VIPS
SUMMITED BY:
ANANYA GUPTA
ENROLLMENT NO. 00629801721
BATCH NO. BBA, 4TH SEM, SECTION D

Vivekananda School of Business Studies

Vivekananda Institute of Professional Studies
AU Block (Outer Ring Road) Pitampura Delhi
– 110034
 STUDENT UNDERTAKING

This is to certify that I have completed the Project titled “Strategic Analysis of
7P’s of MC Donald’s” under the guidance of “MS. PRIYANKA GUPTA” in
partial fulfilment of the requirement for the award of Degree of Bachelors of
Business Administration (BBA) at Vivekananda Institute of Professional
Studies, Vivekananda School of Business Studies, New Delhi. This is an
original piece of work and has not been submitted elsewhere.

Ananya Gupta
(00629801721)
 CERTIFICATE

This is to certify that the Project titled “Strategic Analysis of 7P’s of

MC Donald’s” is an academic work done by “ANANYA GUPTA”
submitted in the partial fulfilment of the requirement for the award of
Degree of Bachelors of Business Administration (BBA) from
Vivekananda Institute of Professional Studies, Vivekananda School
of Business Studies, New Delhi, under my guidance & direction. To
the best of my knowledge and belief the data & information
presented by him/her in the project has not been submitted earlier.

MS. Priyanka Gupta

 ACKNOWLEDGEMENT

I express my sincere gratitude and thanks to Ms.

Priyanka Gupta for giving me an opportunity to enhance
my skill in my project. I am thankful for her guidance,
patience, and consummate support. I extend my heartiest
thanks to her for enlightening my path. Without her
sincere advice, this project has been impossible.
Moreover, I would also like to thank the various people
who were involved with this project and gave me
invaluable guidance in this regard. Without their help,
this project would not have been as comprehensive and
detailed as it is.
I also feel grateful and elated in expressing my
indebtedness to all those who have directly or indirectly
helped me in accomplishing this research.
TABLE OF CONTENT
 STUDENT UNDERTAKING
CERTIFICATE
ACKNOWLEDGEMENT
CHAPTER 1 INTRODUCTION
1.1 OVERVIEW OF FAST FOOD INDUSTRIES
1.2 TRENDS IN THE FAST FOOD INDUSTRY
1.3 THE MARKET SCENARIO
1.4 MAJOR PLAYERS
1.5 COMPANY PROFILE
1.6 HISTORY
1.7 KEY DATES
1.8 GLOBAL OPERATIONS

1.9 BUSINESS MODEL

1.10 MC DONALD’S IN INDIA
1.11 TARGETING, SEGMENTATION AND
POSITIONING
1.12 CUSTOMER PERCEPTION AND CUSTOMER
EXPECTATION
REVIEW OF LITERATURE
RESEARCH METHODOLOGY
CHAPTER 2 ANALYSIS – I
2.1 PRODUCT
2.2 PLACE
2.3 PRICE
2.4 PROMOTION
2.5 PEOPLE
2.6 PHYSICAL EVIDENCE
2.7 PROCESS
SWOT ANALYSIS
CHAPTER 3 ANALYSIS – II
CHAPTER 4 SUMMARY, RECOMMENDATION
AND CONCLUSION
BIBLIOGRAPHY

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 price
sensitive market because it is not a single diet of Indians.
 Some others are competing on positioning which is surprisingly varied, giving the
small size of the market.
 For most, targeting children seems the right strategy.
 Advertising is popular.
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.
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 Indian palate 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.
 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.

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 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.

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 of globalization, sometimes referred to as the

"McDonaldization" of society. The newspaper uses the "Big Mac Index": the comparison of
a Big Mac's cost in various world currencies 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 is India (albeit for
a Maharaja Mac—the next cheapest Big Mac is Hong 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 1989 United States invasion of Panama, NATO's bombing of Serbia in 1999, the 2006
Lebanon War, and the 2008 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 with Sinopec, the second largest oil
company in the People's Republic of China, as it takes advantage of the country's growing
use of personal vehicles by opening numerous drive-thru restaurants. McDonald’s has opened
a McDonald's restaurant and McCafé on the underground premises of the French fine
arts museum, the Louvre. The company stated it will open vegetarian-only restaurants in
India by mid-2013.

1.9 BUSINESS MODEL

 Franchise Model – Only 15% of the total number of restaurants are owned by the
Company. The remaining 85% is operated by franchises. The company follows a
comprehensive framework of training and monitoring of its franchises to ensure that they
 adhere to the Quality, Service, Cleanliness and Value propositions offered by the
company to its customers.
 Product Consistency – By developing a sophisticated supplier networked operation and
distribution system, the company has been able to achieve consistent product taste and
quality across geographies.

 Act like a retailer and think like a brand – McDonald’s focuses not only on delivering
sales for the immediate present, but also protecting its long-term brand reputation.

1.10 MCDONALD’S IN INDIA

McDonald’s entered India in 1996. McDonald’s India has a joint venture with Connaught
Plaza Restaurants and Hard Castle Restaurants. Connaught Plaza Restaurants manages
operations in North India whereas Hard Castle Restaurants operates restaurants in Western
India. Apart from opening outlets in the major metros, the company is now expanding to Tier
2 cities like Pune and Jaipur.

Challenges in Entering Indian Markets

 Regiocentricism: Re-engineering the menu - McDonald’s has continually adapted to

the customer’s tastes, value systems, lifestyle, language and perception. Globally
McDonald’s was known for its hamburgers, beef and pork burgers. Most Indians are
barred by religion not to consume beef or pork. To survive, the company had to be
responsive to the Indian sensitivities. So McDonald’s came up with chicken, lamb and
fish burgers to suite the Indian palate.

 The vegetarian customer – India has a huge population of vegetarians. To cater to 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

McDonald’s uses demographic segmentation strategy with age as the parameter. The main
target segments are children, youth and the young urban family.

% of kids who influence what FMCG brand their

family buys

80% 71%
70% 59%
60% 52%
50%
40%
30%
20%
10%
0%
Biscuits Burgers & Pizzas Fruit Juices

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 McDonald’s a fun place to eat. This also helps McDonald’s to
attract the young urban families wanting to spend some quality time while their children have
fun at the outlet. To target the teenagers, McDonald’s 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.

“Mc Donald’s mein hai kuch baat” projects McDonald’s as a place for the whole family to
enjoy. When McDonald’s 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 McDonald’s 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 McDonald’s
maintains a positive relationship with the customers.

1.12 CUSTOMER PERCEPTION AND CUSTOMER EXPECTATION

Customer perception is a key factor affecting a product’s 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.

Target Segment What is McDonald’s for me?

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

Urban customer on the Great taste, quick service without affecting the work
move schedule

Teenager Hangout with friends, but keep it affordable.

Customers expect it to be an ambient, hygienic and a little sophisticated brand that respects
their values. The customer’s 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 McDonald’s a great scope for improvement.
 REVIEW OF LITERATURE

McDonald’s, 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 rivals—Burger King, Wendy’s, and Taco Bell—the firm
encountered new challenges. Sonic and Rally’s 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 Chili’s had become potent competitors in the quick service field, taking
dollars away from McDonald’s, which was firmly entrenched in the fast-food arena and
hadn’t done anything with its dinner menus to accommodate families looking for a more
upscale dining experience. While these competitive wars were being fought, McDonald’s was
gathering flak from environmentalists who decried all the litter and solid waste its restaurants
generated each day. To counter some of the criticism, McDonald’s partnered with the
Environmental Defense Fund (EDF) to explore new ways to make its operations more
friendly to the environment.

Facts

McDonald’s roots go back to the early 1940s when two brothers opened a burger restaurant
that relied on standardized preparation to maintain quality—the Speedee Service System. So
impressed was Ray Kroc with the brothers’ approach that he became their national franchise
agent, relying on the company’s proven operating system to maintain quality and consistency.

Over the next few decades, McDonald’s used controlled experimentation to maintain the
McDonald’s experience, all the while expanding the menu to appeal to a broader range of
consumers. For example, in June 1976, McDonald’s 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, McDonald’s 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. In addition, McDonald’s share of the
quick service market fell from 18.7% in 1985 to 16.6% in 1991. Plus growth in the quick
service market was projected to only keep pace with inflation in the 1990s. McDonald’s faced
heightening competition on several fronts. First, its traditional rivals—Burger King, Wendy’s,

and Taco Bell—were eating into its margins through promotions and value pricing strategies.
Taking a leaf from McDonald’s own playbook, Sonic and Rally’s were using a very limited
menu approach to attract time strapped consumers. Finally, Chili’s 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, McDonald’s 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 didn’t know what effect the packaging would have on the
environment. Closer to home, a 1990 study showed that each McDonald’s generated 238
pounds of on-premise solid waste per day. It’s no surprise, then, that McDonald’s 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, a leading
organization devoted to protecting the environment, to seek ways to ease the company’s
environmental burden on the landscape. Together, EDF and McDonald’s considered its
impact on a wide range of stakeholders—customers, suppliers, franchisees, and the
environment. The company gave its franchisees much autonomy in finding ways to eliminate
environmental blight. The company’s 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 warm and prevent leakage.
 RESEARCH METHODOLOGY

INTRODUCTION TO RESEARCH PROBLEM

MOTIVE: - The basic motive of preparing this report is to study the consumer preference
towards McDonald’s and to know about the Buying Behavior of consumers for McDonald’s.

OBJECTIVES: - The objective of the report is to study the consumer preference towards
McDonald’s and also to analyze the buying behavior of Burgers.

SCOPE: - This report to some extend will tell us about the success of the McDonald’s in
India and also about the various other fast food outlets like KFC, Dominos, Pizza Hut, etc in
India. This report will also help me to know more about the market strategies and selling
modes followed by McDonald’s in India and various kinds of recommendations and
suggestions.

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

outside the McDonald’s regardless of caste, creed, nationality in India. 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 McDonald’s.

 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
 CHAPTER-2

ANALYSIS - I

McDonalds Marketing Mix (7 P’s)

After segmenting the market, finding the target segment and positioning itself, each company
needs to come up with an offer. The 5 P’s used by McDonalds are:

1. Product

2. Place

3. Price

4. Promotion

5. People

6. Physical Evidence

7. Process
2.1 PRODUCT:

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.
2.2 PLACE:

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 is
available to the customer at the right place, at the right time and in the right quantity.

Nearly 50% of U.S.A is within a 3 minute drive from a McDonald’s 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.

2.3 PRICE:

What should be the pricing strategy?

Pricing includes the list price, the discount functions available, the financing options
available 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. McDonald’s came up
with a very catchy punch line

“Aap ke zamane mein, baap ke zamane ke 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
, combo meal , family meal etc to increase overall sales volumes.
2.4 PROMOTION:

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

The various promotion channels being used by McDonald’s 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 McDonald’s are to 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. McDonald’s 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 McDonald’s are:

•“You Deserve a break today, so get up and get away- To McDonald’s”

•“Aap ke zamane mein ,baap ke zamane ke daam”.

•“Food, Folks, and Fun”

•“I’m loving it”.

2.5 PEOPLE:

How to converge the benefits of internal and external marketing?

McDonald’s 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.

2.6 PHYSICAL EVIDENCE:

The physical evidence appearance affects not only the impression outsiders have of a
business but all the 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 Maintenance.
2.7 PROCESS

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, McDonald’s follows :

 Food manufacturing transparent to customers.

 Training to the licensees.

 Invented the most efficient cooking equipment.

 New methods of food packaging anddistribution.

McDonald’s in India followed the same tradition.

 SWOT ANALYSIS

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

OPPORTUNITY

 Expansion of other cashless payment systems.

 Well-being and ethical image improvement.
 Expansion of the children market (other business –market 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
 CHAPTER - 3

ANALYSIS - II
Survey Questionnaire

Q1) Gender

GENDER

40%
Male Female

60%

Q2) Age
 AGE

10%
20%
Below 18

18 to 22

23 to 27
34%
28 and above

36%

Q3) Occupation

OCCUPATION

8%
6% Student
24%
Executive
Public sector worke
14% Clerical
Secretarial
6% Manager
Self-employed
Housewife
14% 8%
Others
10%
10%

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

 Prefer to have meal from Fast Food restaurant

32%
YES

NO

68%

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

Prefered Fast Food Restaurant

22%
MCDONALD’S
36%
PIZZA HUT

KFC

22% DOMINOS

20%

Q6) What is the first thing that strikes your mind about McDonald’s?
 First thing that strikes your mind about Mc-
Donald’s

18% BURGER
26%
ADVERTISING

SERVICES

18% VALUE OF
MONEY
16%
FUN

22%

Q7) Is the product line in McDonald’s adequate?

Is the product line adequate

30% YES
36%
NO

AVERAGE

34%

Q8) Which is your favorite product at McDonald’s?

 Favorite product at McDonald’s

10% MAHARAJ MAC

18%
8% MC CHICKEN BURGER

MC VEGGIE BURGER
12%
14%
FRENCH FRIES

MC CURRY PAN

12% FILET-O-FISH
26%
OTHERS

Q9) Which type of McDonald’s promotional advertising catch your eye?

Promotional advertising catch your eye

14% 14%
INTERNET

NEWSPAPERS
12%
16% BILLBOARDS

POSTERS

MAGAZINES
26% 18%
TV

Q10) What is the main problem you faced at McDonald’s?

 Problem faced at McDonald’s

20%
LONG QUEUES
32%

RUDE BEHAVIOUR
OF EMPLOYEES

16% CONGESTION

OTHER
14%
18% NO PROBLEM

Q11 ) For McDonald’s product’s price, is it reasonable? If 10 is perfect, your score is

Product’s price is it reasonable

2%
4%
18% 5%
1 2 3
7%

4 5 6
9%
16%
7 8 9
11%

10
15%
13%

Q12) How often do you visit McDonald’s outlet?

 Visit to McDonald’s outlet

24% WEEKLY

MONTHLY
52%
OCCASIONALLY

24%

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

Area needs most improvement

10% 10%
DELIVERY TIME
8%
ENVIRONMENT
20% PRODUCT VA-
RIETY
PRICES
OFFERS AND
30% DISCOUNTS

22% OTHERS

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

 Factors important when visiting McDonald's

10% Product assortment

18%
8% Price

Food quality

12% Discounts / coupons

16%
Nutrition

Waiting time

20%
Distance to Mc-
16% Donald's

Q15) Thinking about your most recent visit to McDonald's, to what level of satisfaction
do you rank that visit?

Level of satisfaction on recent visit to Mc-

Donald's
4%
6%
Very poor
Poor
40%
22% Good
Very good
Excellent

28%
 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 Donald’s is preferred by 36 % of people while pizza hut (20%), kfc (22%) and
dominos (22%).
 First thing that strikes mind about MC Donald’s is burger (26%) advertising (16%)
services (22%) value of money (18%) and fun (18%).
 The product line of MC Donald’s should be improved since most of them commented 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 customer’s 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 problems are long
queues (20%) rude behaviour of employees (16%) congestion (18%) and other (14%).
 Based on pricing strategy of MC Donald’s upto (18%) customer gave a score of 10,
(16%) for 9, (15%) for 8, (13%) for 7, (11%) for 6.
 Customer visit occasionally upto (52%), weekly (24%) and monthly (24%).
 MC Donald’s needs to improve the product variety then prices, offers and disc outs,
delivery time and environment.
 While visiting MC Donald’s (20%) people consider for food quality, (18%) for product
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.

CONCLUSION

McDonald’s 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 McDonald’s 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. McDonald’s will certainly be around for plenty more years
to come.

McDonald’s 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, McDonald’s 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, McDonald’s 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 company’s business strategy which allowed
McDonald’s 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, McDonald’s 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 people’s cultural needs. Indeed, McDonald’s is a learning
organization, one that is willing to learn and open to change.

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, 12th
Edition. Prentice hall.