McDonald
Content
CHAPTER 1
INTRODUCTION
McDonald's fast food restaurant is one of the largest franchises in the United States as well as aboard. Their top menu items include: hamburgers, cheeseburgers, McNuggets, and French fries. They are also known for one of their popular desserts: the apple pie and their breakfast sandwich: the Egg McMuffin.
There are more than 32,000 McDonald's restaurants serving in 117 countries. More than 75% of McDonald's restaurants worldwide are owned and operated by independent owners.
McDonald's has several ethical and social responsibility policies in place throughout their solely owned and franchised companies. These policies include placing the customer experience at the core of what they do, committing to their employees by nurturing their talent and rewarding their achievements, maintaining high standards regarding the conduct for business, and giving back to the communities in which they are established. All of these values are infiltrated through all levels of the company, which keeps McDonald's thriving as a successful fast food chain restaurant.
Risk management is imperative to McDonald's. They have a risk assessment tool that they use to determine the country risk: which pertains to the specific country/region they are located in; industry risk: pertains to supplies produce; and facility risk: which is a combination of both country and risk groundwork. These factors are all part of the risk assessment tool that is used in each of their companies to help them with risk management. Security features in McDonald's includes their security camera systems within the facilities to continuously monitor all activity in and around the restaurants to ensure the safety for the workers as well as customers. McDonald's use these security cameras also in regards to workers compensation claims or liability lawsuit claims from consumers. McDonald's also monitors their computer software systems with an ACS system that monitors the technicogical factors of their business.
HISTORY
The McDonald's restaurant concept was introduced in San Bernardino, California by Dick and Mac McDonald of Manchester, New Hampshire. It was modified and expanded by their business partner, Ray Kroc, of Oak Park, Illinois, who later bought out the business interests of the McDonald brothers in the concept and went on to found McDonald's Corporation In 1937, Patrick McDonald opened "The Airdrome", an octagonal food stand, on Huntington Drive (Route 66) near the Monrovia Airport in Monrovia, California. Hamburgers were ten cents, and all-you-can-drink orange juice was five cents. In 1940, his two sons, Maurice and Richard ("Mac" and " Dick"), moved the entire building 40 miles (64 km) east, to West 14th and 1398 North E Streets in San Bernardino, California. The restaurant was renamed "McDonald's Famous Barbeque" and served over forty barbequed items. In October 1948, after the McDonald brothers realized that most of their profits came from selling hamburgers, they closed down their successful carhop drive-in to establish a streamlined system with a simple menu of just hamburgers, cheeseburgers, french fries, shakes, soft drinks, and apple pie. The carhops were eliminated to make McDonald's a self-serve operation. Mac and Dick McDonald had taken great care in setting up their kitchen like an assembly line to ensure maximum efficiency. The restaurant's name was again changed, this time to simply "McDonald's," and reopened its doors on December 12, 1948. In 1960, the McDonald's advertising campaign "Look for the Golden Arches" gave sales a big boost. Kroc believed that advertising was an investment that would in the end come back many times over, and advertising has always played a key role in the development of the McDonald's Corporation. Indeed, McDonald's ads have been some of the most identifiable over the years. In 1962, McDonald's introduced its now world-famous Golden Arches logo. A year later, the company sold its billionth hamburger and introduced Ronald McDonald, a red-haired clown with particular appeal to children. In the early 1960s, McDonald's really began to take off. The growth in U.S. automobile use that came with suburbanization contributed heavily to McDonald's success. In 1961 Kroc bought out
the McDonald brothers for $2.7 million, aiming at making McDonald's the number one fast-food chain in the country. In 1975, McDonald's opened its first drive-thru window in Sierra Vista, Arizona, following Wendy's lead. This service gave Americans a fast, convenient way to procure a quick meal. The company's goal was to provide service in 50 seconds or less. Drive-thru sales eventually accounted for more than half of McDonald's systemwide sales. Meantime, the Happy Meal, a combo meal for children featuring a toy, was added to the menu in 1979. As it was exploring new avenues of growth, however, McDonald's core hamburger chain had become plagued by problems. Most prominently, the Made for You system backfired. Although many franchisees believed that it succeeded in improving the quality of the food, it also increased service times and proved labor-intensive. Some franchisees also complained that the actual cost of implementing the system ran much higher than the corporation had estimated, a charge that McDonald's contested. In any case, there was no question that Made for You failed to reverse the chain's sluggish sales. Growth in sales at stores open more than a year (known as same-store sales) fell in both 2000 and 2001. Late in 2001 the company launched a restructuring involving the elimination of about 850 positions, 700 of which were in the United States, and some store closings. There were further black eyes as well. McDonald's was sued in 2001 after it was revealed that for flavoring purposes a small amount of beef extract was being added to the vegetable oil used to cook the french fries. The company had cooked its fries in beef tallow until 1990, when it began claiming in ads that it used 100 percent vegetable oil. McDonald's soon apologized for any "confusion" that had been caused by its use of the beef flavoring, and in mid-2002 it reached a settlement in the litigation, agreeing to donate $10 million to Hindu, vegetarian, and other affected groups. Also in 2001, further embarrassment came when 51 people were charged with conspiring to rig McDonald's game promotions over the course of several years. It was revealed that $24 million of winning McDonald's game tickets had been stolen as part of the scam. McDonald's was not implicated in the scheme, which centered on a worker at an outside company that had administered the promotions.
In July 2011, McDonald's announced that their largest restaurant in the world will be built on the 2012 London Olympics site. The restaurant will contain over 1,500 seats and is half the length of an American Football field. Over 470 staff will be employed serving on average (during the 2012 Olympics) 100,000 portions of fries, 50,000 Big Macs and 30,000 Milkshakes. This restaurant will overshadow the current largest McDonald's in the world in Moscow, Russia.
CHAPTER 2
Marketing Mix of Mcdonalds
The marketing mix of a company consists of the various elements as follows which form the core of a company’s marketing system and hence helps to achieve marketing objectives. The Service marketing mix in the case of McDonald’s is as below Product :- McDonald’s places considerable emphasis on developing a menu which customers want. Market research establishes exactly what this is. However, customers’ requirements change over time. In order to meet these changes, McDonald’s has introduced new products and phased out old ones, and will continue to do so. Care is taken not to adversely affect the sales of one choice by introducing a new choice, which will cannibalise sales from the existing one (trade off). McDonald’s knows that items on its menu will vary in popularity. Their ability to generate profits will vary at different points in their cycle. In India McDonalds has a diversified product range focussing more on the vegetarian products as most consumers in India are primarily vegetarian. The happy meal for the children is a great seller among others. Price :- The customer’s perception of value is an important determinant of the price charged. Customers draw their own mental picture of what a product is worth. A product is more than a physical item, it also has psychological connotations for the customer. The danger of using low price as a marketing tool is that the customer may feel that quality is being compromised. It is important when deciding on price to be fully aware of the brand and its integrity. In India McDonalds classifies its products into 2 categories namely the branded affordability (BA) and branded core value products (BCV). The BCV products mainly include the McVeggie and McChicken burgers that cost Rs 50-60 and the BA products include McAloo tikki and Chicken McGrill burgers which cost Rs20-3 This has been done to satisfy consumers which different price perceptions.
Promotion :- The promotions aspect of the marketing mix covers all types of marketing communications One of the methods employed is advertising, Advertising is conducted on TV, radio, in cinema, online, using poster sites and in the press for example in newspapers and magazines. Other promotional methods include sales promotions, point of sale display, merchandising, direct mail, loyalty schemes, door drops, etc. The skill in marketing communications is to develop a campaign which uses several of these methods in a way that provides the most effective results. For example, TV advertising makes people aware of a food item and press advertising provides more detail. This may be supported by in-store promotions to get people to try the product and a collectable promotional device to encourage them to keep on buying the item. At McDonalds the prime focus is on targeting children. In happy meals too which are targeted at children small toys are given along with the meal. Apart from this, various schemes for winning prices by way of lucky draws and also scratch cards are given when an order is placed on the various mean combos. Place :- Place, as an element of the marketing mix, is not just about the physical location or distribution points for products. It encompasses the management of a range of processes involved in bringing products to the end consumer. McDonald’s outlets are very evenly spread throughout the cities making them very accessible. Drive in and drive through options make McDonald’s products further convenient to the consumers. People :-The employees in Mc Donalds have a standard uniform and Mc Donalds specially focuses on friendly and prompt service to its customers from their employees. Process :-The food manufacturing process at Mc Donalds is completely transparent i.e. the whole process is visible to the customers. In fact, the fast food joint allows its customers to view and judge the hygienic standards at Mc Donalds by allowing them to enter the area where the process takes place. The customers are invited to check the ingredients used in food.
Physical evidence :- McDonalds focuses on clean and hygienic interiors of is outlets and at the same time the interiors are attractive and the fast food joint maintains a proper decorum at its joints. We would be pleased if you can add your own points to the Marketing Mix of Mcdonalds. The article will be duly updated.
CHAPTER 3
MARKETING STRATEGY OF MCDONALDS
BUSINESS STRATEGY: 1 FRANCHISE MODLE – As per franchise modle of mcdonalds only 15% of total number of restaurant are owned by the company.The remaining 85% are owned by the franchises.The company follows all the framework of training and monitoring of its franchises to ensure that they acieve good QUALITY SERVICE,CLEANLINESS,ANND VALUE FOR THE MONEY.OFFERED BY THE COMPANY TO ITS CUSTOMERS 2 PRODUCT CONSISTENCY- By developing a sophisticated supplier for network and distribution system,the company has been able to achieve consistent product taste and food quality acroos nations of the world 3 ACT LIKE A RETAILER THINK LIKE A BRAND- Mcdonalds focuses not only on delivering sales for immediate present , but also focuses on protecting its long term brand reputation STRATEGY AS PER INDIAN MARKET: RE-ENGINERRING THE MENU –Mcdonald thinks according to tatse ,lifestlye,value system ,language etc of the customers.globally mcdonalds was famous for its hamburgers which was prepared from beef AND pork. So in order to satisfy demand of indian preference , mcdonalds came up with burgers of chicken, lamb and fish
INTRODUCTION
McDonald's fast food restaurant is one of the largest franchises in the United States as well as aboard. Their top menu items include: hamburgers, cheeseburgers, McNuggets, and French fries. They are also known for one of their popular desserts: the apple pie and their breakfast sandwich: the Egg McMuffin.
There are more than 32,000 McDonald's restaurants serving in 117 countries. More than 75% of McDonald's restaurants worldwide are owned and operated by independent owners.
McDonald's has several ethical and social responsibility policies in place throughout their solely owned and franchised companies. These policies include placing the customer experience at the core of what they do, committing to their employees by nurturing their talent and rewarding their achievements, maintaining high standards regarding the conduct for business, and giving back to the communities in which they are established. All of these values are infiltrated through all levels of the company, which keeps McDonald's thriving as a successful fast food chain restaurant.
Risk management is imperative to McDonald's. They have a risk assessment tool that they use to determine the country risk: which pertains to the specific country/region they are located in; industry risk: pertains to supplies produce; and facility risk: which is a combination of both country and risk groundwork. These factors are all part of the risk assessment tool that is used in each of their companies to help them with risk management. Security features in McDonald's includes their security camera systems within the facilities to continuously monitor all activity in and around the restaurants to ensure the safety for the workers as well as customers. McDonald's use these security cameras also in regards to workers compensation claims or liability lawsuit claims from consumers. McDonald's also monitors their computer software systems with an ACS system that monitors the technicogical factors of their business.
HISTORY
The McDonald's restaurant concept was introduced in San Bernardino, California by Dick and Mac McDonald of Manchester, New Hampshire. It was modified and expanded by their business partner, Ray Kroc, of Oak Park, Illinois, who later bought out the business interests of the McDonald brothers in the concept and went on to found McDonald's Corporation In 1937, Patrick McDonald opened "The Airdrome", an octagonal food stand, on Huntington Drive (Route 66) near the Monrovia Airport in Monrovia, California. Hamburgers were ten cents, and all-you-can-drink orange juice was five cents. In 1940, his two sons, Maurice and Richard ("Mac" and " Dick"), moved the entire building 40 miles (64 km) east, to West 14th and 1398 North E Streets in San Bernardino, California. The restaurant was renamed "McDonald's Famous Barbeque" and served over forty barbequed items. In October 1948, after the McDonald brothers realized that most of their profits came from selling hamburgers, they closed down their successful carhop drive-in to establish a streamlined system with a simple menu of just hamburgers, cheeseburgers, french fries, shakes, soft drinks, and apple pie. The carhops were eliminated to make McDonald's a self-serve operation. Mac and Dick McDonald had taken great care in setting up their kitchen like an assembly line to ensure maximum efficiency. The restaurant's name was again changed, this time to simply "McDonald's," and reopened its doors on December 12, 1948. In 1960, the McDonald's advertising campaign "Look for the Golden Arches" gave sales a big boost. Kroc believed that advertising was an investment that would in the end come back many times over, and advertising has always played a key role in the development of the McDonald's Corporation. Indeed, McDonald's ads have been some of the most identifiable over the years. In 1962, McDonald's introduced its now world-famous Golden Arches logo. A year later, the company sold its billionth hamburger and introduced Ronald McDonald, a red-haired clown with particular appeal to children. In the early 1960s, McDonald's really began to take off. The growth in U.S. automobile use that came with suburbanization contributed heavily to McDonald's success. In 1961 Kroc bought out
the McDonald brothers for $2.7 million, aiming at making McDonald's the number one fast-food chain in the country. In 1975, McDonald's opened its first drive-thru window in Sierra Vista, Arizona, following Wendy's lead. This service gave Americans a fast, convenient way to procure a quick meal. The company's goal was to provide service in 50 seconds or less. Drive-thru sales eventually accounted for more than half of McDonald's systemwide sales. Meantime, the Happy Meal, a combo meal for children featuring a toy, was added to the menu in 1979. As it was exploring new avenues of growth, however, McDonald's core hamburger chain had become plagued by problems. Most prominently, the Made for You system backfired. Although many franchisees believed that it succeeded in improving the quality of the food, it also increased service times and proved labor-intensive. Some franchisees also complained that the actual cost of implementing the system ran much higher than the corporation had estimated, a charge that McDonald's contested. In any case, there was no question that Made for You failed to reverse the chain's sluggish sales. Growth in sales at stores open more than a year (known as same-store sales) fell in both 2000 and 2001. Late in 2001 the company launched a restructuring involving the elimination of about 850 positions, 700 of which were in the United States, and some store closings. There were further black eyes as well. McDonald's was sued in 2001 after it was revealed that for flavoring purposes a small amount of beef extract was being added to the vegetable oil used to cook the french fries. The company had cooked its fries in beef tallow until 1990, when it began claiming in ads that it used 100 percent vegetable oil. McDonald's soon apologized for any "confusion" that had been caused by its use of the beef flavoring, and in mid-2002 it reached a settlement in the litigation, agreeing to donate $10 million to Hindu, vegetarian, and other affected groups. Also in 2001, further embarrassment came when 51 people were charged with conspiring to rig McDonald's game promotions over the course of several years. It was revealed that $24 million of winning McDonald's game tickets had been stolen as part of the scam. McDonald's was not implicated in the scheme, which centered on a worker at an outside company that had administered the promotions.
In July 2011, McDonald's announced that their largest restaurant in the world will be built on the 2012 London Olympics site. The restaurant will contain over 1,500 seats and is half the length of an American Football field. Over 470 staff will be employed serving on average (during the 2012 Olympics) 100,000 portions of fries, 50,000 Big Macs and 30,000 Milkshakes. This restaurant will overshadow the current largest McDonald's in the world in Moscow, Russia.
CHAPTER 2
Marketing Mix of Mcdonalds
The marketing mix of a company consists of the various elements as follows which form the core of a company’s marketing system and hence helps to achieve marketing objectives. The Service marketing mix in the case of McDonald’s is as below Product :- McDonald’s places considerable emphasis on developing a menu which customers want. Market research establishes exactly what this is. However, customers’ requirements change over time. In order to meet these changes, McDonald’s has introduced new products and phased out old ones, and will continue to do so. Care is taken not to adversely affect the sales of one choice by introducing a new choice, which will cannibalise sales from the existing one (trade off). McDonald’s knows that items on its menu will vary in popularity. Their ability to generate profits will vary at different points in their cycle. In India McDonalds has a diversified product range focussing more on the vegetarian products as most consumers in India are primarily vegetarian. The happy meal for the children is a great seller among others. Price :- The customer’s perception of value is an important determinant of the price charged. Customers draw their own mental picture of what a product is worth. A product is more than a physical item, it also has psychological connotations for the customer. The danger of using low price as a marketing tool is that the customer may feel that quality is being compromised. It is important when deciding on price to be fully aware of the brand and its integrity. In India McDonalds classifies its products into 2 categories namely the branded affordability (BA) and branded core value products (BCV). The BCV products mainly include the McVeggie and McChicken burgers that cost Rs 50-60 and the BA products include McAloo tikki and Chicken McGrill burgers which cost Rs20-3 This has been done to satisfy consumers which different price perceptions.
Promotion :- The promotions aspect of the marketing mix covers all types of marketing communications One of the methods employed is advertising, Advertising is conducted on TV, radio, in cinema, online, using poster sites and in the press for example in newspapers and magazines. Other promotional methods include sales promotions, point of sale display, merchandising, direct mail, loyalty schemes, door drops, etc. The skill in marketing communications is to develop a campaign which uses several of these methods in a way that provides the most effective results. For example, TV advertising makes people aware of a food item and press advertising provides more detail. This may be supported by in-store promotions to get people to try the product and a collectable promotional device to encourage them to keep on buying the item. At McDonalds the prime focus is on targeting children. In happy meals too which are targeted at children small toys are given along with the meal. Apart from this, various schemes for winning prices by way of lucky draws and also scratch cards are given when an order is placed on the various mean combos. Place :- Place, as an element of the marketing mix, is not just about the physical location or distribution points for products. It encompasses the management of a range of processes involved in bringing products to the end consumer. McDonald’s outlets are very evenly spread throughout the cities making them very accessible. Drive in and drive through options make McDonald’s products further convenient to the consumers. People :-The employees in Mc Donalds have a standard uniform and Mc Donalds specially focuses on friendly and prompt service to its customers from their employees. Process :-The food manufacturing process at Mc Donalds is completely transparent i.e. the whole process is visible to the customers. In fact, the fast food joint allows its customers to view and judge the hygienic standards at Mc Donalds by allowing them to enter the area where the process takes place. The customers are invited to check the ingredients used in food.
Physical evidence :- McDonalds focuses on clean and hygienic interiors of is outlets and at the same time the interiors are attractive and the fast food joint maintains a proper decorum at its joints. We would be pleased if you can add your own points to the Marketing Mix of Mcdonalds. The article will be duly updated.
CHAPTER 3
MARKETING STRATEGY OF MCDONALDS
BUSINESS STRATEGY: 1 FRANCHISE MODLE – As per franchise modle of mcdonalds only 15% of total number of restaurant are owned by the company.The remaining 85% are owned by the franchises.The company follows all the framework of training and monitoring of its franchises to ensure that they acieve good QUALITY SERVICE,CLEANLINESS,ANND VALUE FOR THE MONEY.OFFERED BY THE COMPANY TO ITS CUSTOMERS 2 PRODUCT CONSISTENCY- By developing a sophisticated supplier for network and distribution system,the company has been able to achieve consistent product taste and food quality acroos nations of the world 3 ACT LIKE A RETAILER THINK LIKE A BRAND- Mcdonalds focuses not only on delivering sales for immediate present , but also focuses on protecting its long term brand reputation STRATEGY AS PER INDIAN MARKET: RE-ENGINERRING THE MENU –Mcdonald thinks according to tatse ,lifestlye,value system ,language etc of the customers.globally mcdonalds was famous for its hamburgers which was prepared from beef AND pork. So in order to satisfy demand of indian preference , mcdonalds came up with burgers of chicken, lamb and fish
