Case Study on

2010

Submitted By:
Abhishek Anil Verma Ankita Khurana Anudeep Ashish Dutt Avleen Kaur Chinky Nagpal Manjinder

One world, One Burger- McDonalds

McDonalds History in India

 Entered in India 1996 McDonald's India is a 50 50 JV partnership between MCDONALDS CORPORATION (U.S.A) and two Indian businessman Amit Jatia and Vikram Bakshi Localization: Dont offer any beef or pork item in india In product like McVeggie, pizza McPuff etc. they use spices favored by Indians Soft serves and McShakes are eggless

Actively Involved in many social activities like CHILD

EDUCATION, PULSE POLIO, etc 1996 the first McDonalds restaurant opened on Oct. 13, at Basant Lok, Vasant Vihar, New Delhi. It was also the first restaurant in the world not serving beef on its menu 1997the first Drive Thru restaurant at Noida 1999the first Mall location restaurant at Ansal Plaza New Delhi 2000the first highway restaurant at Mathura 2001the first thematic restaurant at Connaught Place 2002the first restaurant in a food court at 3Cs, Lajpat Nagar and the first restaurant at the Delhi Metro Station at Inter State Bus Terminus

Introduction:McDonald's is one of the best-known brands worldwide. This case study shows how McDonald's repetitively aims to build its brand by listening to its customers. It also identifies the various stages in the marketing process. Branding develops a personality for an organization, product or service. The brand image represents how consumers view the organization. Branding only works when an organization behaves and presents itself in a consistent way. Marketing communication methods, such as advertising and promotion, are used to create the colors, designs and images, which give the brand its recognizable face. At McDonald's this is represented by its familiar logo - the Golden Arches. Marketing involves identifying customer needs and requirements, and meeting these needs in a better way than competitors. In this way a company creates loyal customers. The starting point is to find out who potential customers are - not everyone want that McDonald's has to offer. The people, that McDonald's identifies as likely customers are known as key audiences.

The marketing mix and market research

Having identified its key audiences a company has to ensure a marketing mix is created that appeals specifically to those people. The marketing mix is a term used to describe the four main marketing tools (4Ps):

Product Price Promotion and the Place through which products are sold to customers.

1. Product
The important thing to remember when offering menu items to customers is that they have a choice. They have a huge number of ways of spending their money and places to spend it. Therefore, McDonald's places considerable emphasis on developing a menu which customers want. Market research establishes exactly what this is. However, customers' requirements change over time. What is fashionable and attractive today may be discarded tomorrow. Marketing continuously monitors customers' preferences. In order to meet these changes, McDonald's has introduced new products and phased out old ones, and will continue to do so. Care is taken not to adversely affect the sales of one choice by introducing a new choice, which will cannibalize sales from the existing one (trade off). McDonald's knows that items on its menu will vary in

popularity. Their ability to generate profits will vary at different points in their life cycle. Products go through a life cycle, which is illustrated below:

The type of marketing undertaken and the amount invested will be different, depending on the stage a product has reached. For example, the launch of a new product will typically involve television and other advertising support. At any time a company will have a portfolio of products each in a different stage of its lifecycle. Some of McDonald's options are growing in popularity while arguably the Big Mac is at the 'maturity' stage.

Sample menu of Mc Donalds

2. Price
The customer's perception of value is an important determinant of the price charged. Customers draw their own mental picture of what a product is worth. A product is more than a physical item, it also has psychological connotations for the customer. The danger of using low price as a marketing tool is that the customer may feel that quality is being compromised. It is important when deciding on price to be fully aware of the brand and its integrity. A further consequence of price reduction is that competitors match prices

resulting in no extra demand. This means the profit margin has been reduced without increasing sales.

3. Promotions
The promotions aspect of the marketing mix covers all types of marketing communications. The methods include advertising, sometimes known as 'above the line' activity. Advertising is conducted on TV, radio, cinema, online, poster sites and in the press (newspapers, magazines). What distinguishes advertising from other marketing communications is that media owners are paid before the advertiser can take space in the

medium. Other promotional methods include sales promotions, point of sale display, merchandising, direct mail, telemarketing, exhibitions, seminars, loyalty schemes, door drops, demonstrations, etc. The skill in marketing communications is to develop a campaign which uses several of these methods in a way that provides the most effective results. For example, TV advertising makes people aware of a food item and press advertising provides more detail. This may be supported by in store promotions to get people to try the product and a collectable promotional device to encourage them to keep buying the item. It is imperative that the messages communicated support each other and do not confuse customers. A thorough understanding of what the brand represents is the key to a consistent message. The purpose of most marketing communications is to move the target audience to some type of action. This may be to: buy the product, visit a restaurant, recommend the choice to a friend or increase purchase of the menu item. Key objectives of advertising are to make people aware of an item, feel positive about it and remember it. The more McDonald's knows about the people it is serving the more it is able to communicate messages which appeal to them. Messages should gain customers' attention and keep their interest. The next stage is to get them to want what is offered. Showing the benefits which they will obtain by taking action, is usually sufficient. The right messages must be targeted at the right audience, using the right media.

For example, to reach a single professional woman with income above a certain level, it may be better to take an advertisement in Cosmopolitan than Woman's Own. To advertise to mothers with children, it may be more effective to take advertising space in cinemas during Disney films. The right media depends on who the viewers, readers or listeners are and how closely they resemble the target audience.

4. Place

Place in the marketing mix, is not just about the physical location or distribution points for products. It encompasses the management of a range of processes involved in bringing products to the end consumer.

Marketing Strategy of McDonalds

Using detailed information about its customers, McDonald's marketing department can determine: 1. What products are well received? 2. What prices consumers are willing to pay? 3. What TV programs, newspapers and advertising consumers read or view? 4. What restaurants are visited? Market research is the format which enables McDonald's to identify this key information. Accurate research is essential in creating the right mix to win customer loyalty.

In all its markets McDonald's faces competition from other businesses. Additionally, economic, legal and technological changes, social factors, the retail environment and many other elements affect McDonald's success in the market.

Market research identifies these factors and anticipates how they will affect people's willingness to buy. As the economy and social attitudes change, so do buying patterns. McDonald's needs to identify whether the number of target customers is growing or shrinking and whether their buying habits will change in the future. Market research considers everything that affects buying decisions. These buying decisions can often be affected by wider factors than just

the product itself. Psychological factors are important, e.g. what image does the product give or how the consumer feels when purchasing it. These additional psychological factors are significantly important to the customer. They can be even more important than the products' physical benefits. Through marketing, McDonald's establishes a prominent position in the minds of customers. This is known as branding.

S.W.O.T. Analysis

Main Strengths of Mc Donalds

Brand Equityworld-wide

 42% of US fast-food hamburger business Consistency of food Successful items: Fries, Happy Meal, Aloo tikki, Egg McMuffin, Promotions Overseas market Balance sheet position

Main weakness of Mc Donalds Declining market share

Weak product development

Quality and taste of products Main Opportunities

International expansion Only serving 1% of the worlds population Growing dining-out market

Main Threats

Mature/overstored industry Strength of competition More health-conscious consumers Fluctuation of foreign exchange rates; Economies

Product Development

Successes: Fries, Happy Meal, Big Mac, Egg Mc Muffin,

Promotions.

Failures: Mc Pizza, Fajita, Carrot Sticks, Mc Lean, and the Arch

Deluxe

Social Events sponsored by McDonald's