SERVICE MARKETING MIX ON MCDONALDS

Aditya.S.BetalaVarun.A.Betala

Sanket.R.Fulfagar

INTRODUCTION • Started in 1937 as barbeque drive in restaurant by two brothers Dick & Mac McDonald in sanbernardino,

California. • Raymond kroc, founder & builder of McDonald’s Corporation was a milkshake machine salesman prior

to meeting the two brothers in 1954.• By 1958 McDonald had sold its 100millionth hamburger.• McDonalds restaurant is operated by either a franchise, an affiliate, or the Corporation itself.• Revenues comes from the rent royalties & Fees paid by the Franchisees, as well as sales in company

operated restaurants.• Currently McDonalds a chain of family restaurants Operates in 119 countries & having more than

36,525 restaurants & serving 68million customer everyday by 4,20,000 employees• Low price, Speed, Service & cleanliness became the critical success factor of the business.• McDonalds established in India on October 13 1996.• McDonalds India is a 50-50 J.V. Partnership between McDonalds corporation [USA] & 2 Indian

Businessman-Amit Jatia & Vikram Bakshi.

Source-www.mcdonaldsindia.net

Source-www.mcdonalds.com

Industrial Analysis

MCDONALDS VALUE CHAIN ANALYSIS Inbound logistic - Food and materials to restaurants through

approved third party logistics. Operations - Ensures fixed process in food preparation. It operates

in Conventional franchising, Developmental license, Affiliates. Outbound logistic - Macdonald’s restaurants operate in the

following formats: sit-down restaurants, drive-thru, counter-service outlets in food courts.

Marketing & Sales - McDonald’s uses print and media advertising.

Service -High speed services.

Source- http://research-methodology.net/mcdonalds-value-chain-analysis/

Operational Formats of McDonalds

INDUSTRIAL ANALYSIS[CONTINUED]

MCDONALDS 5 FORCES ANALYSIS(MICHAEL FIVE FORCES MODEL)

1-Threat of Competition-HIGH Very similar products in the fast food industry. High competitors advertising capabilities. Location of outlets are closed enough ex KFC, Star Bucks etc.2-Threat of New Entrants-MODERATE. Low switching cost. Moderate capital cost. High cost of Brand Development.3- Bargaining Power of McDonald’s Customers/Buyers (Strong Force) Low switching costs. Large number of providers . High availability of substitutes.

CONTINUED…

4- Bargaining Power of McDonald’s Suppliers (Weak Force)-• Large number of suppliers.• Low forward vertical integration.• High overall supply.5- Threat of Substitutes or Substitution (Strong Force)• High substitute availability.• Low switching costs.• High performance-to-cost ratio.Sources- McDonald’s Corporation Form 10-K 2014.• Roy, D. (2011). Strategic Foresight and Porter’s Five Forces. GRIN Verlag.• United States Department of Agriculture Economic Research Service (2015). 

Food Service Industry Market Segments.

SWOT ANALYSIS OF MC-D

• Strengths- Successful Advertisement & brand name.Collaboration with coke, dannon yogurt, Heinz ketchup.Socially responsible with charities.Safety and quality food.• Weakness –Management failure to see trends that do not fitHigh employed turnoverPrice competition Controlling quality with franchised operationNegativity publicity-unhealthy food menu

• OpportunitiesUpscale restaurantsServing only1% of the world populationOrganic food for health consciousExpanding to new part of globe • ThreatsSued for unhealthy food many timesHealth concernCompetitorsContamination risksGeopolitical issue affect

7PS OF MCDONALDS1P-Product.

Product Profile Vegetarian Menu.Non-Vegetarian Menu.Beverages.Frozen Deserts.Product Attributes.Care for customers sentiments towards religion & Culture.It has separate cooking areas & Equipment's.

2P-PRICE

Quite Affordable Products.o Brand Affordability.[B.A] Ex-McAloo tikki Rs20 to 39etc.o Brand Core Value product[B.C.V]Ex- McVegiee Rs 50 to 60etcPsychological Connotations.Cost Leadership.Heavily Marketed “Happy price Menu”.Many Combos.Low Cost Food FranchiseSource-www.marketing91.com

3P-PLACE

• Located in Prime Locations[Malls, Shoping Complex's].• Almost In all big cities-Easily accesible.• Drive-in & Drive through Options MC-D Future Convenient to consumer.• Covering many residential areas ex-NCR.• Right of the High-ways.

4P-PROMOTION

Advertising through T.V, Radio, Cinema, Online, Postersites & Press like News Paper & magazines

Other Promotional methods include-Point of Sales Display, Merchandising, Direct mail, Loyalty Schemes, Door Drops etc.

McDonalds Prime focus is on targeting children in “Happy Meals” to which are targeted at children-Small toys are given along with meal.

Lucky draws, Scratch Cards.Hoardings at Major Places.

5P-PEOPLE

• Philosophy of quality, services, cleanliness and value is the guiding force behind its service.• Fast friendly service.• McD has standard uniform for employs for equality service treatment• Delivery crew members carries basic operation of a restaurant. Ensure customer satisfaction

at the restaurants.

6P- PHYSICAL EVIDENCE

• The physical evidence appearance affects not only the impression outsiders have of a business but all the way that business functions

• Staff members• Location and appearance• Buildings Maintenance.• Interior.

CLEANNESS SPEED QUALITY TRANPARENCY

PHYSICAL EVIDENCE

7P-PROCESS

• Food Producing Transparent to consumers.• New method of packaging & distribution.• Invented most Efficient cooking equipment.• Customers are invited to check the ingredients used in food.• It allows customer to enter the area where the Process takes place to have a Clearview of what they are consuming.

INNOVATIVE ADDITIONS-

McDonalds should go for healthy products like now its using Maida for producing breads it should use wheat flour to produce it.

It should go for fruit based products like juices, fruit salads etc.It should have tie ups with Indian Railways to serve the tourist/travellers.It should also have tie ups with State bus transport corporation for serving road transport, Flights and

Cruse.Corporate tie-ups for target reach.It should have Table Tab system, the orders will be made directly from the table to the kitchen.It should use tools like Customer relationship Management & Data Base Management.Make to order. Introducing of Jain Food. It should host candle night dinner once in month as pilot project.It should have food carnival relating to innovative fast food and apply in McDonalds.Event Caterings.

Thank You Lets meet

at McDonald

s