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Marketing Mix

For

Presented By:

• Abhishek Bhartiya
• B. Aditya Mohan
• Geetika Sodhi
• Mahek Nangia
• Mukul Kumar
• Wasim Shaikh
Introduction
• McDonald’s is the Eighth Most Poweful Brand in the
World. ----Source: Millward Brown Optimor (including data
from brandz, Datamonitor, and Bloomberg)

• Total Revenue for 2006-07 was $740.2 million.

• Estimated CAGR of 40 percent.

• Rs 400 crore being put in for expansion plans into


Tier II cities within next three years.

• Doubling of turnover within three years.

• Market share of 18 percent in north India.(includes


restaurants, cafes, fast food joints, local vendors etc.)
Brief History

• McDonald's was started as a drive-in restaurant by two


brothers, Richard and Maurice McDonald in California,
US in the year 1937.
• By mid-1950s, the restaurant's revenues had reached
$350,000.
Kroc, distributor for milkshake machines, expressed
• Ray Kroc
interest in the business, and he finalized a deal for
franchising with the McDonald brothers in 1954.
• He established a franchising company, the McDonald
Inc.. and appointed franchisees.
System Inc
• In 1961, he bought out the McDonald brothers' share for
$2.7 million and changed the name of the company to
Corporation In 1965, McDonald's went
McDonald's Corporation.
public…
McDonald’s In India
• In 1996, first McDonald’s restaurant
opened on Oct. 13, at Basant Lok,
Vasant Vihar, New Delhi.
• McDonald's India is a 50 – 50 JV
partnership between McDonald’s
Corporation (U.S.A) and two Indian
businessman Amit Jatia (Hardcastle
Restaurants Private Limited, Mumbai)
and Vikram Bakshi (Connaught Plaza
Restaurants Private Limited, Delhi).
• Approximately 75% of the menu
available in McDonald’s in India is
Indianized and specifically designed to
woo Indian customers.
• The McDonald's philosophy of QSC&V
is the guiding force behind its service to
the customers.
Product

“Our clear strategy is to bring the


customers in initially and provide a range
of entry-level products so that they can try
new items and graduate to the higher
rungs.” ---
Vikram Bakshi,
Managing Director,
Northern Region, India
Product Mix

Product
Mix

Non-Veg Frozen
Veg Menu Beverages
Menu Deserts

• McVeggie™ • Chicken Maharaja • Cold Coffee • Soft Serve Cone


• McAloo Tikki™ Mac • Ice Tea • Mc Swirl
• Paneer Salsa Wrap • McChicken • Soft Drinks • Soft Serve
• Crispy Chinese • Fiet-O-Fish • Mc Shakes • Flavor Burst
• Veg McCurry Pan™ • Chicken Mexican • Hot Serves • Floats
• Pizza McPuff™ Wrap
• Chicken McGrill
Veg Menu
Non--Veg Menu
Non
Beverages
Frozen Deserts
Co - Branding

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


branding Statergy.

Few of Them are listed Below:

Coca-Cola

Barbie

Cadbury

Hotwheels
Pricing

• Initial focus on metros – Mumbai and Delhi.

• Relatively high income.

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

• Jaipur and Agra – to attract foreign tourists.


Household Expenditures

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


Pricing Strategy

Purchasing power pricing:-

a) In 1997 slashed prices for vegetable nuggets and


soft serve cone.

b) In September 2001, they offered Veg surprise


burgers for Rs 17.

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

zamane ka daam.
Pricing Strategy

Value Ladder strategy :-


a) Started offering value meals in a range of prices.
b) Ensure affordability and attract widest section of
customers.
c) Brought the customer and provided a range of entry-
level products.
d) Try those new items and graduate to higher-rungs.
e) E.g- if a customer starts with McAloo Tikki, he will
finally graduate to McVeggie and so in Non veg.
f) Helped its Volume business.
Aap ke zamane mein,
baap ke zamane ka daam!!!
daam!!!

Value Pricing.
a) Happy price menu – Rs 20.
b) Economeal – Rs 49(save Rs 11).
c) McChicken & McVeggie Meal – Rs 75,Rs 65 (Save Rs 15).
d) Happy Meal for Kids – Rs 69,99,109 (toy free).
e) Big saving Meals – Combos Rs 109 – Rs 119(Save Rs 36).
f) A-la carte menu – Rs 45- Rs 65 (Veg)
Rs 55- Rs 65 (Non Veg)
a) Desserts – Rs 12 – Rs 25.
b) Beverages – Rs 25- 50 ( a little costly)
Product Bundling

Package deal.
• The most common strategy in fast food industry.
• The most preferred style for customers of McD.
• Plays on Psychological factor of the customer.
• Customer acquisition costs are high.
• Consumers appreciate the resulting simplification of
the purchase decision.
• The product mix offers are different in various parts of
India.
80--20 Menu Board
80

• 80% visual.
• 20% descriptive.
• Easier for customers to understand what
29,39,49,59,89,99 rupee options are.
• Pricing range, quick service, no-tips
environment attracted middle class and
students.
Competitive Pricing

Food McD SUBWAY KFC PIZZAHUT DOMINO’


items S
Burgers & Rs 20- Rs Rs 65- Rs Rs 25 – Rs 55- Rs Rs 35- Rs
Pizzas 70 135 Rs175 175 140
(regular) (regular)
Combo Rs 49-Rs Rs 45- Rs Rs 55-Rs Rs 120- Rs Rs 120- Rs
Meals 119 175 150 250 230

Beverages Rs 25- Rs Rs 35- Rs Rs 30-Rs Pet Rs 30


50 45 55 beverage (600 ml)
Small- Small- Small- MRP
300ml 300ml 300ml (600 ml)

Desserts Rs 12-Rs Rs 20-Rs Rs 15-Rs Rs 40- Rs Rs 25


25 50 65 60 (100ml
cup of
Baskin
Robbins)
Sustaining – HOW?

Cost control strategy:-


a) Well established low –cost
supply chain.
b) Ensures efficiency and speed
in distribution.
c) Huge increase in volume
sales.
d) Very good food processing
technology.
McDonald’s : A locally Owned
Company

McDonald’s
Corporation

McDonald’s
India Pvt.
Ltd.

Connaught
Hard Castle
Plaza Rest. Pvt.
Rest. Pvt. Ltd.
Ltd.
(West & South)
(North & East)
McDonald’s : A locally Owned
Company

Geographically Diverse suppliers: Ensuring stringent quality standards


McDonald’s India: Suppliers

• Trikaya Agriculture
Supplier of Iceberg Lettuce

• Vista Processed Foods Pvt. Ltd.


Supplier of Chicken and Vegetable range of
products.

• Dynamix Diary
Supplier of Cheese.

• Amrit Food
Supplier of long life UHT Milk and Milk
Products for Frozen Desserts.
McDonald’s India: Suppliers

SELECTION

MODIFICATION

EVALUATION

MOTIVATION
McDonald’s India: Distribution

Radhakrishna Foodland
Distribution Centres and cold storages.

“With a cold chain in place there is practically no need for a knife in


the restaurant. Chopping and food processing is done in plants.
Restaurants are confined only to actual cooking” – Amit Jatia.

•Completely dedicated distribution and supply chain.

• Matching supplier production with deliveries using ERP.

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


supply chain.

• HACCP(Hazard analysis critical control points) food safety


standards emphasizing prevention of faults.
McDonald’s India: Channel
Network

North and East India (79)

33 in Delhi
22 in Uttar Pradesh
11 in Haryana
7 in Punjab
3 in Rajasthan
1 in Uttaranchal
1 in West Bengal
1 in Himachal Pradesh

West and South India (53)

32 in Maharashtra
7 in Gujarat
7 in Karnataka
4 in Andhra
3 in Madhya Pradesh
McDonald’s India: Network &
competitors

COMPANIES OUTLETS (No.) CITIES COVERED

McDonald’s 132 34

Pizza Hut 137 34

Domino’s 220 42

Subway 131 32

Nirula’s 65 NCR

KFC 34 09
McDonald’s India: Outlets

Standardization is the key!!


McDonald’s India: The Road
Ahead…

• Increasing seating capacity.

• Aggressive expansion plans throughout the country.

• More drive thru’s.

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

• Independent franchisee model.

• McDelivery on cycles.

• Entry in new cities.


Promotion

•An activity, such as a sale or advertising


campaign, designed to increase visibility
or sales of a product.

•McDonalds, for years has maintained an


extensive promotion strategy with
highest spending on marketing amongst
all its competitors.
Advertising

• Focus on overall
experience.
• “Brand globally and act
locally”.
• Overall it is doing what it
does the best – marketing.
• Intensive advertising aimed
at children.
• Paper mats on trays ensure
that no new scheme goes
unnoticed.
Advertising

• 80-20 menu boards marketing


tool.
• Sponsors sport events with
their logos advertised in these
events.
• Significant use of billboards
and signage.
• Image of portraying warmth
and a real slice of everyday
life has become a trademark
and has created many
memorable commercials.
THE mascot…
• The well known mascot
Ronald McDonald is the
same throughout the
world since 1963.
• It is supposed to be the
next most well recognized
figure second only to
Santa Claus.
• The color combination
maximizes brand
exposure and is supposed
to increase hunger
Campaigns…

• “I’m lovin’ it” is an


international branding
campaign which was
launched in 2003 and has
proved to be its biggest
success.
• “aap ke zamaane mein
baap ke zamaane ke daam”
is a highly localized
campaign which aimed at
attracting the masses
through its happy price
menu.
Issues with McDonald’s

• Nutritionists argue that the type of high fat, low fibre


diet promoted by McDonald's is linked to serious
diseases such as cancer, heart disease, obesity and
diabetes.

• Many parents object strongly to the influence this has


over their own children.

• Complaints from employees range from discrimination


and lack of rights, to understaffing, few breaks and
illegal hours, to poor safety conditions and kitchens
flooded with sewage, and the sale of food that has
been dropped on the floor.
Issues with McDonald’s

• They use their financial clout to influence


the media, and legal powers to intimidate
people into not speaking out, directly
threatening free speech.
• Conservationists have often focussed on
McDonald's as an industry leader
promoting business practices detrimental
to the environment. And yet the company
spends a fortune promoting itself as
environmentally friendly.
People

• Each outlet is headed by a


Restaurant Manager . He is
responsible for the daily
operation and customer
interaction.

• Delivery Crew Member


carries basic operation of a
restaurant. Ensures customer
satisfaction at the
restaurants.

• In order to motivate there


employees they give them
stars as per their
performance.
Training At Hamburger

Hamburger University – McDonald’s Centre of Training Excellence

• Since its inception, training at Hamburger University has


emphasized consistent restaurant operations procedures, service,
quality and cleanliness. It has become the company’s global centre
of excellence for McDonald’s operations training and leadership
development
• February 24, 1961, Hamburger Universities first class of 14
students graduated
• Today, more than 5,000 students attend HAMBURGER UNIVERSITY
each year
• Since 1961, more than 80,000 restaurant managers, mid-
managers and owner/operators have graduated from this facility
Organizational Chart
Physical evidence..
• Cleanliness, speed, quality and transparency
of process is the biggest physical evidence.

• The interiors are attractive and more or less


consistent throughout the world.

• A proper decorum and strict standards of


cleanliness are maintained at all the joints.

• Extra care is given to make the joints children


friendly
Physical evidence..

• Family environment message throughout the


world, just the way of communication is
adjusted to different countries.

• Play areas are provided so that kids don’t


become panicky.

• Counters are kept low and menus pictorially


displayed so that children can order for
themselves.
Process

Ready to
cook frozen
food material

Delivery to
customer
Initiator
Universal
holding
Cabinet

Assembler
Thank You