SERVICE MARKETING MIX

ON MCDONALDS
Aditya.S.Betala
Varun.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
Industrial Analysis Source-www.mcdonalds.com
 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.

Operational Formats of McDonalds

Source- http://research-methodology.net/mcdonalds-value-chain-analysis/
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 fit
High employed turnover
Price competition
Controlling quality with franchised operation
Negativity publicity-unhealthy food menu
• Opportunities
Upscale restaurants
Serving only1% of the world population
Organic food for health conscious
Expanding to new part of globe
• Threats
Sued for unhealthy food many times
Health concern
Competitors
Contamination risks
Geopolitical issue affect
 7PS OF MCDONALDS
1P-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 60etc
Psychological Connotations.
Cost Leadership.
Heavily Marketed “Happy price Menu”.
Many Combos.
Low Cost Food Franchise
Source-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. PHYSICAL EVIDENCE

CLEANNESS SPEED QUALITY TRANPARENCY

 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
McDonalds