Slide 1 -5

Marketing is a continually evolving discipline and as such can be one that companies find
themselves left very much behind the competition if they stand still for too long. One example of
this evolution has been the fundamental changes to the basic Marketing mix. Where once there
were 4 Ps to explain the mix, nowadays it is more commonly accepted that a more developed 7
Ps adds a much needed additional layer of depth to the Marketing Mix with some theorists going
even going further.

Before we get carried away though what is the Marketing Mix and what is the original 4 Ps
principle?

Simply put the Marketing Mix is a tool used by businesses and Marketers to help determine a
product or brands offering. The 4 Ps have been associated with the Marketing Mix since their
creation by E. Jerome McCarthy in 1960. They are,

 Product - The Product should fit the task consumers want it for, it should work and it
should be what the consumers are expecting to get.

 Place – The product should be available from where your target consumer finds it easiest
to shop. This may be High Street, Mail Order or the more current option via e-commerce
or an online shop.

 Price – The Product should always be seen as representing good value for money. This
does not necessarily mean it should be the cheapest available; one of the main tenets of
the marketing concept is that customers are usually happy to pay a little more for
something that works really well for them.

 Promotion – Advertising, PR, Sales Promotion, Personal Selling and, in more recent
times, Social Media are all key communication tools for an organisation. These tools
should be used to put across the organisation’s message to the correct audiences in the
manner they would most like to hear, whether it be informative or appealing to their
emotions.
In the late 70’s it was widely acknowledged by Marketers that the Marketing Mix should be
updated. This led to the creation of the Extended Marketing Mix in 1981 by Booms & Bitner
which added 3 new elements to the 4 Ps Principle. This now allowed the extended Marketing
Mix to include products that are services and not just physical things. They are,

 People – Set of personnel who represent the business and ensure the care and concern to
the customer. All companies are reliant on the people who run them from front line Sales
staff to the Managing Director. Having the right people is essential because they are as
much a part of your business offering as the products/services you are offering.

 Processes – The process to go through by the customer to acquire the service by the
business. The delivery of your service is usually done with the customer present so how
the service is delivered is once again part of what the consumer is paying for.

 Physical Evidence – The physical presentation of the environment of the business where
the customer actually experience the product or the service.

Slide 6

Though McDonald’s sells a wide range of fast food products such as hamburgers and
cheeseburgers, Big Mac, Quarter Pounder with Cheese, Filet-O-Fish, several chicken
sandwiches, Chicken McNuggets, wraps and french fries. The company also offers salads,
oatmeal, shakes, McFlurry desserts, sundaes, soft serve cones, pies, soft drinks, coffee, McCafé
beverages and other beverages, their core product is pressure fried chicken.

McCafé is a coffee-house-style food and beverage chain, owned by McDonald's which is

specialized mainly for coffee and beverages.

Mc Donald’s usually customize their product portfolio to match with the cultural backgrounds of
their location. For example, in Israel, after initial protests, Big Macs are served without cheese in
several outlets, thereby permitting the separation of meat and dairy products required of kosher
restaurants. McDonald’s restaurants in India serve Vegetable McNuggets and a mutton‐based
Maharaja Mac (Big Mac). Such innovations are necessary in a country where Hindus do not eat
beef, Muslims do not eat pork, and Jains (among others) do not eat meat of any type. In Malaysia
and Singapore, McDonald’s underwent rigorous inspections by Muslim clerics to ensure ritual
cleanliness; the chain was rewarded with a Halal certificate, indicating the total absence of pork
products.

Mc Donald’s specially concern about the group of customers who are in the kids category with a
customized, less salted and spiced foods with toys and balloons as gifts for kids.

Slide 7

McDonald’s has realised that, despite the cost savings inherent in standardisation, success can
often be attributed to being able to adapt to a specific environment. This is indeed the case with
its implementation of its pricing strategy, which is one of localisation rather than globalisation.

Following illustrates the comparative Big Mac prices (flagship brand of McDonald’s) from
around the world. It succeeds in highlighting the point that McDonald’s has had to come up with
different pricing strategies for different countries. More importantly, rather than just having a
different pricing policy for the Big Mac in these listed countries, McDonald’s has had to select
the right price for the right market.
The Big Mac, milk shakes and Fries are a few of the products that you will see on their menu
while every consumer can see the price of each individual product as they enter McDonald’s, it
is also quick to see that they use the concept of price bundling. Many consumers will simply
order a ‘Big Mac meal’ or a ‘Happy Meal’. The concept of offering more than one product as a
deal and reducing the price, to encourage the consumer to buy more than one item, is known as
price bundling.

In addition to price bundling you often see McDonald’s using psychological pricing, with items
costing 9.99$.

Mc Donald uses the low cost leader strategy where they promote one particular product at a very
low price and attract customers buy to that product. But once the customer comes in they will
buy some other products also. However the attractive item is that low cost product where the low
cost ice cream corn is the low cost leader.

Mc Donald’s the target market is the lower middle class where the prices are set to be affordable
for that target group.

McDonald’s restaurant has specific value pricing as well as bundling strategy like combo meal,
happy meal, family meal and happy price menu in order to improve total sales of the service and
product.

Slide 8

McDonalds restaurants are found in 110+ countries and it operates more than 36,000 restaurants
worldwide. The different types of restaurants formats are Mc Drive, Mc Café, Mc Express,
McDonalds Next and create your own taste restaurant. McDonald’s outlets are very evenly
spread throughout the cities making them very accessible. In United States almost 50% of
McDonald’s outlets are located three minutes away from each other.

Most McDonalds restaurants allow customers to drive through service with facilities such as
indoor and outdoor seating and counter service.
As an open concept design, McDonalds Next used digital ordering and offered free mobile
charging and table service. It also banned smoking in its restaurants. McDonalds maintains high
quality standards and stringent hygiene norms.

McDonalds offers proper hygienic atmosphere, good abidance and better services.

Now McDonalds have also started offering internet facilities at their outlets, along with music
system through radio, not the normal music but the music which is preferred by young
generation in order to attract them.

There are also games for children the one example is air hockey. Children play games till the
time there parents spend quality time in McDonalds.

Mc Donald’s mobile app and the digital ordering facility has made it is convenient to customers
to enjoy its products without visiting the physical location where they have enabled a virtual
location for their customers.

Slide 9

McDonalds has spent huge money on advertising campaign, it makes use of newspaper ads,
billboards, signage sponsors various sporting events like FIFA world cup, Olympic games, Little
league and many more.

McDonalds is uses aggressive promotion when it comes to its marketing mix. The TV
advertising remains the prime form of advertisement. McDonalds’ TV ads show people engaging
in popular activities.

They have hardly used any negative campaign against their competitors. In India its burgers do
not contain beef and they have divided its kitchen into Vegetarian and Non Vegetarian zones.

Currently McDonalds uses “I’m Lovin it” branding campaign that was created by Heye and
Partner.
McDonalds was official sponsor of 1994 FIFA world cup. Food partner of NBA, official fast
food restaurant in Olympics and sponsored other events like IndyCar series, Rolex Sports Car
series and NASCAR.

The famous celebrity spokespeople of McDonalds include Michael Jordan, Kobe Bryant, Venus
Williams, Jamie McMurray, Justin Timberlake and several other prominent personalities.

Slide 10

McDonalds has a unique way of addressing its customers, and also treats its employees very
well. The employees working at McDonalds have a dress code to follow and the company
emphasises on its employees to be customer friendly, cheering and have affection for people.

The service delivery of McDonalds is given priority and customer satisfaction is of utmost
importance. Employees are given ratings based on their performance and they are encouraged to
take a large part in decision-making process.

Hygiene is of utmost importance followed by quality and service. Each McDonalds outlet has a
restaurant manager who has the responsibility to undertake the daily proceedings. Achieving
customer satisfaction is the goal of the company.

Slide 11

McDonalds leaves an everlasting good impression when it comes to physical evidence in its
marketing mix.

The physical evidence creates a great impact in the minds of the consumer. The attributes of
physical evidence displayed are speed of service, quality and hygiene, cleanliness and
transparency of processes.

Most McDonalds stores display brand colours and is a visible cue of the brand they want to
promote the feel that it is a family restaurant. In addition, smoking is banned inside the restaurant
with clear-labelled instructions.
McDonalds restaurants have a young, vibrant and family feel to all its restaurants worldwide, self
service order counters, lively music in the background etc.

McDonalds’ physical presence is also enhanced by its recognizable yellow ‘M’ logo, McDonalds
Happy Meal toys, burger wrappers, ketchup sachets etc.

The website of McDonalds is also very user friendly and has a strong presence.

Slide 12

McDonalds over the years has improved the cooking methods and process used.

It makes use of the sophisticated equipment’s for food processing and new methods for food
packaging and distribution.

McDonalds has invested in research to improve the processes and has automated several
processes.

The entire distribution network is streamlined to suit McDonalds Values and culture.

The food manufacturing process is visible to customers.

Apart from its, McDonalds has excellent processes in quick service in restaurants by having less
turnaround time, and has a fast home delivery service.

Slide 13

The company can to be “glocal”, i.e. combining elements of globalization and

internationalization. McDonalds can achieve this through applying the maxim, “think global, act
local” (Ohmae, 1989), to all the elements of the marketing mix.

They can include either seasonal fruit (such as apple slices or an orange) or a low-fat dairy
option to the menu. Instead of fries, they can opt for fruit or yogurt instead.
As the customers are with different price perceptions, they can offer packages with essential
items for a meal under different price categories. As an example lower price budget pack and
premium price pack based on the price perception of the customer instead having a fixed price
for all customers. It’s called price differentiation

Use multiple methods of promotion such as bill boards, TV advertisements, Sales promotions;
Public relation like sponsoring, direct selling such as corporate sales can be used for promotional
activities. At the same time they can enhance community relations by conducting charity projects
with their funds such as helping for children who doesn’t have parents for education.

They can introduce a new strategy where the customer can see how the burger is prepared at
kitchen after checking what the ingredients are used.