HINDUSTAN INSTITUTE OF MANAGEMENT &

COMPUTER STUDIES
FARAH, MATHURA

Affiliated to Dr. A.P.J. Abdul Kalam Technical University,

Lucknow

PROJECT REPORT ON STP OF MCDONALD’S

SUBMITTED TO: SUBMITTED BY:

Ms. Dr. Riju Agarwal Singh jaya yadav

MBA 1ST Semester

Session – (2021-2023)
 PREFACE
The success of any business entity solely depends on how effectively
does it utilizes its optimum resources and how soon does it make
arrangements for the removal of the customer’s grievances. Moreover,
the company should always be ready to make necessary changes
according to the requirements in order to attract more customers so as
to maintain a substantial growth in the market. The topic given to me
was :-

“ SEGMENTING, TARGETING, & POSITIONING OF MCDONALD ”

I have tried to put my best efforts to complete this task on the basis of
skill that I have achieved during my studies in the institute.

I have tried to put my maximum effort to get the accurate statistical

data. If there is any error or any mistake in the collecting data , please
correct it in the best way as I am still learning.
 ACKNOWLEDGEMENT
Success is an amalgam of dedication.

Hard work and able guidance of people around us

I am indebted to my teachers who molded at this junction of my career from

where I can take off better in the competitive scenario of today’s world. Working
on this project has been a great pleasure & a stimulating experience.

Firstly I would like to express our deep gratitude to god all mighty for his blessings,
which provided me strength & patience to complete my term paper.

I would also like to convey my thanks to Mr. bill gates who have developed the Ms
Office without his contribution we would not able to make this type of attractive &
in a printed way. I would also like to thanks my friends who helped me in all
possible ways.

I am also thankful to _______________ Who provided me needed information

about their department and guided my term in the right direction.

(SIGNATURE)
 CONTENTS
1. Introduction
2. History
3. Marketing strategy
4. Brand mascot of McDonald’s
5. Market segmentation
6. Target market selection
7. Positioning
8. Selection strategies
9. Marketing mix
10. Recommendations
11. Conclusion
12. bibliography
 INTRODUCTION TO MCDONALS

McDonald's is an American fast food company, founded in 1940 as

a restaurant operated by Richard and Maurice McDonald, in San
Bernardino, California, United States. They rechristened their
business as a hamburger stand, and later turned the company into
a franchise. In 1955, Ray Kroc, a businessman, joined the company as
a franchise agent and proceeded to purchase the chain from the
McDonald brothers. McDonald's had its previous headquarters
in Oak Brook, Illinois, but moved its global headquarters
to Chicago in June 2018.

McDonald's is the world's largest restaurant chain by

revenue, serving over 69 million customers daily in over 100
countries] across 37,855 outlets as of 2018. Although McDonald's is
best known for its hamburgers, cheeseburgers and french fries, they
feature chicken products, breakfast items, soft
drinks, milkshakes, wraps, and desserts. In response to changing
consumer tastes and a negative backlash because of the
unhealthiness of their food, the company has added to its
menu salads, fish, smoothies, and fruit. The McDonald's Corporation
revenues come from the rent, royalties, and fees paid by the
franchisees, as well as sales in company-operated restaurants.
According to two reports published in 2018, McDonald's is the
world's second-largest private employer with 1.7 million employees
(behind Walmart with 2.3 million employees). As of 2020,
McDonald's has the ninth-highest global brand valuation.
 History
The first McDonald’s restaurant was opened in 1940 by brothers Maurice
(“Mac”) and Richard McDonald in San Bernardino, California. It originally was a
drive-in that offered a wide selection of items. However, in 1948 the brothers
decided to revamp the business, and after a three-month renovation, a newly
envisioned McDonald’s opened. The small restaurant was designed to produce
huge quantities of food at low prices. To achieve this, the brothers limited the
menu—which only featured hamburgers, potato chips (later replaced by
french fries), drinks, and pie—and developed a simple, efficient format that
they named the Speedee Service System. This included a self-service counter
that eliminated the need for waiters and waitresses, and customers received
their food quickly because hamburgers were cooked ahead of time, wrapped,
and warmed under heat lamps. These innovations allowed the brothers to
charge just 15 cents for a basic hamburger, about half the price of competing
restaurants. McDonald’s was a huge success, and the brothers began a
franchise program.

Appliances for McDonald’s were purchased from a salesman named Ray Kroc,
who was intrigued by their need for eight malt and shake mixers. In 1954 he
visited the restaurant to see how a small shop could sell so many milk shakes.
Realizing there was great promise in their restaurant concept, Kroc became a
franchise agent for the brothers. In April 1955 Kroc launched McDonald’s
Systems, Inc., later known as McDonald’s Corporation, in Des Plaines, Illinois,
and there he also opened the first McDonald’s franchise east of the Mississippi
River. In 1961 Kroc bought out the McDonald brothers .
 MARKETING STRATEGY
With an innovative approach to marketing and consumption patterns
through value-added menu improvements, McDonald’s aims to
significantly improve market share in key markets through continually
improving customer satisfaction and attracting new customers
through cost savings, operational efficiencies and improving brand
awareness.

So let us look at some of the marketing strategies implemented by

McDonald’s over the past years.

McDonald’s – I’m Lovin’ It…. Para Pap Pap Paa:

“I’m Lovin’ It… Para Pap Pap Paa” is a very well-known jingle that has
been used by McDonald’s for a very long time now.

This jingle highlights the positive experience one can have while
dining at McDonald’s. The jingle is memorable because it speaks
about how happy people are during their meals there, and how
helpful and friendly the employees are.

Brand Mascot of McDonald’s

What is the best McDonald’s brand mascot? A funny clown character
that McDonald’s is able to successfully market to both children and
adults. The brand mascot strategy was first implemented by
McDonald’s in 1963 and since then this mascot has become an integral
part of the company’s legacy.

SEGMENTATION, TARGETING AND

POSITIONING IN ORGANIZATIONS
 SEGENTATION, TARGETING AND
POSITIONONG are strategic marketing models used
by organizations to attract the right customers for
their goods, products or services.

 It is done to position the brand image of their

organization in the mindset of customers against their
rivals in the market.

 For a good marketing strategy it is important for a

company to understand its target customers in order to
communicate and market them products accordingly.
 SEGMENTATION

 Segmentation is the process of dividing the population

into different group of similar needs and wants.
 Segmentation is necessary to know the customer in
detail which will help to serve the customers better.
 McDonald’s has divided its consumer market into-

Geographic
Demographic
Psychographic
Behavioral
 GEOGRAPHIC SEGMENTATION
1. It segments the markets according to geographic criteria like region
and density. McDonald’s breaks its business into different geographical
segments like-

 America
 Europe
 Asia / pacific, middle east and Africa
 Other countries like Canada
2. McDonald’s optimizes its menu and price to suit the regional tastes
and needs of customers on the basis of their geographic segmentation.
3. McDonald respect cultural differences in their respective countries and
design their products accordingly. In US people tend to have beef rather
than chicken but in India and china people don’t prefer beef so ore
chicken items are included in the menu.
4. In India vegetarian burgers are included like McAloo Tikki,Mc Veggie
and Veg Pizza McPuff, Mexican Aloo Wrap.
5. In Middle East it has introduced ‘Mc Arabia’ to its
menu and in Philippines ‘Mc Spaghetti’.

6. Countries like Germany , Europe and japan

McDonald’s even sell a Draft beer as part of drinks with
their food in order to attract more adult into their business.

7. They introduced PLANT-LETTUCE-TOMATO OR PLT

SANDWICH as often promoted in Ontario , as well as
locations in London and Sarnia.

DEMOGRAPHIC SEGMENTATION
 It is based on consumer demographic variables such as Age,
Family size, gender, income ,socio economic status.
 AGE- they have targeted below Age Groups.
 CHILDREN- McDonald’s offers great features to
children’s like “ HAPPY MEALS” which is served with
favorite toys of children.
 Toys are part of the marketing strategy which aims at
attracting children to McDonald’s.
 McDonald’s had even built playgrounds for kids in the
restaurants.

 Ronald McDonald’s was introduced to target children as

their audience and make the meals more appealing to them.
 McDonald’s had even built playground for kids in the
restaurants.

 YOUNG ADULTS (BETWEEN 18-29)- This segment is

the main source of business for McDonalds. Their
 consumption pattern is much more than the other maker
segments.
 ADULTS- McDonald’s in order to target this segment
tweaked its menu and made it in less calories and healthy.
 For families they have different outlets which offer
takeaways and drive-thru.
 The Happy Meals offered by the company targets whole
family. The reason being that most parents will bring their
children in the restaurant and order something for
themselves too.

 INCOME- McDonalds make products of different price

which is affordable by low and high income group as well.
 PSYCHOGRAPHIC SEGMENTATION

 It segments the market into social class and lifestyle

of people.

McDonald's has adopted itself according to the convenience and

lifestyle of consumers in different countries. Like taste,
preference of consumers, religious beliefs and behavior of
consumers for the particular country and made changes in their
menu and modified themselves.

EXAMPLE- India has a huge vegetarian population so

McDonald’s has come up with a different and new product line
mc aloo tikki, Mc veggie . In United States people prefer beef so
more beef products are available such as Quarter pounder (beef)
burger.
 BEHAVIOURAL SEGMENTATION

 It focuses on Degree of Loyalty, Benefits Sought,

Personality, User Status and Occasions.

 OCCASSIONS -

EXAMPLE-McDonald provides party rooms for children's

birthday celebrations in order to attract more customers.

 DEGREE OF LOYALTY-Loyalty depends on how satisfied

the customers are with the product or service. McDonald's
offers its customers excellent services with less waiting time
and menu designed as per the country and preferences of
people which makes it different from other companies.
 BENEFITS SOUGHT-It is different benefits customers get
in using a product or service.

EXAMPLE- McDonald offers its customers quick service as

compared to other restaurants, price which is affordable by
low income people also and free wifi.
 TARGETING

Targeting implies selecting market segments that companies

want to focus on and then customize or position their products to
each segment.

McDonald's chooses below market segments to target for driving

their business strategy, sales and marketing.

EXAMPLE - McDonald's targets Children with 'HAPPY

MEALS' and Youngsters with Free WiFi.
▪ McDonald's targeted 'Breakfast lovers' in Australia and New
Zealand to serve breakfast during the whole day.

• They targeted Vegetarians in India and changed their menu by

introducing Vegetarian Burger.
 POSITIONING
 Positioning is a process of creating an 'image' in the mind of
consumers by which they can understand the uniqueness about your
product as compared to competitors.
 McDonald's uses segment insights i.e. values, needs and lifestyle of
each segment of the consumer behavior that are developed through
market research.
 McDonald's had developed a unique image in the mind of
consumers through their positioning strategy.
 McDonald's unique Positioning Strategies that made its brand
different from their rivals –
 They came up with the Mascot of 'RONALD MC DONALD' a
clown-shaped man that had a great attraction for children which
made children driving to the restaurants
 They advertised through Social Media and Billboards as their
mainstream to position its brand against its rivals.

McDonald's is known for 'Ronald McDonald House Charities' (RMHC)

which is an independent non-profit organization whose mission is to
create, find and support programs that directly improve the health and
well-being of children. Through RMHC they had made an impact on
consumers.
Pricing Strategy of McDonald's is a strategically tool to position its brand
and products in the consumer mind.

• McDonald's also sponsors Sporting Events like Little League, FIFA

World Cup and Olympics.
 McDonald's has established itself to be the Family friendly low cost
restaurant in the fast food business and set up an example for the
importance of having Segmentation Targeting and Positioning
Strategy for differentiating business from their competitors.
 Marketing mix
McDonald’s Corporation’s marketing mix (4Ps) involves various
approaches that meet business concerns in different fast food
restaurant markets around the world. The marketing mix defines
the strategies and tactics that a company uses to reach target
customers, in terms of products, place, promotion, and price (the
4Ps). In this business analysis case, McDonald’s has corporate
standards that its marketing mix applies globally.
For example, the company’s corporate standards for productivity
are implemented in the management of each company-owned and
franchised location. McDonald’s also applies some variations in its
marketing mix to suit the conditions of local or regional markets.
For instance, the company’s promotion strategies and tactics
focus on print media in countries where such media are most
popular, and prioritize television in other markets.
The specifics of the 4P variables define the various strategies
and tactics that McDonald’s uses in executing its marketing
plan and achieving related strategic goals to grow the
multinational restaurant chain business. McDonald’s
Corporation’s effectiveness in implementing its marketing
mix contributes to the leading performance of its brand and
business in the international fast food restaurant industry.
 McDonald’s Products (Product Mix)
As a food service business, McDonald’s has a product mix composed
mainly of food and beverage products. This element of the marketing
mix covers the various organizational outputs (goods and services) that
the company provides to its target markets. McDonald’s product mix
has the following main product lines:

1. Hamburgers and sandwiches

2. Chicken and fish
3. Salads
4. Snacks and sides
5. Beverages
6. Desserts and shakes
7. Breakfast/All-day breakfast
8. McCafé

place/Distribution in McDonald’s Marketing Mix

This element of the marketing mix enumerates the venues or
locations where products are offered and where customers can
access them. Restaurants are the most prominent places where
the company’s products are distributed. However, the business
utilizes various places as part of this 4P variable. The main places
through which McDonald’s distributes its products are as follows:

1. Restaurants
2. Kiosks
3. McDonald’s mobile apps
4. Postmates website and app, and others
 McDonald’s Promotion (Promotional Mix)
This element of the marketing mix defines the tactics that the
business uses to communicate with customers. Among the 4Ps,
this variable focuses on marketing communications with target
customers. For example, the company provides new information to
persuade consumers to purchase new products. McDonald’s uses
the following tactics in its promotional mix, arranged according to
significance in the business:

1. Advertising (most significant)

2. Sales promotions
3. Public relations
4. Direct marketing

McDonald’s Prices and Pricing Strategies

This element of the marketing mix specifies the price

points and price ranges of the company’s food and
beverage products. The aim is to use prices to
maximize profit margins and sales volume.
McDonald’s uses a combination of the following
pricing strategies:

1.Bundle pricing strategy

2.Psychological pricing strategy
 Recommendations

1. Service Differentiation: McDonald’s needs to focus on service

differentiation strategy in order to position the restaurant as a
superior service restaurant in the minds of the target consumers.
The service differentiation strategy implies that McDonald’s shall
offer superior services at each step of the customer touch points
right from the placement of order through the delivery of the
products.
2. Personnel Differentiation: The availability of well-trained staff is
essential for delivery of high quality service to the customers.
McDonald's should continue to invest in the training and
development of its employees to ensure high service quality. Well-
structured training programs shall ensure the long term growth of
the organization.
3. Integrated Promotional Mix: McDonald’s can implement an
integrated promotion mix that has a balance of both traditional and
modern digital media for brand promotions. McDonald’s must
recognize the importance of digital media in the promotional mix
for organizations, and should devise digital marketing strategies to
engage with the online customer base.
4. Product Augmentation: McDonald’s can offer additional product
and service features such as food on demand and home delivery
so as to provide convenience to customers. Product quality can
be further enhanced with fresh ingredients. McDonald’s should
continue to invest in menu customization and menu
standardization strategies to attract and connect with target
customers in diverse geographical markets.
 Conclusion on McDonald’s
Conclusion The last half of the twentieth century witnessed the
development of many fast food chains. None were as successful as
McDonald’s at maximizing profit and minimizing cost. The rapid growth
of McDonald’s from one small store in 1948, to its first restaurant in
1955, to its worldwide dominance and market saturation at the turn of
the twenty-first century, is a story of capitalist enterprise, sometimes at
its worst and (to its shareholders) sometimes at its best. The business
practices of McDonald’s are, to put it kindly, slightly suspect. By keeping
employee wages low and refraining from hiring full time workers, the
company was able to save money on health care packages and
employee benefits. In addition, McDonald’s was…show more content…

The packaging that beef is wrapped in to be given to the consumer is

used for mere minutes before being thrown away, many times landing
back on the ground, polluting the environment. When two activists had
finally had enough and spoke out against the business practices of
McDonald’s, McDonald’s sued. They however would later make clear
their intention not to collect any damages they were awarded. This was
an effort to move attention away from the negative publicity of the
McLibel case, and reclaim the positive image the case brought into
question. In each instance, McDonald’s claims they are not at fault—the
cattle ranchers are to blame for rainforest destruction, the consumer for
the litter, and the members of London Greenpeace were spreading lies.
This distancing strategy only causes McDonald’s self-promoted image of
environmental friendliness to take center stage. Thinking of McDonald’s
as a good citizen and good neighbor, America orders their hamburgers
and McDonald’s success increases.
 BIBLIOGRAPHY

http://www.mondelezinternational.com/home/index.aspx

http://www.studymode.com/essays/Opportunity-And-Threat-Of-
mcdonal’s 276842.html

https://www.McDonal’s.in/

http://www.prenhall.com/kotler