Marketing Mix

For

Presented By:

• Abhishek Bhartiya

• B. Aditya Mohan

• Geetika Sodhi

• Mahek Nangia

• Mukul Kumar

• Wasim Shaikh

IntroductionIntroductionIntroductionIntroductionIntroductionIntroductionIntroductionIntroduction

• Total Revenue for 2006-07 was $740.2 million.

• Estimated CAGR of 40 percent.

•McDonald’s is the Eighth Most Poweful Brand in the

World. ----Source: Millward Brown Optimor (including data

from brandz, Datamonitor, and Bloomberg)

• Estimated CAGR of 40 percent.

• Rs 400 crore being put in for expansion plans into

Tier II cities within next three years.

• Doubling of turnover within three years.

•Market share of 18 percent in north India.(includes

restaurants, cafes, fast food joints, local vendors etc.)

Brief HistoryBrief HistoryBrief HistoryBrief HistoryBrief HistoryBrief HistoryBrief HistoryBrief History

• McDonald's was started as a drive-in restaurant by two

brothers, RichardRichard and MauriceMaurice McDonaldMcDonald in California,

US in the year 1937.

• By mid-1950s, the restaurant's revenues had reached

$350,000.

•• RayRay KrocKroc, distributor for milkshake machines, expressed•• RayRay KrocKroc, distributor for milkshake machines, expressed

interest in the business, and he finalized a deal for

franchising with the McDonald brothers in 1954.

• He established a franchising company, the McDonaldMcDonald

SystemSystem IncInc.. 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'sMcDonald's CorporationCorporation. In 1965, McDonald's went

public…

McDonald’s In IndiaMcDonald’s In IndiaMcDonald’s In IndiaMcDonald’s In IndiaMcDonald’s In IndiaMcDonald’s In IndiaMcDonald’s In IndiaMcDonald’s In India

• In 1996, first McDonald’s restaurantopened on Oct. 13, at Basant Lok,Vasant Vihar, New Delhi.

• McDonald's India is a 50 – 50 JV

partnership between McDonald’s

Corporation (U.S.A) and two Indian

businessman AmitAmit JatiaJatia (Hardcastle

Restaurants Private Limited, Mumbai)Restaurants Private Limited, Mumbai)

and VikramVikram BakshiBakshi (Connaught Plaza

Restaurants Private Limited, Delhi).

• Approximately 75% of the menu

available in McDonald’s in India is

Indianized and specifically designed to

woo Indian customers.

• The McDonald's philosophy of QSC&VQSC&V

is the guiding force behind its service to

the customers.

ProductProductProductProductProductProductProductProduct

“Our clear strategy is to bring the

customers in initially and provide a range

of entry-level products so that they can try

new items and graduate to the higher

rungs.” ---Vikram Bakshi,

Managing Director,

Northern Region, India

Product MixProduct MixProduct MixProduct MixProduct MixProduct MixProduct MixProduct Mix

Product Mix

Product Mix

Veg MenuVeg MenuNon-VegNon-Veg

BeveragesBeveragesFrozen Frozen

Veg MenuVeg MenuNon-Veg

MenuNon-Veg

MenuBeveragesBeverages

Frozen DesertsFrozen Deserts

•McVeggie™

•McAloo Tikki™

• Paneer Salsa Wrap

• Crispy Chinese

• Veg McCurry Pan™

• Pizza McPuff™

• Chicken Maharaja

Mac

•McChicken

• Fiet-O-Fish

• Chicken Mexican

Wrap

• Chicken McGrill

• Cold Coffee

• Ice Tea

• Soft Drinks

•Mc Shakes

• Hot Serves

• Soft Serve Cone

•Mc Swirl

• Soft Serve

• Flavor Burst

• Floats

VegVegVegVegVegVegVegVeg MenuMenuMenuMenuMenuMenuMenuMenu

NonNonNonNonNonNonNonNon--------VegVegVegVegVegVegVegVeg MenuMenuMenuMenuMenuMenuMenuMenu

BeveragesBeveragesBeveragesBeveragesBeveragesBeveragesBeveragesBeverages

Frozen DesertsFrozen DesertsFrozen DesertsFrozen DesertsFrozen DesertsFrozen DesertsFrozen DesertsFrozen Deserts

Co Co Co Co Co Co Co Co -------- BrandingBrandingBrandingBrandingBrandingBrandingBrandingBranding

McDonald’s has major tie-ups with various companies as their co-

branding Statergy.

Few of Them are listed Below:

Coca-Cola

Barbie

Hotwheels

Cadbury

PricingPricingPricingPricingPricingPricingPricingPricing

• Initial focus on metros – Mumbai and Delhi.

• Relatively high income.• Relatively high income.

•Move to smaller satellite towns.(Gurgaon and Pune)

• Jaipur and Agra – to attract foreign tourists.

Household ExpendituresHousehold ExpendituresHousehold ExpendituresHousehold ExpendituresHousehold ExpendituresHousehold ExpendituresHousehold ExpendituresHousehold Expenditures

Source: India, the structure of Poverty, WORLD RESOURCE INSTITUTE.

Purchasing power pricing:-

a) In 1997 slashed prices for vegetable nuggets and

soft serve cone.

Pricing StrategyPricing StrategyPricing StrategyPricing StrategyPricing StrategyPricing StrategyPricing StrategyPricing Strategy

soft serve cone.

b) In September 2001, they offered Veg surprise

burgers for Rs 17.

c) March 2004 – Aap ke zamane mein, baap ke

zamane ka daam.

Pricing StrategyPricing StrategyPricing StrategyPricing StrategyPricing StrategyPricing StrategyPricing StrategyPricing Strategy

Value Ladder strategy :-

a) Started offering value meals in a range of prices.

b) Ensure affordability and attract widest section of

customers.

c) Brought the customer and provided a range of entry-

level products.

d) Try those new items and graduate to higher-rungs.

e) E.g- if a customer starts with McAloo Tikki, he will

finally graduate to McVeggie and so in Non veg.

f) Helped its Volume business.

Aap ke zamane mein, Aap ke zamane mein, Aap ke zamane mein, Aap ke zamane mein, Aap ke zamane mein, Aap ke zamane mein, Aap ke zamane mein, Aap ke zamane mein,

baap ke zamane ka baap ke zamane ka baap ke zamane ka baap ke zamane ka baap ke zamane ka baap ke zamane ka baap ke zamane ka baap ke zamane ka daamdaamdaamdaamdaamdaamdaamdaam!!!!!!!!!!!!!!!!!!!!!!!!

Value Pricing.

a) Happy price menu – Rs 20.

b) Economeal – Rs 49(save Rs 11).

c) McChicken & McVeggie Meal – Rs 75,Rs 65 (Save Rs 15).

d) Happy Meal for Kids – Rs 69,99,109 (toy free).d) Happy Meal for Kids – Rs 69,99,109 (toy free).

e) Big saving Meals – Combos Rs 109 – Rs 119(Save Rs 36).

f) A-la carte menu – Rs 45- Rs 65 (Veg)

Rs 55- Rs 65 (Non Veg)

a) Desserts – Rs 12 – Rs 25.

b) Beverages – Rs 25- 50 ( a little costly)

Package deal.

• The most common strategy in fast food industry.

• The most preferred style for customers of McD.

Product BundlingProduct BundlingProduct BundlingProduct BundlingProduct BundlingProduct BundlingProduct BundlingProduct Bundling

• Plays on Psychological factor of the customer.

• Customer acquisition costs are high.

• Consumers appreciate the resulting simplification of

the purchase decision.

• The product mix offers are different in various parts of

India.

8080808080808080--------20 Menu Board20 Menu Board20 Menu Board20 Menu Board20 Menu Board20 Menu Board20 Menu Board20 Menu Board

• 80% visual.

• 20% descriptive.

• Easier for customers to understand what • Easier for customers to understand what

29,39,49,59,89,99 rupee options are.

•Pricing range, quick service, no-tips

environment attracted middle class and

students.

Food

items

McD SUBWAY KFC PIZZAHUT DOMINO’

S

Burgers &

Pizzas

Rs 20- Rs

70

Rs 65- Rs

135

Rs 25 –

Rs175

Rs 55- Rs

175

(regular)

Rs 35- Rs

140

(regular)

Combo

Meals

Rs 49-Rs

119

Rs 45- Rs

175

Rs 55-Rs

150

Rs 120- Rs

250

Rs 120- Rs

230

Competitive Pricing Competitive Pricing Competitive Pricing Competitive Pricing Competitive Pricing Competitive Pricing Competitive Pricing Competitive Pricing

Meals 119 175 150 250 230

Beverages Rs 25- Rs

50

Small-

300ml

Rs 35- Rs

45

Small-

300ml

Rs 30-Rs

55

Small-

300ml

Pet

beverage

MRP

(600 ml)

Rs 30

(600 ml)

Desserts Rs 12-Rs

25

Rs 20-Rs

50

Rs 15-Rs

65

Rs 40- Rs

60

Rs 25

(100ml

cup of

Baskin

Robbins)

Sustaining Sustaining Sustaining Sustaining Sustaining Sustaining Sustaining Sustaining –––––––– HOW?HOW?HOW?HOW?HOW?HOW?HOW?HOW?

Cost control strategy:-

a) Well established low –cost

supply chain.

b) Ensures efficiency and speed b) Ensures efficiency and speed

in distribution.

c) Huge increase in volume

sales.

d) Very good food processing

technology.

McDonald’s : A locally Owned McDonald’s : A locally Owned McDonald’s : A locally Owned McDonald’s : A locally Owned McDonald’s : A locally Owned McDonald’s : A locally Owned McDonald’s : A locally Owned McDonald’s : A locally Owned

CompanyCompanyCompanyCompanyCompanyCompanyCompanyCompany

McDonald’s

McDonald’s

Corporation

McDonald’s

India Pvt.

Ltd.

Hard Castle

Rest. Pvt. Ltd.

(West & South)

Connaught

Plaza Rest. Pvt.

Ltd.

(North & East)

Geographically Diverse suppliers: Ensuring stringent quality standards

McDonald’s : A locally Owned McDonald’s : A locally Owned McDonald’s : A locally Owned McDonald’s : A locally Owned McDonald’s : A locally Owned McDonald’s : A locally Owned McDonald’s : A locally Owned McDonald’s : A locally Owned

CompanyCompanyCompanyCompanyCompanyCompanyCompanyCompany

McDonald’s India: SuppliersMcDonald’s India: SuppliersMcDonald’s India: SuppliersMcDonald’s India: SuppliersMcDonald’s India: SuppliersMcDonald’s India: SuppliersMcDonald’s India: SuppliersMcDonald’s India: Suppliers

• Trikaya AgricultureSupplier of Iceberg Lettuce

• Vista Processed Foods Pvt. Ltd.Supplier of Chicken and Vegetable range of

products.

• Dynamix DiarySupplier of Cheese.

• Amrit FoodSupplier of long life UHT Milk and Milk

Products for Frozen Desserts.

McDonald’s India: SuppliersMcDonald’s India: SuppliersMcDonald’s India: SuppliersMcDonald’s India: SuppliersMcDonald’s India: SuppliersMcDonald’s India: SuppliersMcDonald’s India: SuppliersMcDonald’s India: Suppliers

SELECTION

MODIFICATION

MOTIVATION

EVALUATION

McDonald’s India: DistributionMcDonald’s India: DistributionMcDonald’s India: DistributionMcDonald’s India: DistributionMcDonald’s India: DistributionMcDonald’s India: DistributionMcDonald’s India: DistributionMcDonald’s India: Distribution

Radhakrishna Foodland

Distribution Centres and cold storages.

“With a cold chain in place there is practically no need for a knife in

the restaurant. Chopping and food processing is done in plants.

Restaurants are confined only to actual cooking” – Amit Jatia.

•Completely dedicated distribution and supply chain.

•Matching supplier production with deliveries using ERP.

• Quality inspection Program, quality check at 20 different points in

supply chain.

• HACCP(Hazard analysis critical control points) food safety

standards emphasizing prevention of faults.

McDonald’s India: Channel McDonald’s India: Channel McDonald’s India: Channel McDonald’s India: Channel McDonald’s India: Channel McDonald’s India: Channel McDonald’s India: Channel McDonald’s India: Channel

NetworkNetworkNetworkNetworkNetworkNetworkNetworkNetwork

North and East India (79)

33 in Delhi

22 in Uttar Pradesh

11 in Haryana

7 in Punjab

3 in Rajasthan

1 in Uttaranchal

1 in West Bengal

1 in Himachal Pradesh1 in Himachal Pradesh

West and South India (53)

32 in Maharashtra

7 in Gujarat

7 in Karnataka

4 in Andhra

3 in Madhya Pradesh

McDonald’s India: Network & McDonald’s India: Network & McDonald’s India: Network & McDonald’s India: Network & McDonald’s India: Network & McDonald’s India: Network & McDonald’s India: Network & McDonald’s India: Network &

competitorscompetitorscompetitorscompetitorscompetitorscompetitorscompetitorscompetitors

COMPANIES

McDonald’s

Pizza Hut

OUTLETS (No.)

132

137

CITIES COVERED

34

34

Domino’s

Subway

Nirula’s

KFC

220

131

65

34

42

32

NCR

09

McDonald’s India: Outlets McDonald’s India: Outlets McDonald’s India: Outlets McDonald’s India: Outlets McDonald’s India: Outlets McDonald’s India: Outlets McDonald’s India: Outlets McDonald’s India: Outlets

Standardization is the key!!

McDonald’s India: The Road McDonald’s India: The Road McDonald’s India: The Road McDonald’s India: The Road McDonald’s India: The Road McDonald’s India: The Road McDonald’s India: The Road McDonald’s India: The Road

Ahead… Ahead… Ahead… Ahead… Ahead… Ahead… Ahead… Ahead…

• Increasing seating capacity.

• Aggressive expansion plans throughout the country.

•More drive thru’s.

• Oil alliance with BPCL in 2002, with HPCL in Jan, 2008.

• Independent franchisee model.

•McDelivery on cycles.

• Entry in new cities.

PromotionPromotionPromotionPromotionPromotionPromotionPromotionPromotion

•An activity, such as a sale or advertising

campaign, designed to increase visibility

or sales of a product.

•McDonalds, for years has maintained an

extensive promotion strategy with

highest spending on marketing amongst

all its competitors.

Advertising Advertising Advertising Advertising Advertising Advertising Advertising Advertising

• Focus on overall

experience.

• “Brand globally and act

locally”.

Overall it is doing what it•Overall it is doing what it

does the best – marketing.

• Intensive advertising aimed

at children.

•Paper mats on trays ensure

that no new scheme goes

unnoticed.

• 80-20 menu boards marketing

tool.

• Sponsors sport events with

their logos advertised in these

events.

Advertising Advertising Advertising Advertising Advertising Advertising Advertising Advertising

events.

• Significant use of billboards

and signage.

• Image of portraying warmth

and a real slice of everyday

life has become a trademark

and has created many

memorable commercials.

THE mascot…THE mascot…THE mascot…THE mascot…THE mascot…THE mascot…THE mascot…THE mascot…

• The well known mascotRonald McDonald is thesame throughout theworld since 1963.

• It is supposed to be thenext most well recognizednext most well recognizedfigure second only toSanta Claus.

• The color combinationmaximizes brandexposure and is supposedto increase hunger

Campaigns…Campaigns…Campaigns…Campaigns…Campaigns…Campaigns…Campaigns…Campaigns…

• “I’m lovin’ it” is an international branding campaign which was launched in 2003 and has proved to be its biggest success.proved to be its biggest success.

• “aap ke zamaane meinbaap ke zamaane ke daam” is a highly localized campaign which aimed at attracting the masses through its happy price menu.

Issues with McDonald’sIssues with McDonald’sIssues with McDonald’sIssues with McDonald’sIssues with McDonald’sIssues with McDonald’sIssues with McDonald’sIssues with McDonald’s

• Nutritionists argue that the type of high fat, low fibre

diet promoted by McDonald's is linked to serious

diseases such as cancer, heart disease, obesity and

diabetes.

•Many parents object strongly to the influence this has•Many parents object strongly to the influence this has

over their own children.

• Complaints from employees range from discrimination

and lack of rights, to understaffing, few breaks and

illegal hours, to poor safety conditions and kitchens

flooded with sewage, and the sale of food that has

been dropped on the floor.

•They use their financial clout to influencethe media, and legal powers to intimidatepeople into not speaking out, directlythreatening free speech.

•Conservationists have often focussed on

Issues with McDonald’sIssues with McDonald’sIssues with McDonald’sIssues with McDonald’sIssues with McDonald’sIssues with McDonald’sIssues with McDonald’sIssues with McDonald’s

•Conservationists have often focussed onMcDonald's as an industry leaderpromoting business practices detrimentalto the environment. And yet the companyspends a fortune promoting itself asenvironmentally friendly.

PeoplePeoplePeoplePeoplePeoplePeoplePeoplePeople

• Each outlet is headed by a

Restaurant Manager . He is

responsible for the daily

operation and customer

interaction.

• Delivery Crew Member • Delivery Crew Member

carries basic operation of a

restaurant. Ensures customer

satisfaction at the

restaurants.

• In order to motivate there

employees they give them

stars as per their

performance.

Training At HamburgerTraining At HamburgerTraining At HamburgerTraining At HamburgerTraining At HamburgerTraining At HamburgerTraining At HamburgerTraining At Hamburger

Hamburger University – McDonald’s Centre of Training Excellence

• Since its inception, training at Hamburger University has

emphasized consistent restaurant operations procedures, service,

quality and cleanliness. It has become the company’s global centre

of excellence for McDonald’s operations training and leadershipof excellence for McDonald’s operations training and leadership

development

• February 24, 1961, Hamburger Universities first class of 14

students graduated

• Today, more than 5,000 students attend HAMBURGER UNIVERSITY

each year

• Since 1961, more than 80,000 restaurant managers, mid-

managers and owner/operators have graduated from this facility

Organizational ChartOrganizational ChartOrganizational ChartOrganizational ChartOrganizational ChartOrganizational ChartOrganizational ChartOrganizational Chart

Physical evidence..Physical evidence..Physical evidence..Physical evidence..Physical evidence..Physical evidence..Physical evidence..Physical evidence..

•Cleanliness, speed, quality and transparency

of process is the biggest physical evidence.

• The interiors are attractive and more or less

consistent throughout the world.consistent throughout the world.

•A proper decorum and strict standards of

cleanliness are maintained at all the joints.

• Extra care is given to make the joints children

friendly

•Family environment message throughout the world, just the way of communication is adjusted to different countries.

•Play areas are provided so that kids don’t

Physical evidence..Physical evidence..Physical evidence..Physical evidence..Physical evidence..Physical evidence..Physical evidence..Physical evidence..

•Play areas are provided so that kids don’t become panicky.

•Counters are kept low and menus pictorially displayed so that children can order for themselves.

Process Process Process Process Process Process Process Process

Ready to

cook frozen

food material

Delivery to

Initiator

Assembler

Universal

holding

Cabinet

Delivery to

customer

Thank YouThank You