Study The Service Experience Rendered By McDonald’s To Its Customers
(Term Paper towards the partial fulfillment of the assessment in the subject of Service Marketing)
Submitted by: Anushree Gang Roll No. 144 Vth Semester
Submitted to: Dr (Ms) Archi Mathur Faculty of Management
NATIONAL LAW UNIVERSITY, JODHPUR Winter Session (July- November 2009)
Preparing an academic project at the Post Graduation Level should serve as the very base of further practical projects likely to be taken up by the candidate during his future career. Luc de Clapiers de Vauvenargues, a French Author has very well said that Men despise great projects when they do not feel themselves capable of great successes. But it is normally seen that academic projects are a result of the candidate’s feeling that he is really capable of undertaking the proposed project. With the same conception in my mind and proper navigation of Respected Dr (Ms) Archi Mathur, I have made an honest attempt to study in detail the topic and have conducted sincere research on the topic. This project has the detailed out information regarding service experience of the customers of the Mc Donald’s.
The ensuing pages of work are the cumulative results of extensive guidance, hard-work and unstinting support. Thus it is with depth of gratitude and humility of words that I commence to acknowledge all those people, without whom this study could not have been a reality. It is to my esteemed guide Respected Dr (Ms) Archi Mathur, National Law University, Jodhpur. I owe heartfelt thanks for her, precious and painstaking guidance during the course of my work. Her consistently affectionate behavior has been much beyond his formal department. For all these consideration I beholden to in a special measure and no words can fully convey my feeling of respect and regard to her. This project would have not been able to cover all the prospects of the topic without her guidance and help. Words are a poor substitute to express my feelings of respect and regards to my family member and especially my brother who are a beacon of inspiration, encouragement and applauded and encouraged my efforts constantly.
TABLE OF CONTENTS
Sr. No. Particulars EXECUTIVE SUMMARY OBJECTIVES RESEARCH METHODOLOGY Introduction To Service Marketing FOOD INDUSTRY- An Overview SERVICE EXPEREINCE- The Concept McDONALD’s – The Organization DATA TABULATION DATA ANALYSIS Objective I Objective II 7. Objective III CONCLUSION and RECOMMENDATION Bibliography ANNEXURE Questionnaire for the consumers Page No. 5 6 7 8 13 18 26 35 45 46 48 50 52 55 57
1. 2. 3. 4. 5. 6.
Services are everywhere, whether it be travel to an exotic tourism destination, a visit to the doctor, a church service, a meal at our favorite restaurant, or a day at school. In developed economies, employment is dominated by service jobs and most new job growth comes from services. Jobs range from high-paid professionals and technicians to minimum-wage positions. Service organizations can be any size—from huge global corporations to local small businesses. Most activities by government agencies and nonprofit organizations involve services. Service sector in India accounts to approx 50%1. Service Marketing is a very dynamic discipline. Activities, benefits and satisfactions, which are offered for sale or are provided in connection with the sale of goods”- (AMA). A service can be an act or performance offered by one party to another (performances are intangible, but may involve use of physical products) or an economic activity that does not result in ownership or a process that creates benefits by facilitating a desired change in customers themselves, physical possessions, or intangible assets. Apart from the 4 P’s of marketing mix- Product, Price, Place and Promotion, service marketing involves three more extended P’s i.e. People, Process and Physical evidence. Service Experience is the best way to describe what happens to a consumer. It constitutes sum of all encounters between a customer and service provider while buying/using 2 a service, feelings about such encounters immediately after the events and sometimes the recollections about the event after a period of time. The four components of the servuction model combine to create the experience for the consumer and it is the experience that creates the bundle of benefits for the consumer. McDonald’s entered India in 1996 in the month of October using the franchise route. By franchising to local people, the delivery and interpretation of what might be seen as US brand culture are automatically translated by the local people in terms of both product and service. McDonald's is a leading international fast food restaurant chain with 31,000 restaurants spread across the globe.
http://www.aueb.gr/users/esaopa/courses/part2.pdf s Rajendra Nargundkar, Service Marketing- Text and Cases, 2nd edn, McGraw Hill Companies, New Delhi 2008
a) To identify and analyze the various components of the service experience rendered by McDonald’s to its customer. b) To analyze the impact of service experience on customers at McDonald’s. c) To study the challenges in maintaining and improving the service experience rendered by McDonald’s.
The methodology of the study included selection of sample, study/survey of library references, collation and compilation of the primary and secondary data and information obtained through structured questionnaires, open ended interview. The method of research was deductive as conclusion would be drawn after the analysis and interpretation of data collected.
INTRODUCTION TO SERVICE MARKETING
Services are everywhere, whether it be travel to an exotic tourism destination, a visit to the doctor, a church service, a meal at our favorite restaurant, or a day at school. The industrialized economies are also finding service sector as their major contributor to the national income. In most countries, services add more economic value than agriculture, raw materials and manufacturing combined. In developed economies, employment is dominated by service jobs and most new job growth comes from services. Service organizations can be any size—from huge global corporations to local small businesses. Most activities by government agencies and nonprofit organizations involve services. A service is the action of doing something for someone or something. It is largely intangible (i.e. not material). A product is tangible (i.e. material) since you can touch it and own it. An act or performance offered by one party to another (performances are intangible, but may involve use of physical products) .An economic activity that does not result in ownership. A process that creates benefits by facilitating a desired change in customers themselves, physical possessions, or intangible assets. A service tends to be an experience that is consumed at the point where it is purchased, and cannot be owned since it quickly perishes. For example- a person could go to a café one day and have excellent service, and then return the next day and have a poor experience. DEFINITION “Activities, benefits and satisfactions, which are offered for sale or are provided in connection with the sale of goods”.-American Marketing Association3(1960) “Services include all economic activities whose output is not a physical product or construction, is generally consumed at the time it is produced, and provides added value in forms (such as convenience, amusement, timeliness, comfort or health) that are essentially intangible concerns of its first purchaser”.- Quinn, Baruch and Paquette,(1987).
Committee of Definitions 1960, p. 21. Hoffman k. Douglas, Bateson John E.G., Marketing of Services, 2006, Cengage learning products, New
A product can be defined as a mix of intangibles and tangibles offered by the marketer at a price. A customer by the product by paying the price. This definition does not make a distinction between products and services. As we have been arguing in the earlier chapters, the distinctions between a product and a service are blurring, and it is difficult to find a completely tangible 'product' and a completely intangible 'service in the true sense of these earlier definitions. We may. if we wish co, all the predominantly intangible offerings 'services'. while the predominantly, tangible offerings can be term are products. The Service Product Concept The service firm has to differentiate its services from the competitors to create its own position in the minds of the customers. Differentiation gives the service its own position in the face of competition. A variation in the offering can differentiate the total service product offering. A very good model that helps understand how service differentiation can be achieved is therefore Levitt's Product concept mode. The different levels are called core benefit, basic service product, augmented product service, and potential service, illustrated in the diagram below.
Figure-1 The Service Product Concept
CHARACTERISTICS OF SERVICES5 a) Intangible - Service cannot have a real, physical presence as does a product. Services cannot be seen, tasted, felt, heard, or smelled before purchase. Regan (1963) introduced the idea of services being “activities, benefits or satisfactions which are offered for sale, or are provided in connection with the sale of goods”. The degree of intangibility has been proposed as a means of distinguishing between products and services (Levitt, 1981). Darby and Karni (1973) and Zeithaml (1981) highlight the fact that the degree of tangibility has implications for the ease with which consumers can evaluate services and products. Hence consumers tend to look for evidence of quality and other attributes for satisfaction. For example, motor insurance may have a certificate, but the financial service itself cannot be touched i.e. it is intangible. b) Perishability – Service once it has occurred it cannot be repeated in exactly the same way. Services cannot be stored for later sale or use. Onkvisit and Shaw (1991) suggest that services are “time dependent” and “time important” which make them very perishable. For example, once a 100 metres Olympic final has been run, there will be not other for 4 more years, and even then it will be staged in a different place with many different finalists. c) Variability- The human involvement of service provision means that no two services will be completely identical. Quality of services depends on who provides them and when , where and how. It refers to the potential for high variability in the performance and the quality of services, caused by the interaction between the service employee and the customerFor example, returning to the same garage time and time again for a service on your car might see different levels of customer satisfaction, or speediness of work. d) Inseparability- Services are produced and consumed at the same time, unlike goods which may be manufactured, then stored for later distribution. This means that the service provider becomes an integral part of the service itself. Services cannot be separated from their providers. It refers to the simultaneous production and consumption of services. Inseparability is taken to reflect the simultaneous
delivery and consumption of services (Regan 1963). The client also participates to some extent in the service, and can affect the outcome of the service. People can be part of the service itself, and this can be an advantage for services marketers. e) Right of ownership – In service ownership sis not taken to the service, since you merely experiences it. For example, an engineer may service your air-onditioning, but you do not own the service, the engineer or his equipment. You cannot sell it on once it has been consumed, and do not take ownership of it.
FAST FOOD INDUSTRTYAN OVERVIEW
India is a country of striking contrasts and enormous ethnic, linguistic, and cultural diversity. It has a population of 1.1 billion, and it is comprised of 28 states and seven Union Territories (under federal government rule). The states differ vastly in resources, culture, food habits, living standards, and languages. Vast disparities in per-capita income levels exist between and within India’s states. About 75 percent of the country’s people live in its 550,000 villages; the rest in 200 towns and cities. There are 27 cities with a population above one million people. Some observers of India’s economic scene are, however, highly optimistic about consumption growth potential, and believe that rising income levels, increasing urbanization, a changing age profile (more young people), increasing consumerism, a significant rise in the number of single men and women professionals, and the availability of cheap credit will push India onto a new growth trajectory. These segments of the population are aware of quality differences, insist on world standards, and are willing to pay a premium for quality. Nonetheless, a major share of Indian consumers has to sacrifice quality for affordable prices. Potential US exporters should also bear in mind that India’s diverse agro-industrial base already offers many items at competitive prices. RECENT TRENDS6 India's economy is on the fulcrum of an ever increasing growth curve.The middle class of India has not been satisfactorily measured. It is very heterogeneous and its size depends on the definitions of several parameters. Estimates range from 25 million to 200 million but it is generally accepted that it is growing. FVG exporters are likely to find the greatest opportunities in the markets serving the middle and upper income groups of India. Eating out is a very popular activity while attending other functions. It is estimated that Indians spend INR 350 billion7 eating out annually. Of this, organized establishment’s accounts for only INR 20 billion8. International fast food chains such as Subway, McDonald's and Pizza Hut are found in shopping malls and near cinema theatres. The "well-off” in urban areas are increasingly eating out in coffee shops, malls or retail stores. Lounge bars are the latest trend in urban areas and are frequented by
http://www.ud.camcom.it/internazionaliz/int_iniz/allegati%20india/foodreport.pdf www.isb.edu 8 Ibid note 2
young professionals, successful executives and single women in their late 20's. This trend began in Mumbai, Bangalore, Delhi and Kolkata and will no doubt spread to other urban areas. Middle to upper income families are increasingly two income, younger families. A small proportion of Indian families are moving to quick ready-to-eat foods and frozen foods. India has been at the crossroads of many peoples and cultures over the centuries, some foreign elements have invariably seeped into the local culinary culture. Thus, India’s culinary tradition is constantly changing. Nonetheless, Indians have a strong preference for fresh products and traditional spices and ingredients, which has generally slowed the penetration of American and other Western-type foods. However, with urbanization, rising incomes, more working women, the arrival of some food multinationals, and a proliferation of fast food outlets, the acceptance of packaged and ready-to-eat food products is increasing, especially among the urban middle class. These products, nonetheless, are usually tailored to Indian tastes. Many Indians are quite willing to try new foods, but usually return to traditional fare. While Western foods have a reasonably good chance of succeeding in casual dining, integrating them into the main meal will be more difficult. FRANCHISING Franchising has been operating in India for several decades. India does not have any specific law on franchising. Franchising is covered within the broad definition of transfer of technology contained in domestic legislations. A legal framework for new franchisers interested in setting up master franchises in India however exists, in terms of brand protection and rules regarding payment of franchise fees. Some of the features of the Indian franchising industry are as follows9: Wide spread sectors (from education to hospitality) Over 40,000 franchisees currently Annual turnover from franchising – approximately $2.2 billion Total investments made by franchisees – approximately $1.1 billion Over 300,000 people directly employed by franchised businesses Variety of hybrid formats in practice
Supra note on
Numerous international franchises already existing and rapidly expanding Franchising is another way of introducing Western products. Companies with franchises in the food sector in India include McDonalds, KFC, Domino’s Pizza, Baskin Robbins, Wimpy’s, TGIF, Ruby Tuesday, and Pizza Hut. Indian companies with strong brand recognition also franchise. Direct marketing, although becoming more popular, is still limited. FOOD REGULATIONS In addition to meeting a country’s sanitary and phytosanitary requirements, food must comply with the local laws and regulations to gain market access. These laws ensure the safety and suitability of food for consumers and, in some countries, also govern food quality and composition standards. Food regulatory requirements may be based on several factors such as whether a country adopts international norms developed by the Codex Alimentarius Commission of the Food and Agriculture Organisation of the United Nations and the World Health Organisation; good agricultural and manufacturing practices; or has its own suite of food regulations. Each country regulates food differently and has its own food regulatory framework. Usually more than one agency is involved (e.g. health and agriculture), they may have centralised or regionally controlled food regulations, and different agencies may be involved in enforcement activities. Strict labelling rules have been introduced by the Indian Government to protect the rights of consumers. The Food Safety and Standards Act, 200610 prohibits the manufacture, distribution or sale of any packaged food product which is not marked and labelled in the manner specified by regulations. Labels shall not be false or misleading, including in regard to implied health claims or place of origin of the food product. Importers of packaged food products must adhere to laws requiring labelling information that includes the name and address of the importer, generic or common name of the product, the net quantity, date of manufacture, best-before date and maximum sales price including any taxes or charges.
Non-vegetarian food (any food which contains whole or part of any animal including birds, marine animals, eggs, or product of any animal origin as an ingredient, excluding milk or milk products), must have a symbol of a brown color-filled circle inside a square with a brown outline prominently displayed on the package, contrasting against the background on the principal display panel, in close proximity to the name or brand name of the food. Vegetarian food must have a symbol of a green color-filled circle inside a square with a green outline prominently displayed on the package, contrasting against the background on the principal display panel, in close proximity to name or brand name of the food. A new national regulatory body, the Food Safety and Standards Authority of India, is established to develop science based standards for food and to regulate and monitor the manufacture, processing, storage, distribution, sale and import of food so as to ensure the availability of safe and wholesome food for human consumption
Food Safety and hygiene
Food safety is a growing concern across the world. There is increasing need to provide greater assurance about the safety and quality of food to consumers. The increase in world food trade and the advent of the Sanitary and Phytosanitary (SPS) Agreement under the World Trade Organization (WTO) have lead to increasing recognition and adoption of food safety measures. The capacity of India to penetrate world markets depends on its ability to meet increasingly stringent food safety standards imposed in developed countries. Food standards are expected to acquire greater importance given increasing concerns on food safety on the back of breakout of diseases such as BSE, Avian Influenza, Bird Flu etc on the one hand, and growing consumer demand for products which are healthy on the other. Compliance with international food standards is a prerequisite to gain a higher share of world trade.
SERVICE EXPEREINCETHE CONCEPT
Companies are competing strategically through service quality for greater differentiation in today's competitive marketplace. Because of the intangible nature of service products, service knowledge is acquired differently than knowledge pertaining to goods. For example, consumers can sample tangible dominant products such as soft drinks and cookies prior to purchase. In contrast, a consumer cannot sample an intangible dominant product such as haircut, a surgical procedure, or a consultant’s advice prior to purchase. Hence, service knowledge is gained through the experience of receiving the actual service itself. Ultimately, when a consumer purchases a service, he or she is actually purchasing an experience. All products, be they goods or services, dseliver a bundle of benefits to the consumer. The benefit concept is the encapsulation of these tangible and intangible benefits in the consumer’s mind. For tangible dominant good such as Tide laundry detergent, for example, the core benefit concept might simply be cleaning. However for other individuals, it might also include attributes built into the product that go beyond the mere powder or liquid, such as cleanliness, whiteness, and/or motherhood. The determination of what the bundle of benefits comprises- the benefit concept purchased by consumers- is the heart of marketing and it transcends all goods and services. In contrast to goods, services deliver a bundle of benefits through the experience that is created for the consumer. For example, most consumers of tide will never see the inside of the manufacturing plant where tide is produced; they will most likely never interact with the factory workers; and they will also generally not use tide in the company of other consumers. In contrast, restaurant customers are physically present in the ‘factory’ where the food is produced; these customers do interact with the workers who prepare and serve the food as well as with the management staff that runs the restaurant. Moreover, restaurant
customerss consume the service in the presence of other customers where they may influence one another’s service experience. Successful companies focus on the services-dominant paradigm with investment in people, technology, human resources policies, and compensation linked to service performance of employees. This is important because contact employees’ attitude and behaviour significantly influence the quality of service. They present the “face and voice” of their organizations to customers. The 4Ps marketing mix which represents Product, Process, Pricing and Promotion, have been most widely employed as a model for product marketing. It shows the company preparing an offer mix of the product and price, with an integrated promotion mix to reach the target consumers through the selected distribution channels. The 4Ps of marketing have been the key areas where marketing managers allocate scarce corporate resources to achieve the business objectives. Services have unique characteristics : intangibility, heterogeneity, inseparability and perishability. To discern the differences between services and physical products, Booms and Bitner suggested the extension of the 4Ps framework to include three additional factors : People, Physical evidence and Process as marketing mix a) Product A tangible object or an intangible service that is mass produced or manufactured on a large scale with a specific volume of units. Intangible products are often service based like the tourism industry & the hotel industry or codes-based products like cellphone load and credits. Typical examples of a mass produced tangible object are the motor car and the disposable razor. A less obvious but ubiquitous mass produced service is a computer operating system. variables for services marketing. Below is the detaile dexplanation of the 7p’s of the service marketing mix111213-:
The price is the amount a customer pays for the product. It is determined by a number of factors including market share, competition, material costs, product identity and
http://www.12manage.com/methods_marketing_mix.html http://en.wikipedia.org/wiki/Marketing_mix 13 http://www.marketingteacher.com/Lessons/lesson_marketing_mix.htm
the customer's perceived value of the product. The business may increase or decrease the price of product if other stores have the same product. c) Place Place represents the location where a product can be purchased. It is often referred to as the distribution channel. It can include any physical store as well as virtual stores on the Internet.
Promotion represents all of the communications that a marketer may use in the marketplace. Promotion has four distinct elements - advertising, public relations, word of mouth and point of sale. A certain amount of crossover occurs when promotion uses the four principal elements together, which is common in film promotion. Advertising covers any communication that is paid for, from and cinema commercials, radio and Internet adverts through print media and billboards. One of the most notable means of promotion today is the Promotional Product, as in useful items distributed to targeted audiences with no obligation attached. This category has grown each year for the past decade while most other forms have suffered. It is the only form of advertising that targets all five senses and has the recipient thanking the giver. Public relations are where the communication is not directly paid for and includes press releases, sponsorship deals, exhibitions, conferences, seminars or trade fairs and events. Word of mouth is any apparently informal communication about the product by ordinary individuals, satisfied customers or people specifically engaged to create word of mouth momentum. Sales staff often plays an important role in word of mouth and Public Relations.
People are all people directly or indirectly involved in the service encounter, namely the firm's contact employees, personnel and other customers. Due to the inseparability of production and consumption for services which involves the simultaneous production and consumption of services, service firms depend heavily on the ability of contact employees to deliver the service. Contact employees contribute to service quality by creating a favorable image for the firm, and by 21
providing better service than the competitions. Service providers (such as hair stylists, personal trainers, nurses, counselors and call centre personnel) are involved in real time production of the service. They are the “service”. Much of what makes a service special derives from the fact that it is a lived-through event. Service firms must find ways in which they can effectively manage the contact employees to ensure that their attitudes and behaviors are conducive to the delivery of service quality. This is especially important in services because employees tend to be variable in their performance, which can lead to variable quality i.e. heterogeneity in the performance of services. The quality of a service (a visit to a hospital for medical check-up, having a meal at the restaurant, accountancy and consulting services) can vary from service providers and customers among many other factors. This lack of homogeneity in services creates difficulties for the service firms. As delivery of services occurs during interaction between contact employees and customers, attitudes and behaviors of the service providers can significantly affect customers' perceptions of the service. This is important, because customers' perceptions of service quality and its value can influence customer satisfaction, and in turn, purchase intentions.
f) Physical Evidence
Physical evidence refers to the environment in which the service is assembled and in which the seller and customer interact, combined with tangible commodities that facilitate performance or communication of the service. The physical evidence of service includes all the tangible representations of service such as brochures, letterhead, business cards, reports, signage, internet presence and equipment. For example, in the hotel industry, the design, furnishing, lighting, layout and decoration of the hotel as well as the appearance and attitudes of its employees will influence customer perceptions of the service quality and experiences. Because of the simultaneous production and consumption of most services, the physical facility i.e. its servicescape can play an important role in the service experience. For theme park, restaurant, health club, hospital or school, its servicescape is critical in communicating about the service and making the entire customer experience positive. The “servicescape” illustrates how three physical environment dimensions (ambient
conditions, space/function and signs, symbols and artifacts) provide a means of understanding environment-participant relationships in service systems. As services are intangible, customers are searching for any tangible cues to help them understand the nature of the service experience. The more intangible-dominant a service is, the greater the need to make the service tangible. Credit cards are another example of the use of tangible evidence that facilitates the provision of (intangible) credit facilities by credit card companies and banks. In fact, the physical environment is part of the product itself. In summary, physical evidence serves as a visual metaphor of what the company stands for, and facilitates the activities of customers and employees.
Process is referred to the procedures, mechanisms and flow of activities by which the service is delivered i.e. the service delivery and operating systems. The process of travelling with a budget airline, is very different from that with a full-fledged premium airline. Because services are performances or actions done for or with the customers, they typically involve a sequence of steps and activities. The combination of these steps constitute a service process which is evaluated by the customers. Furthermore, in a service situation customers are likely to have to queue before they can be served and the service delivery itself is likely to take a certain length of waiting time. It helps if marketers ensure that customers understand the process of acquiring a service and the acceptable delivery times. Creating and managing effective service processes are essential tasks for service firms. Managing the process factor is essential due to the perishability of services which means that services cannot be inventoried, stored for reuse or returned. Hotel rooms not occupied and airline seats not purchased cannot be reclaimed. As services are performances that cannot be stored, it is a challenge for service businesses to manage situations of over or under demand. Another distinctive characteristics of the service process that provide evidence to the customer is the standardized or customized approach based on customer’s needs and expectations. Since services are created as they are consumed, and because the customer is often involved in the process, there are more opportunities for customizing the service to meet the needs of the customers. The first concerns the extent to which the characteristics of the service and its delivery system
lend themselves to the scope of customization; the second relates to the extent of flexibility the contact employees are able to exercise in meeting the needs of the customers. As services are dynamic and experiential, and frequently co-produced in real time by customers and employees, service firms use “service blueprinting” to better manage the service encounter and to allow clearer visualization of the service processes. Blueprinting is a method invented by Shostack (1984) to accurately portrays the service system with(i) “line of interaction” separates the customer action area from the supplier action area, (ii) “line of visibility” differentiates between actions visible and invisible to the customer, (iii) “line of internal interaction” distinguishes between front office and back office activities, (iv) “line of implementation” separates between planning, managing and controlling (management zone) and support activities (support zone). In a typical service blueprint, the customer occupies the top zone, management occupies the bottom zone and service operations are sandwiched between them. Thus, service blueprint shows how service provider can be empowered to manage the service components to bridge the gap between management intent and customer demand. As the service providers span the boundary between the firm and the customers, they can become frustrated. The role ambiguity experienced by boundaryspanning employees greatly decrease job performance, which negatively affect customers’ perception of service quality. Service experience can be studied and depicted by understanding and studying the service mix offered by the organization and the servuction model helps us to further frame the service experience.
This model used to illustrate factors that influence service experience, including those that are visible and invisible to consumer.
Invisible component consists of invisible organizations and systems. It refers to the rules, regulations and processes upon which the organization is based. Although they are invisible to the customers, they have a very profound effect on the consumers service experience. Visible part consists of 3 parts: Serviscape (inanimate environment), contact personnel/service providers, and other consumers. Servicescape- It refers to the use of physical evidence to design service environments. It consists of ambient conditionssuch as music, inanimate objects that assist the frm in completing is tasks, such as furnishing and business equipment. All non-living features present during service encounter. Contact personnel: :Employees other than primary providers that interact with consumer. Service Provider: Primary provider of core service, such as dentist, physician or instructor. Other Customers- Customer A : Recipient of bundle of benefits created through service experience and customer B : Other customers who are part of Customers A’s experience. Servuction model demonstrates consumers are an integral part of service process. The Slevel of participation may be active or passive, but always there. Managers must understand the interactive nature of services and customer involvement in production process. The four components of the servuction model combine to create the experience for the consumer and it is the experience that creates the bundle of benefits for the consumer.
MC DONALD’S –THE ORGANISATION
Serving billions of hamburgers has put a shine on these arches. McDonald's is the world's #1 fast-food company by sales, with about 32,00014 restaurants serving burgers and fries to 52 million people in about 120 countries. (There are nearly 14,000 Golden Arches locations in the US.) The popular chain is well-known for its Big Macs, Quarter Pounders, and Chicken McNuggets. Most of its outlets are free-standing units, but McDonald's also has many units located in airports and retail areas. Each eatery gets its food and packaging from approved suppliers to ensure that a Big Mac purchased in Pittsburgh tastes the same as one bought in Beijing. Nearly 80% of the restaurants are run by franchisees or affiliates. More than 70% 15of McDonald's restaurants worldwide are owned and operated by independent local men and women. Mc Donalds Mission Statement "McDonald's vision is to be the world's best quick service restaurant experience. Being the best means providing outstanding quality, service, cleanliness, and value, so that we make every customer in every restaurant smile." PRINCIPLES OF THE ORGANISATION Principles that guide the organisaiton-:
Quality, Service, Cleanliness & Value - It is an unflinching McDonald's ideology that the customers must always get quality products, served quickly and with a smile, in a clean and pleasant environment; and all at a fair price. They are committed to exceeding our customers' expectations in every restaurant every time. They have a passion and a responsibility for enhancing and protecting the McDonald's brand. Believe in a collaborative management approach, employing a mutually respectful business philosophy, Will seize every opportunity to innovate and lead the industry on behalf of the customers.
McDonald's was started as a drive-in restaurant by two brothers, Richard and Maurice McDonald in California, US in the year 1937. The business, which was generating $200,000 per annum in the 1940s, got a further boost with the emergence of a revolutionary concept called 'self-service.' The brothers used assembly line procedures in their kitchen for mass production. Prices were kept low. Speed, service and cleanliness became the critical success factors of the business. By mid-1950s, the restaurant's revenues had reached $350,000. The business began in 1940, with a restaurant opened by siblings Dick and Mac McDonald in San Bernardino, California. Their introduction of the "Speedee Service System" in 1948 established the principles of the modern fast-food restaurant. As word of their success spread, franchisees started showing interest. At this point, Ray Kroc (Kroc), distributor for milkshake machines. Expressed interest in the business, and he finalized a deal with the McDonald brothers in 1954. He established a franchising company, the McDonald System Inc. and appointed franchisees. In 1961, he bought out the McDonald brothers' share for $2.7 million and changed the name of the company to McDonald's Corporation. In 1965, McDonald's went public. The present corporation dates its founding to the opening of a franchised restaurant by Ray Kroc, in Des Plaines, Illinois on April 15, 1955, the ninth McDonald's restaurant overall. With the successful 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. Currently McDonald's operates in 121 countries & having more than 30000 restarunt and serving 53 million customers everyday. TIMELINE OF THE ORGANISATION17 1955-Ray Kroc opens his first restaurant in Des Plaines, Illinois and the McDonald's Corporation is created 195719591961196319641965196719681972197319741983Quality, Service, Cleanliness and Value (QSC& V) becomes the company motto. The 100th McDonald's opens in Chicago. Hamburger University opens in Elk Grove, near Chicago One billion hamburgers sold. Ronald McDonald makes his debut. Filet-O-Fish sandwich is introduced. McDonald's Corporation goes public. The first restaurants outside of the USA open in Canada and Puerto Rico. The Big Mac is introduced. The 1,000th restaurant opens in Des Plaines, Illinois. A new McDonald's restaurant opens every day. The Quarter Pounder is introduced. Egg McMuffin is introduced. The first Ronald McDonald House opens in Philadelphia. The Happy Meal is launched. Chicken McNuggets is introduced. New Hamburger University campus opens in Oak Brook, Illinois. Set in 80 wooded acres. Training is provided for every level of McDonald's management worldwide. 50 billionth hamburger sold. 1984Ronald McDonald Children's Charities is founded in Ray Kroc’s memory to raise funds in support of child welfare.
McDonald's is listed on the Frankfurt, Munich, Paris and Tokyo stock exchanges. McDonald's opens in Pushkin Square and Gorky Street, Moscow. The first McDonald's at sea opens aboard the Silja Europa, the world's largest ferry sailing between Stockholm and Helsinki. Restaurants open in Bahrain, Bulgaria, Egypt, Kuwait, Latvia, Oman, New Caledonia, Trinidad and United Arab Emirates, bringing the total to over 15,000 in 79 countries on 6 continents.
McDonald's opens in India – the 95th country. The first McDonald’s restaurant opened on Oct. 13, at serving beef on its menu Basant Lok, Vasant Vihar, New Delhi. It was also the first restaurant in the world not
The first Drive –Thru restaurant at Noida The first Mall location restaurant at Ansal Plaza – New Delhi The first highway restaurant at Mathura The first thematic restaurant at Connaught Place The first restaurant in a food court at 3C’s, Lajpat Nagar and the first restaurant at the Delhi Metro Station at Inter State Bus Terminus
The McDonald's Corporation's business model is slightly different from that of most other fast-food chains. In addition to ordinary franchise fees, supplies, and percentage of sales, McDonald's also collects rent, partially linked to sales. As a condition of the franchise agreement, the Corporation owns the properties on which most McDonald's franchises are located. The UK business model is different, in that fewer than 30% of restaurants are franchised, with the majority under the ownership of the company. McDonald's trains its franchisees and others at Hamburger University in Oak Brook, Illinois. According to Fast Food Nation by Eric Schlosser (2001), nearly one in eight workers in the U.S. have at some time been employed by McDonald's. (According to
a news piece on Fox News this figure is one in ten). The book also states that McDonald's is the largest private operator of playgrounds in the U.S., as well as the single largest purchaser of beef, pork, potatoes, and apples. The selection of meats McDonald's uses varies with the culture of the host country. GLOBAL OPERATIONS19 McDonald's has become emblematic of globalization, sometimes referred as the "McDonaldization" of society. The Economist magazine 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. The EFTA countries are leading the Big Mac Index with the top 3 most expensive Big Mac's. Iceland has the most expensive Big Mac, followed by Norway and Switzerland. The brand is known informally as "Mickey D's" (in the US and Canada), "Macky D's" (in the UK), "Mäkkäri" (in Finland), "McDo" (in France, Quebec, the Philippines, and the Kansai region of Japan), "Maccer's" (in Ireland), "Macarrannis" (in Mexico), "Maccas" (in New Zealand and Australia), "McD's" (in New Zealand), "Donken" (in Sweden), "de Mac" (in the Netherlands), or "Mac" (in Brazil). 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. Careful historians point to the 1989 United States invasion of Panama, NATO's bombing of Serbia in 1999, and the 2006 Lebanon War as exceptions. 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 (Stanford University Press, 1998, edited by James L. Watson) 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. In East Asia in particular, McDonald's have become a symbol for the desire to embrace Western cultural norms. McDonald's have recently taken to partnering up with Sinopec, China's second largest oil company, in
the People's Republic of China, as it begins to take advantage of China's growing use of personal vehicles by opening numerous drive-thru restaurants. MCDONALDS IN INDIA McDonald's opened its doors in India in October 1996. Ever since then, Mc Donalds family restaurants in Mumbai, Delhi, Pune, Ahmedabad, Vadodara, Ludhiana, Jaipur, Noida Faridabad, Doraha, Manesar and Gurgaon have proceeded to demonstrate, much to the delight of all the customers, what the McDonald's experience is all about. The first restaurant opened on 15th April 1955 in Des Plaines, Illinois, U.S.A. Almost 50 years down the line, its are the world's largest food service system with more than 30,000 restaurants in 100 countries, serving more than 46 million customers every day. LOCALLY OWNED McDonald’s in India is a 50-50 joint venture partnership between McDonald’s Corporation [USA] and two Indian businessmen. Amit Jatia’s company Hardcastle Restaurants Pvt. Ltd. owns and operates McDonald's restaurants in Western India. While Connaught Plaza Restaurants Pvt. Ltd headed by Vikram Bakshi owns and operates the Northern operations. Amit Jatia and Vikram Bakshi are like-minded visionaries who share McDonald's complete commitment to Quality, Service, Cleanliness and Value (QSC&V). Having signed their joint-venture agreements with McDonald's in April 1995, they trained extensively, along with their Indian management team, in McDonald's restaurants in Indonesia and the U.S.A. before opening the first McDonald’s restaurant in India. RESPECT FOR LOCAL CULTURE McDonald's India has developed a special menu with vegetarian selections to suit Indian tastes and preferences. McDonald's does not offer any beef or pork items in India. Only the freshest chicken, fish and vegetable products find their way into the Indian restaurants. In addition, they have re-formulated some of the products using spices favoured by Indians. Among these are McVeggie burger, McAloo Tikki burger,
Veg. Pizza McPuff and Chicken McGrill burger. We've also created eggless sandwich sauces for our vegetarian customers. Even our soft serves and McShakes are egg-less, offering a larger variety to our vegetarian consumers. Don’t offer any beef or pork item in India. In product like mcveggie, pizza mcpuff etc.they use spices favoured by Indians. Soft serves and mcshakes are eggless. Actively involver in many social activities likegi child education, pulse polioi etc. INTERNATIONAL STANDARDS McDonald's India's local suppliers provide us with the highest quality, freshest ingredients. Complete adherence to the Indian Government regulations on food, health and hygiene is ensured, while maintaining our own recognized international standards. Fast, friendly service - the hallmark of McDonald's restaurants the world over is the mantra we abide by. Stringent cleaning standards ensure that all tables, chairs, highchairs and trays are sanitised several times each hour. Such meticulous attention to cleanliness extends beyond the lobby and kitchen to even the pavement and immediate areas outside the restaurant. PRODUCTS20 McDonald's predominantly sells hamburgers, various types of chicken sandwiches and products, french fries, soft drinks, breakfast items, and desserts. In most markets, McDonald's offers salads and vegetarian items, wraps and other localized fare. This local deviation from the standard menu is a characteristic for which the chain is particularly known, and one which is employed either to abide by regional food taboos (such as the religious prohibition of beef consumption in India) or to make available foods with which the regional market is more familiar (such as the sale of McRice in Indonesia). ADVERTISING
McDonald's has for decades maintained an extensive advertising campaign. In addition to the usual media (television, radio, and newspaper), the company makes significant use of billboards and signage, sponsors sporting events from ranging from Little League to the Olympic Games, and makes coolers of orange drink with their logo available for local events of all kinds. Nonetheless, television has always played a central role in the company's advertising strategy. To date, McDonald's has used 23 different slogans in United States advertising, as well as a few other slogans for select countries and regions. At times, it has run into trouble with its campaigns. CONTRIBUTION TO ECONOMIC GROWTH21 McDonald's India has already contributed directly & indirectly Rs. 95 crore (approx. 16 per cent of total turnover) as revenue to the Center and the State towards Sales Tax, House tax and Income Tax in the last seven years. By 2010 this amount shall see an increase of more than 30 per cent per annum.
Supra note 19
The following chapter details out the data collected on the field study through a structured questionnaire and open ended interview of the manager. The field study was conducted at Mc Donald’s jodhpur outlet. The sample of the field study were 15 consumers of the services provided by the fast food chain outlet and the manager of the outlet at jodhpur was interviewed in order to fulfill the objectives of the project. From the Manager a) Distribution center in Noida. The Burger breads are delivered monthly and the method of preparation of the burger was standardized from the parent and it was strictly followed. b) The jodhpur outlet has not yet introduced the delivery or a take away window system. c) The menu is strictly in accordance with the menu at all places in India. d) The salads are not introduced in the Indian menu of the Mc Donald’s. e) Mc Donald is an all age group restaurant.
f) The employees at the outlet are categorized according to Vegetarians and nonvegetarians. The aprons of the employees is the visible differentiation. Staff responsible for Vegetarian food wear green aprons whereas the one’s taking care of the non-veg section can be identified with the Maroon aprons. g) Self Service System h) Difficulties Faced in Maintaing the service levels i) ii) iii) Cost maintenance Supply chain problems Motivating and sustaining employee commitment
From the Customers The sample was a mix of both vegetarians and non vegetarians. The vegetarians being 6 and the non vegetarians being 9 in number. The sample age group ranged as stated below10-18:20-26:35-above:5 10 5
1) Frequency of visit
The customers were asked regarding their frequency of visit to th e jodhpur outlet and the samples answer are graphically presented below. Majorly were weekly visitors to the outlet. The age group 20- 26 majorily consist of the weekly visitors and the occasionally were the adult age group of 35 and above. The daily being a minority also consisted of the college goers. The kids with age group 10-18 were in the weekly group.
Frequency of Visit
9 8 No of customers 7 6 5 4 3 2 1 0 daily weekly occasionally 2 0 monthly 8
2) Favourite Dish At Mc Donald’s
Food o Mc Veggie Burger o Chicken Mc Grill o Mc Chicken Burger o French fries o Chicken Nuggets Beverages o Ice Tea o Coke Desserts o Soft Serve- Chocolate
3) Quality of Food
The quality of food was asked to be rated on three groundsiv) Hot and fresh- The sample had a unanimous view on the ground. The food provided at the outlet is every time hot and fresh. They had never faced a variability with respect to the fresh aspect of the food served.
And it was mild hot which the consumer ca consume immediately and not hot as just out of an oven. v) Tasty- The sample varied here and gave two different views. The views ranged between two“yummy” and “good”.
8.2 8 no of consumers 7.8 7.6 7.4 7.2 7 6.8 6.6 6.4 yummy good Series1 7 8
Variety- the variety of the food available at the Mc Donald’s jodhpur outlet was asked and the sample was of the view that the variety here is very restricted and the menu is of a restricted menu with only limited stuff available. But there wasn’t any dissatisfaction regarding it because hey said that the stuff which they loved was there and they did not complain regarding the less variety available. Hence in this case it was an average opinion were the variety indeed was less but the available was compensating enough.
4) Price of the Products
The price of the product according to the majority sample was reasonable. 20% of the
sample said that the prices were cheap and they were mostly from the 20-26 age group. But the reasonable category consisted of the 35- above and 20-26 age group and the rest were in the costly bracket. Price of the product
2, 13% very costly costly reasonable cheap
The area of location of the Mc Donald’s was considered to be good. The outlet is situated in a mall( Ansal Plaza) and after its full-fledged opening it would be a convenient place for the customers. The parking space availability adds on to the plus points of the outlet as there is no problem of parking there.
The ambience of the outlet is good and modernized. The ambience was asked to be rated on the transport mediums available and the luxury car was chosen as the expression to describe the ambience there. The sample was of the view that there prevailed a “relaxed” kind of ambience which was immediately felt on entering the outlet.
7) Other Customers
The effect of the other customers on the sample was asked and they segregagted themselves in two categories- affected and not affected. The affected said that the other customers who come to the outlet affect them as the distance between the tableds is not much and the place normally remains crowded both upstairs and downstairs. The type of people, their acts and talks affect the approximately 50% of the sample. The affected age group were the 30 and above and the kids group. other customers
8.2 8 no of customers 7.8 7.6 7.4 7.2 7 6.8 6.6 6.4 affected not affected Series1 7 8
The infrastructure was rated on as 10 point scale and all the equipments( the counter, counter computers, the tables, chairs, the trays and the storage equipments).
12 no of customers 10 8 6 4 2 0 0 point 10 point 9 point 8 4 1 point 7 Series1 10
0 point 1-6
9) Service Delivery Process
a) Quick quickness of the service
15 10 5 0 yes yes Series1 15 no 0 S1 no of customers no 0 Series1 15
10 no of customers 8 6 Series1 4 2 0 Series1 0 yes 8 not much 7 not at all 0 8 7
10)Cleanliness at Mc Donald’s
The cleanliness of the outlet was rated by the sample. The majority rated it as very clean, but some part of the sample found it average. The cleanliness pertained to both the dinning as well as the processing area. The washroom was not taken part of it because the washroom is not a part of the outlet but of the plaza. Cleanliness
14 no of customers 12 10 8 6 4 2 0 Series1 very clean 12 average 3 3 0 not clean 0 Series1 12
11)Design of the Outlet
The design of the outlet is not standardized. It varies from place to place but the inner decoration or the layout is almost or 70% the same. The design of the outlet was rated by the sample on a scale of ten. They expressed their views by saying it as ‘stylo’ outlet and but it did not find it convenient to the storey concept as the order had to be taken from the downstairs and then carried it to the top floor. Design of the outlet
12 no of customer 10 8 6 4 2 0 Series1 0 10 0 0 9 0 8 11 10-pointer scale 7 4 4 0 0-6 0 Series1 11
The image of restaurant amongst the sample was that of a-; Kool Hangout- 15 (100%) 20 min restaurant- 15 (100%) Status symbol- 6 (40%) 13) Difficulties faced The customers were asked if any problem was faced by them and the problems/ difficulties which were expressed by them were of similar kinds. The problems are listed as stated-: Availability of space especially at the weekends.
Non compliance with the 3-minute reprocessing of the order. Repetition of the order more than twice on some occasions. Crowded Going downstairs again for placing any more order. Prices on the display were false and the real bill was way above the prices calculated after taxes. The hike in prices should be displayed on the display board. Availability of the water is a problem.
14)Overall Service Experience
8 no of customers 6 4 2 0 Series1 0 10 0 9 4 8 6 10 pointer scale 7 5 0 0-6 0 4 6 5 Series1
The customers were in the end asked to rate their overall experience right from the thought of going to the Mc Donald’s to leaving the outlet. The overall ratings were given and the majority featured in the 8 pointer i.e. 40% and the rest were divided in the 7 pointer and 9 pointer.
CHAPTER-VI DATA ANALYSIS
This chapter deals with the analysis part of the project and to see as to how are or objectives fulfilled. The data tabulation has revealed the data which is required to achieve our objectives.
OBJECTIVE I- Components of the service experience rendered by McDonald’s to its customer
The service mix offered by the Jodhpur outlet of Mc Donald can be viewed as follows Product: Burgers (both vegetarian and non- vegetarian), French Fries, Wraps(both vegetarian and non- vegetarian), Chicken Nuggets, Beverages and Desserts. Price: Burgers and wraps (Rs 25 – 100), Chicken Mc Nuggets (Rs 60 – 120), French Fries ( Rs 35-60), Beverages (Rs 30-50) and Desserts (Rs 20 – 50) Cost-based and competition-based pricing. Promotion: Advertising (television commercials, internet advertising,
hoardings), Sales Promotion (toys, Happy meals), Public Relations (Ronald McDonald Foundation) Place – Branches are evenly spread out all over the country. Mc Donald has started to target the tier-II cities. There is only one outlet in jodhpur near sojati gate in Ansal Plaza. (Manufacturer – Retailer – Consumers). People - The employees in McDonalds have a standard uniform and McDonalds specially focuses on friendly and prompt service to its customers from their employees. The employees are part time workers and at jodhpur outlet they have only boys as their part time workers (not a policy). The aprens of the employees distrin guish them as the non- veg workers and veg workers. The courtesy is maintained as it as any other outlet of the McDonald’s. 47
Process - The food manufacturing process at McDonalds is completely transparent (the whole process is visible to the customers). Physical Evidence - McDonalds focuses on clean and hygienic interiors of its outlets and at the same time the interiors are attractive and the fast food joint maintains a proper etiquette at its joints. The design, furnishing, lighting, layout and decoration of the food chain as well as the appearance and attitudes of its employees will influence customer perceptions of the service quality and experiences. Now another component of the service experience can be the Servuction Model which illustrates the various invisible and visible factors which influence the customers experience. The Servuction Model of the Mc Donald can help us understand the factors that directly influence the customers service experience.
ORGANISATION S AND SYSTEMS
CONTACT PERSONNEL/ SERVICE PROVIDER
SERVICESCAPE Chairs Tables Counters
Uniforms Billing Ronald’s effigy Storage equipments Television sets Display of menus Trays Packaging Toys
OTHER CUSTOMERS In the queue Next to the tables
ORGANISATIONS AND SYSTEMS Self service Set menu (No variability) Part time workers Monthly transport of “Breads” from Noida distribution center Different storage and employees for Vegetarians and nonvegetarians Personalized formal courteous interaction Glove System 3- minute rule Franchise System
CONTACT PERSONNEL The guard Ronald
Service Provider Order Takers
OBJECTIVE II- Impact of service experience on customers at McDonald’s.
From the above detailed out aspects of components now we can analyse the impact of the service experiences offered by the Mc Donald’s at the Jodhpur outlet. The data collected by the consumers will help us to analyse the same. The sample of the field study was such that the overall view can be taken. Mc Donald’s projects itself as the ‘family restaurant’, it targets all age group and its advertisements recently are aimed at the youth(lovers). And it has promotional program for the kids. But at the jodhpur outlet it was the college goers who dominated the scene. the price of the products offered are reasonable enough and hence this place is visited quite frequently by the college goers. It has the image of “kool hangout’. The sample was very impressed by the fresh and hot food available. Except the obesity fear, the sample majority gave a thumps up to the taste and quality available. Though the variety was one aspect were the service organization definitely faces a loss. The menu is restricted but the available are of the highest quality. The prices being reasonable and within the budget of the customers. The location is also an advantage as it is in mall with adequate parking facilities and moreover it is centrally located, not far off from any places in jodhpur so the consumers when decide to eat out, it seems a very viable option. The ambience again was categorized as ‘relaxed’. The transport medium of measuring ambience gave the answer as the luxury car. The modernized appearance and the relaxed atmosphere adds on to the enhancement of the service experience of the customer. But at a restaurant the service provider is of the utmost importance- the delivery of the service by him/ her is the ultimate impact . hence the peole and service quality holds the key to the impact on the customers. The sample gave a unanimous ‘yes’ to the quickness of the service delivered. And the courteous part was also illustrated by them. They felt nice and wanted by the courtesy showed to them at the counter by the order takers. Thought this has been the standardized practice yet it leaves a good impact on each of the customer and makes him want to come back. Living in a place which cherishes and adorns itss heritages and traditions, the people are accustomed to courteous behaviour which is being rightly managed on the part of the employees there.
The cleanliness at the Mc Donalds was evident and the process was visible which enhanced the confidence and helped the consumers to make a judgement on the service organization. The majority supported the “very clean” view and stated that cleanliness was the major plus point of their visiting the place so frequently. The hygienic conditions prevalent here is of such high standards which should be followed by all the restaurants. The consumers compared the cleanliness aspect at other restaurants and ranked the outlet best in the matter of cleanliness. But the outlet was said to be designed in an inconvenient manner. The floor system was expressed as an inconvenience to th econsumers sitting upstairs. This is different from the usual style was the Mc Donald’s outlet which may be spread out on a huge space biut not the floor system. The experience of the customers sitting downstairs is different from the customers sitting upstairs. The downstairs gave an outside view of the small lawn planted at the ansal but upstairs gave a closed feeling. The major plus point of the outlet is that the consumers have a an image of what the outlet wants to portrays- a 20-minute restaurant, where the consumer can enjoy himself / herself and have an intake of tasty food. Its for the people who have little time and have to rush , its for the people who have come to hangout with friends, its for people who have come to celebrate some occasion. It ensures safety by the guards and the location and its crowd is usually of the college goers. In this the major force behind coming back to this place is the favorites (be it burgers, mcpuffs etc.) which are available hot, fresh and quick anytime. The infrastructure was rated as good i.e point 8 , because of the some what uncomfortable ness of the chairs at the store which again are standardized and all the Mc Donald outlets have the same. The service at the store was appreciated and given a ‘good”. The billing process was also very neat and transparent. But the prices on the display board did create a feeling of being cheated. The counters are not adequately placed. The vegetarians felt confident of the clean and separate process of the food stuff kept according to the categories of – Veg and Non- Veg. the employees distinction on the same basis was even more convincing hence didn’t hesitate to come at the place free of the doubt of any mixing of the two. Overall experience was rated – good by the consumer. The service experience rendered by the mc Donalds is received well by the consumers and its impact on them is as expected. The rating is 8 according to the sample and the organization has been successful in positioning itself as the affluent, westernized
teenager, modern , upscale family, possibly driven by children who enjoy the feeling of eating at the Mc Donalds.
OBJECTIVE III- challenges in maintaining and improving the service experience rendered by McDonald’s.
After looking at the impact of the service experience offered by the Mc donald’s on the consumer we can now look into the third objective which will help us to complete our view on the service experience at the Mc Donald. The manger had stated in the interview the difficulties faced. The staff employed is not a professional skilled workers as the work is more based on high technology hence requiring low skilled workers, hence the turnover seen in this is high. The training though not of a high standard but yet consumes time and money. The supply chin management is another problem which the management face. As stated they have a monthly supply of the breads and this is supply is approximated hence as the peak demand any result in under stocking and too low demand can lead to overstocking which affects the level of service rendered at mc Donald’s. The demand has wide fluctuations. The relationship that the Mc Donald shares with its customers is formal relationship and not a membership one. Another difficulty faced in maintains the standard is the cost maintainace. The prices are more of a competition based and the prices of the products have been raised recently and may further see the increase and hence bring a doubt over its image of the “Baap Daada ke Zamne ke Dam”. The servicing staff has to be also continuously motivated and encouraged to act in the set manner and be as sweet and courteous and patient to the customers. Because in the end the customer should say – “ I’ M LOVIN’ IT”.
Fast food restaurant is that part of service industry which is ‘balanced’ i.e. the dominance of tangibles and intangibles is equally divided. In this industry it is more of people processing i.e. it is directed at the people and the nature is that of a tangible act. Mc Donald’s employs a cold chain system22. The above chapters clearly lay out in detail the components of the service experience offered by the MC Donald’s to the consumers and the impact of the same on the consumers. The 7 p’s of the service marketing mix is the major component of the service experience rendered by the Mc Donald’s to its customers. Service experience is not only what you get when you arrive at the place but also what happens when you think about it and what your thoughts are when you leave for the outlet. The jodhpur outlet following the franchise way gives the service experience in the standardized way but as the inherent quality of variability surrounds every service rendered hence the views and the experience also differs. Hence, the
Cold chain is a logistic system that provides a series of facilities for maintaining ideal storage conditions for perishables from the point of origin to the point of consumption in the food supply chain
overall ratings define clearly the same. The Servuction model is another tool to understand the impact of the customers of the various factors i.e. service experience rendered by the MC Donald’s. the model has helped depict what are the various influencing factors and the data tabulation reveals the impact of the same. The service organization has been successful in positioning itself as the affluent, westernized teenager, modern, upscale family, possibly driven by children who enjoy the feeling of eating at the Mc Donald’s. Hence, the Mc Donald’s at jodhpur can ensure that its consumers are saying – “I’ m lovin’ it”.
1. Membership participation of the consumers- the Mc Donald’s follows formal relationship but doesn’t involve its customers for further association. The membership clubs or helping the Mc Donald’s members (through some enrolment process) on some issues or topics eg- Backpacking or Trekking etc. 2. Television sets to be placed appropriately- the television sets are placed at the outlet in an inappropriate manner. The upstairs 2 television sets are not placed in a manner in which all consumers can have a good look at it from different places. 3. Water Availability- The water availability at the store should be made. Right now they provide with a small glass of water and that also after asking for the same twice. This may be due to the fact that beverages should be sold and if water is provided for free it may lead to non- purchase of the beverages. 4. Space Between the Counters- there isn’t any clear cut division between the three counters hence when the order takers ask the customer to step to their left after placing the order , their no actual space to shift to the left at the first two counters. Hence the counters should be placed in a way that they are equally spaced and have enough gap amongst themselves. 5. Storey story- the storey concept has really lead to the dampening of the rating of the design of the outlet. As the plaza opens up, the outlet should adequately cover up for this dampener. 6. Menu Prices- The price displayed should be reviewed accordingly and the revised prices should be stated at the display. 55
7. Salads- Mc Donald’s has introduced the salads concept in various other countries but not yet in India. Seeing the growth of health conscious generation salads should be introduced in the menu card of India too.
BOOKS Hoffman k. Douglas, Bateson John E.G., Marketing of Services, 2006, Cengage learning products, New Delhi 2008. 56
Rajendra Nargundkar, Service Marketing- Text and Cases, 2nd edn, McGraw Hill Companies, New Delhi 2008. Cooper, Robert G. and Scott J. Edgett (1999), Product Development for the Service Sector:Lessons for Market Leaders. Cambridge, MA: Perseus Books. Kurtz, David L. and Kenneth E. Clow (1998), Services Marketing. New York: John Wiley & Sons. WEBSITES http://www.slideshare.net/kriskate/extended-marketing-mix http://www.oppapers.com/essays/Macdonald-The-Marketing-Mix/212438 http://www.emeraldinsight.com/Insight/viewContentItem.do?contentType=Article &hdAction=lnkpdf&contentId=870577 http://www.icmrindia.org/casestudies/Case_Studies.asp?cat=services%20marketi ng http://www.icmrindia.org/casestudies/catalogue/services%20marketing/CLSM017 .htm http://www.scribd.com/doc/13212962/extendedmarketingmix1234428594801660 1?autodown=ppt http://www.aueb.gr/users/esaopa/courses/part2.pdf http://cruftbox.com/blog/archives/001411.html http://www.oppapers.com/essays/Service-Marketing-Pizza-Hut/160111 http://cruftbox.com/blog/archives/001411.html http://www.slideshare.net/kriskate/extended-marketing-mix http://www.oppapers.com/essays/Macdonald-The-Marketing-Mix/212438 http://www.oppapers.com/essays/Service-Marketing-Pizza-Hut/160111 http://www.emeraldinsight.com/Insight/viewContentItem.do?contentType=Article &hdAction=lnkpdf&contentId=870577 http://www.aueb.gr/users/esaopa/courses/part2.pdf http://www.gremler.net/SERVSIG/Services_Textbooks.PDF
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QUESTIONNAIRE FOR CUSTOMERS
NAME-______________________________ AGE-________________________________ OCCUPATION-_______________________ Vegetarian/ Non- Vegetarian- _____________ Q 1) What is the frequency of your visit to the Mc Donalds ? 59
Q 2) Which is your favorite dish at Mc Donalds? Q 3) How do you find the quality of food provided at Mc Donalds? a) Hot and Fresh b) Tasty c) Varierty Q 4) What do you think of the price of the products available at the Mc Donalds? a) Very Costly b) costly c) reasonable d) cheap Q 5) Do you like the area at which Mc Donald’s is situated? Q 6) What do you think about the ambience prevalent at Mc Donalds? Q7) Are you affected by the presence of the other customers? If yes, then in what way? Q 8) What do you think of the infrastructure of the Mc Donald’s outlet? Q 9) How do you find the service delivery process at the outlet? a) Quick b) Impressive Q 10) What are your views regarding the cleanliness at the Mc Doanlds? Q11) Rate the design of the outlet on a scale of ten? Q12) What image do you have of the Mc donalds? Q13) Did you face any difficulty or problem at the Mc Donald’s outlet? Q14) Rate your overall service experience on a ten pointer scale?