A PROJECT REPORT

On
A STUDY OF CONSUMER SATISFACTION RETENTION
IN MCDONALD
Submitted towards Partial Fulfillment of
BACHELOR OF BUSINESS ADMINISTRATION
(AFFILIATED TO C.C.S. UNIVERSITY, MEERUT)
(2012-2015)
SUBMITTED BY:
SHIVANI SHARMA
ROLL NO:-9866613
BBA VI SEM
UNDER THE GUIDANCE OF

External Supervisor:

Internal supervisor:

Mr. ANOOP MISHRA

MANAGER

Mr. SUDHEER KUMAR

Faculty, Management
DIMS, Meerut

DEWAN INSTITUTE OF MANAGEMENT

STUDIES, MEERUT

STUDENT DECLARATION
I Shivani Sharma, students of BBA final Year. from DIMS, Meerut hereby
declares that the research report entitled A Study of Consumer Satisfaction
Retention in MacDonald. is completed and submitted under the valuable
guidance of Mr. Sudheer Kumar, Faculty of Management , DIMS,
Meerut faculty of management, it my original work.

This imperial in this research is based on the data collected by us.

This research report has not been submitted to CCS, University Meerut or
any other university for the purpose of compliance of any requirement of any
examination or degree.

Date.

SHIVANI SHARMA
ROLL NO:-9866613
BBA VI SEM

PREFACE

This report reviews the A Study of

Consumer Satisfaction Retention in

MacDonald . I gave a brief history of the company history, Achievements, and

growths of the company. It puts a light on the whole Organizations activities
Advertising, sales promotion, etc. I also reviewed the SWOT

Analysis,

comaparrsion with other similar brands. in the end I gave the future plans, and
concluded with suggestions ,recommendation ,limitations of McDonald

ACKNOWLEDGEMENT
Apart from the efforts of me, the success of any project

depends largely on

the encouragement and guidelines of many others. I take this opportunity to

express my gratitude to the people who have been instrumental in the
successful completion of this project. I would like to show my greatest
appreciation to my guide Mr. Sudheer Kumar, Faculty of Management ,
DIMS, Meerut. I cant say thank you enough for his tremendous support and
help. Without his encouragement and guidance this project would not have
materialized.

The guidance and support received from all the members who contributed
and who are contributing to this project, was vital for the success of the
project. I am grateful for their constant support and help.

SHIVANI SHARMA

TABLE OF CONTENT
TITLE PAGE

STUDENTDECLARATION

PREFACE

ACKNOWLEDGEMENT
EXECUTIVE SUMMARY
INTRODUCTION
OBJECTIVE OF STUDY

4
6-8
9
10

Product
Needs wants and demands
MCDonald Lunch New Menu & Ad Campiness
Marketing mix of MCDonald
MCDonald franchising network in india
Names awarded to MCDonald
Slogans
Future plans
Corporate social responsibilities of MCDonald
Customer satisfaction in 7 steps
Comparison between dominos and MCDonald
MCDonald Sales

LITRATURE REVIEW
RESEARCH METHODOLOGY
SWOT
DATA ANALYSIS
RECOMMENDATIONS AND SUGGESTION
CONCLUSION
LIMITATION
BIBLIOGAPHY
QUESTIONNAIRE

11-20
21-38
39
40-46
47-52
53-63
64-70
71
72
73-75
76-77
78
79
80-81
82-83
84-96
97-98
99
100
101
102-103

EXECUTIVE SUMMARY
The research report includes our research about MCDonald to analyze the most important
element for its profitability. In this research we conducted a customer analysis in which
we asked the customers their preferences for going to any fast food restaurant. We also
5

asked them about their experiences in MCDonald, every time they visit there. This helped
us making a broad perception about the future sales and profitability of MCDonald and
what MCDonald needs to do to maintain its image and retain the customers.
Pizza emerged sometime in the middle Ages. It was used to describe both the sweet
and saltypies that were becoming popular among Italian aristocracy. Pizza is basically a
mealprepared in a plate made of bread. There are four main components of a basic
pizza pie.They are crust, sauce, cheese and toppings.

Two brothers, mom and $600 turned into the recipe for the world's largest pizza
companyin 1958, when a family friend with the idea of opening a pizza parlor
approached the twocollege-age brothers in Kansas. The result of their efforts was the
first MCDonald and the foundation for what would become the largest and most
successful pizza restaurant in theworld.

There are different objectives of every organization. In order to achieve these objectives
different targets are set. Targets pass down the hierarchy depending on the nature of the
business. Therefore, in order to achieve the objectives, management decides ondifferent
strategies. These strategies are divided into many sub-parts and are useful for
the running of the business. The employees and the management know what they have
to achievethrough the targets which have been set to them and the strategies they have
adoptedhelp them know the way they will achieve the objectives. Similarly, MCDonald
has differenttargets set to them and they have adopted different strategies to

successfully achieve thetargets set. These targets are set by the RSC i.e. the restaurant
support centre in india.
These targets are passed on to the RGM (restaurant general manager) and he passes
them to the workforce. These targets fall within the organizational structure in which
there are many people who have different targets to achieve. In order to successfully
achieve the targets they need to co-operate and work in a friendly environment.
During the past four decades MCDonald has built a reputation for excellence that has
earned the respect of consumers and industry experts alike. Building a leading pizza
company has required relentless innovation, commitment to quality and dedication to
customer service and value. The qualities of entrepreneurship, growth and leadership
have characterized MCDonalds business through more than four decades of success.
Through the strength of its heritage, its culture and its people and franchisees, MCDonald
looks forward to more success in future.

MC DONALD'S
McDonald's Corporation (NYSE: MCD) is the world's largest chain of hamburger fast food
restaurants, serving more than 58 million customers daily In addition to its signature restaurant
chain, McDonalds Corporation held a minority interest in Pret A Manger until 2008, was a
major investor in the Chipotle Mexican Grill until 2006 and owned the restaurant chain Boston
Market until 2007
A McDonald's restaurant is operated by a franchisee, an affiliate, or the corporation itself. The
corporation's revenues come from the rent, royalties and fees paid by the franchisees, as well as
sales in company-operated restaurants. McDonald's revenues grew 27% over the three years
ending in 2007 to $22.8 billion, and 9% growth in operating income to $3.9 billion
McDonald's primarily sells hamburgers, cheeseburgers, chicken products, French fries, breakfast
items, soft drinks, shakes, and desserts. In response to obesity trends in Western nations and in
the face of criticism over the healthiness of its products, the company has modified its menu to
include alternatives considered healthier such as salads, wraps and fruit.

CORPORATE OVERVIEW
Facts and figures

McDonald's boasts its service to "99 billion customers".

McDonald's restaurants are found in 119 countries and territories
around the world and serve 58 million customers each day.
McDonald's operates over 31,000 restaurants worldwide,
employing more than 1.5 million people.] The company also
operates other restaurant brands, such as Piles Caf.

Focusing on its core brand, McDonald's began divesting itself of other chains it had acquired
during the 1990s. The company owned a majority stake in Chipotle Mexican Grill until October
2006, when McDonald's fully divested from Chipotle through a stock exchange. Until December
2003, it also owned Donatos Pizza. On August 27, 2007, McDonald's sold Boston Market to Sun
Capital Partners.

Type

of

Most standalone McDonald's restaurants offer both counter

service and drive-through service, with indoor and sometimes

restaurants

outdoor seating.

Drive-Thru, Auto-Mac, Pay and Drive, or "McDrive" as it is

known in many countries, often has separate stations for placing,
paying for, and picking up orders, though the latter two steps are
frequently combined.

In some countries, "McDrive" locations near highways offer no

counter service or seating. In contrast, locations in high-density
city neighborhoods often omit drive-through service. There are
also a few locations, located mostly in downtown districts that
offer Walk-Thru service in place of Drive-Thru.

Specially themed restaurants also exist, such as the "Solid Gold

McDonald's," a 1950s rock-and-rollthemed restaurant In
Victoria, British Columbia, there is also a McDonald's with a 24carat (100%) gold chandelier and similar light fixtures.

To accommodate the current trend for high quality coffee and the
popularity of coffee shops in general, McDonald's introduced
McCaf, a caf-style accompaniment to McDonald's restaurants
in the style of Starbucks.

Products

A McDonald's Big Mac combo meal served with French fries and
Coca-Cola.

McDonald's predominantly sells hamburgers, various types of chicken

sandwiches and products, French fries, soft drinks, breakfast items, and
desserts.

McDonald's offers salads and vegetarian items, wraps and other

localized fare.

Portugal is the only country with McDonald's restaurants serving soup.

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

HEADQUARTERS
The McDonald's headquarters complex, McDonald's Plaza, is located in Oak Brook, Illinois. It
sits on the site of the former headquarters and stabling area of Paul Butler, the founder of Oak
Brook McDonald's moved into the Oak Brook facility from an office within the Chicago Loop in
1971.

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 ranging from Little League to the Olympic Games, and

10

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 advertisingas well as a few
other slogans for select countries and regions. At times, it has run into trouble with its
campaigns.

CHILDREN'S ADVERTISING
Sports awards and honors
Global operations

Countries with McDonald's stores

McDonald's has become emblematic of globalization, sometimes referred to as the
"McDonaldization" of society. The Economist newspaper 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. Scandinavian countries lead the Big Mac Index with four of
the five most expensive Big Mac's. Norway has the most expensive Big Mac in the world as of
July 2008, whiles the country with the least expensive Big Mac is Malaysia.

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12

EARLY HISTORY

The oldest operating McDonald's on Lakewood and Florence in Downey, California, was the
chain's third restaurant and the second to be built with the Golden Arches.
In 1937, Patrick J. 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
Bar-B-Q" and served twenty five barbecued items on their menu.

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 aself-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.

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In 1953, the McDonald brothers began to franchise their successful restaurant, starting in Phoenix,
Arizona and Downey, California; the latter is today the oldest surviving McDonald's restaurant. The McDonald
brothers created Speedee to symbolize the quick and efficient service system that they had devised. They later
withdrew Speedee because the Alka-Seltzer mascot was named Speedy, and McDonald's did not want to be affiliated
with Alka-Seltzer. Downey's Speedee is one of only a few remaining. His little legs, animated in neon, still run as fast
as they can to serve the restaurant's next customer. The Speedee sign was erected in 1959 at Downey with its single
giant arch and is a one-of-a-kind. It also hearkens back to the days of the postwar era when the roadside was filled
with larger than life advertisements of all shapes and colors vying for motorists' attention: "Hey pull in over here, This
is Your Kind of Place!" Designed by the architect Stanley Clarke Meston and his assistant Charles Fish, Downey's
restaurant is the oldest operating McDonald's in the world. Since it was franchised not by the McDonald's
Corporation, but by the McDonald brothers themselves to Roger Williams and Burdette Landon, the Speedee
McDonald's was not required to comply with the McDonald's Corporation's remodeling and updating requests over
the years.

Recognizing the historic and nostalgic value of the intact 1953 structure, the McDonald's Corporation acquired the
store in 1990 and rehabilitated it to a modern but nearly original condition, and then built an adjacent museum and
gift shop to commemorate the site. Inside the small museum are many McDonald's artifacts from over the years, and
also a small display showing how the restaurant buildings evolved from the small walk-up candy striped stands to the
large more common mansard-roofed restaurants.

In 1954, Ray Kroc, a seller of Multi-mixer milkshake machines, learned that the McDonald brothers were using eight
of his machines in their San Bernardino restaurant. His curiosity was piqued, and he went to San Bernardino to take a
look at the McDonalds' restaurant.

14

Believing that the McDonalds' formula was a ticket to success, Kroc suggested that they franchise their restaurants
throughout the country. When they hesitated to take on this additional burden, Kroc volunteered to do it for them. He
returned to his home outside of Chicago with rights to set up McDonald's restaurants throughout the country, except
in a handful of territories in California and Arizonaalready licensed by the McDonald brothers. Kroc's first McDonald's
restaurant opened in Des Plaines, Illinois, near Chicago, on April 15, 1955, the same day that Kroc incorporated his
company as McDonald's Systems, Inc. (which he would later rename McDonald's Corporation). Ray Kroc's first
McDonald's was then demolished after many remodels in 1984.

Once the Des Plaines restaurant was operational, Kroc sought franchisees for his McDonald's chain. The first snag
came quickly. In 1956 he discovered that the McDonald brothers had licensed the franchise rights for Cook County,
Illinois to the Frejlack Ice Cream Company. Kroc was incensed that the McDonalds had not informed him of this
arrangement. He purchased the rights back for $25,000, five times what the Frejlacks had originally paid, and
pressed forward. McDonald's grew slowly for its first three years. By 1958, there were 34 restaurants. In 1959,
however, Kroc opened 68 new restaurants, bringing the total to 102 locations.

[edit]Phenomenal growth in the 1960s and 1970s

The Big Mac hamburger made its debut in 1968

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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 designed to
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 1965, McDonald's Corporation went public. Common shares were offered at $22.50 per share. By the end of the
first day's trading, the price had shot up to $30. A block of 100 shares purchased for $2,250 in 1965 was worth, after
12 stock splits (increasing the number of shares to 74,360), over $5.7 million as of year-end market close on
December 31, 2010. In 1985, McDonald's Corporation became one of the 30 companies that make up the

NEEDS, WANTS AND DEMANDS :

Need:
To eat something good its customer need and McDonald fulfill their need according to their
expectations and fulfill the desire of hunger.
Wants:
Mainly pizza of McDonald is not the basic need of people but it is a want of those who want
some extra or they want to celebrate some specific occasion, and they celebrate these with
McDonald.

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Demand:
McDonald also give considerable and proper attention to demands of people. In new product
development, McDonald considers demands of people specially. There are several steps to go
through before they launch a new product.
The first step is to carry out research to find out:

What people think about pizzas (what role do they play in people's lives, when do they eat
them and so on)?

What do they like about pizzas?

What do they dislike about pizzas?

What do they want from pizzas?

Marketing offer:
McDonald creates a market offer very much according to market. It is offered to satisfy need or
want. The information is collected together and used to create ideas for prototypes. The ideas are
tested first, before they make any pizzas.
Customer value & satisfaction:
McDonald create certain expectations among its customers, is fulfilling it accurately, and get a
good image in minds of customers. Its customers are satisfied by its quality as it satisfies their
expectations. They give basic priority to their customers.

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Exchange & relationships:

McDonald has maintained very good relationships with its customers. It believes on exchange
through relationships. They create relationships by offering the best product and best services to
their customers for example they are offering to their customers home delivery services &
providing products according to customers requirement.
Market:
McDonald is entering in global as well as local market. Being that McDonald holds the most
market in the pizza industry all around the world, they perceived quality and service of the
company will help to ensure a better than average chance at a successful introduction of anew
product. The pizza industry firms are famous for introducing new products to spark short-term
sales in available marketplaces. McDonald as stated earlier has been very successful at
accomplishing this in different markets. The introduction of a product that keeps with today's
trends is also important to reduce the risk of failure. In recent years, there has been an increase in
the marketing of products with an extreme twist to them. Mountain Dew, which is a brand name
owned by McDonalds parent company, PepsiCo, has been very successful at repositioning itself
to this segment of the market, which has parked new interest in the soft drink. Many other
imitators have followed their example and have been successful as well. McDonald has the
resources available to research and implement a new product with great success in globally
marketplace.

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1. CUSTOMER DRIVEN MARKETING STRATEGY:

McDonalds marketing strategy is very simple: we want to satisfy our customer boffering them
the best. Their main segment which they have captured is combination of higher incomes &
dual career families. Their maximum market segment is younger generation ranges from 12-30.
Another big strength and even a competitive advantage is the fact that they have a full service
restaurant as well as delivery services. Most of McDonald's competitors do not have restaurants.
Because of the restaurant, McDonald can market to different segments that other pizza chains
cannot. For example, McDonald can market to families much easier than Domino's or Little
Caesar's. McDonald offers a sit-down, conversational type restaurant where families can take
their children for birthday parties. McDonald's broad selection of products also makes it easier
for them to market to different market segments.
The other two strategies followed by McDonald are C.H.A.M.P.S (Cleanliness, Hospitality,
Accuracy, Maintenance, Product quality and Speed) and 3Fs (Fun, Friendly & Familiar).

These two strategies have really helped McDonald to evolve out as a market leader with a
competitive advantage

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2. MARKETING PLAN THAT DELIVERS SUPER IOR VALUE

Marketing plan is the set of controllable tactical marketing tools that the McDonald blends to
produce the product. McDonald develop best product with the resources available.

Marketing plans made to gain a competitive advantage over its rivals in a market.
Hence, all the businesses need to adopt business level strategies in order to compete in a
competitive environment. If we look at the India market, there are no large competitors of
McDonald but unlimited small competitors exist in the market. The threat of competitors is very
low as there is no international food chain offering pizza in Pakistan at present. Therefore,
present strategies adopted by McDonald are keeping in consideration the present competition.
Whereas, in future this competition will increase and McDonald will have to change all its
business level strategies in order to compete with its rivals. In very near future Dominos is
opening its first branch in Delhi. This would be a threat for McDonaldand hence, the strategies
would be changed. Response it wants in the target market.
It consists of everything it can do, to influence the demand for its they follow the marketing plan
to fulfill their goals and target. So the marketing plan comprises on 4Ps;

PRODUCT

PRICE

PLACE

PROMOTION

Products of McDonald are goods and services, that they offer to target market to satisfy the needs
and wants of customer. Their products are based on variety, quality, design, features, brand name

20

and services. Price is s et by McDonald, when product is launched in market. They negotiate the
price with each customer-offering discount. They adopt, pricing strategy to hold maximum share
of market by maximizing profit. Place is set of activities that make the product available to target
customer. McDonald refers to the best place to offer program. Their outlets are located in almost
100 countries including India. Promotion is used to communicate the feature and benefit of
product. McDonald promotes its product through advertising, sales promotion, personal selling
and public relations.
3. BUILD RELATIONSHIP &CUSTOMER SATISFACTION
They build strong relationship with customer by offering them best pizza. They create customer
delight through;
Customer Relationship Management (CRM)
Partner Relationship Management (PRM)

Customer relationship management (CRM):

McDonald build and maintain profitable customer relationships by delivering superior customer
value and satisfaction. In 1995, McDonald began two customer satisfaction programs:a. 1-800
number customer hotlines and a customer callback program. These were implemented to make
sure their customers were happy, and always wanted to return. They have full service restaurant
as well as delivery services.

Partner Relationship Management (PRM)

McDonald is working closely with partners in inside departments and outside the business
unit to jointly bring greater value to customers. Theyve inside & outside partners e.g.
customers, competitors, suppliers, functional department etc. Functional department

21

corporate & focus on an area such as marketing, HR. In 1977 Pepsi co bought McDonald
&1982 they stared joint venture with Whitbread. In 2006 Whitbread sold their share of
joint venture to YUM! Brands Inc. McDonald UK Ltd was now 100% owned by Yum!

4 CAPTURE VALUE IN RETURN

McDonald is committed to providing uncompromising product quality offering customers
the highest value for money & giving service that is warm, friendly & personal. They also
follow social factors to maintain their image through corporate social responsibility. All the
employees back-of-the-house i.e. the kitchen assistants are trained accordingly. They are
given extra classes in order to meet the quality standards set by McDonald around the
world. Different quality management staff is also there at McDonald. The shift managers
have the task to observe whether the quality standards are met or not, whereas there are a
total quality management department at the main office.

This department has the task to implement quality standards, by this way they create value
in minds of customers providing best of best in market.

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Advertising

McDonald's Pan Pizza.

McDonald ad
McDonald's very first ad was "Putt Putt to McDonald". It starts with a man apparently ordering
take-out and driving his 1965 Mustang JR to McDonald, while some of the townspeople start
chasing him. He picks up his pizza and goes to his house, when all of the people who were
chasing him start eating all the pizza except the man who ordered it.

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Frustrated, he calls McDonald again.

Until early 2007, McDonald's main advertising slogan was "Gather 'round the good stuff", and is
currently "Now You're Eating!". McDonald does not have an official international mascot, but at
one time, there were commercials in the United States called 'The Pizza Head Show.' These
commercials ran from 1993 to 1997 and were based loosely on the Mr. Bill shorts from Saturday
Night Live in the 1970s. The ads featured a slice of pizza with a face made out of toppings called
'Pizza Head'. In the 1970s McDonald used the signature red roof with a jolly man named
"McDonald Pete". Pete was on the bags, cups, balloons and hand puppets for the kids. In
Australia during the Mid to late 1990s, the advertising mascot was a delivery boy named Dougie,
with boyish good looks who, upon delivering pizza to his father, would hear the catchphrase
"Here's a tip: be good to your mother".
McDonald sponsored the 1989 film Back to the Future Part II, and offered a free pair of
futuristic sunglasses, known as "Solar Shades", with the purchase of McDonald pizza. McDonald
also engaged in product placement within the film itself, having a futuristic version of their logo
with their trademarked red hut printed on the side of a miler dehydrated pizza wrapper in the
McFly family dinner scene, and appear on a storefront in Hill Valley in the year 2015.
The 1990 NES game Teenage Mutant Ninja Turtles II: The Arcade Game, came with a coupon
for a free pizza. The game was filled with McDonald advertising and pizza that would refill the
character's life.
In 1994, Donald Trump and ex-wife Ivana Trump starred in a commercial. The ending of the
commercial showed Ivana Trump asking for the last slice, to which Donald replied, "Actually

24

dear, you're only entitled to half", a play on the couple's recent divorce. In 1995, Ringo Starr
starred in a McDonald commercial which also featured The Monkees. Rush Limbaugh also
starred in a McDonald commercial the same year, where he boasts that "nobody is more right
than me," yet he states that for the first time he will do something wrong, which was to
participate in McDonald's then "eating pizza crust first" campaign regarding their stuffed crust
pizzas.
Talk show host Jonathan Ross, co-starred in an ad with American model, Caprice Bourret. They
were used to advertise the stuffed crust pizza, with Jonathan Ross saying "Stuffed Cwust", to
which is a play on Jonathan's pronunciation of 'R's. Another UK ad shows British Formula One
driver Damon Hill visit a McDonald restaurant and order a pizza, with famous F1 commentator
Murray Walker visiting with him, and narrating as though it was a Formula One race. As Hill is
about to finish his meal, Walker, in a play on Hill's 1994 & 1995 seasons where he was runner up
in the formula One World Championship both won by Michael Schumacher, shouts "And Hill
finishes second, again!" at which Hill grabs Walker by his shirt and shakes him angrily, Walker
proclaiming, in his usual tones, "He's lost it! He's out of control!"
Following England's defeat to Germany on penalties in the semi-finals of Euro 96, Gareth
Southgate, Stuart Pearce and Chris Waddle featured in an advert. The advert shows Southgate
wearing a paper bag over his head in shame as he was the one, who missed the crucial penalty
against the Germans. Waddle and Pearce, who both missed penalty kicks in Italia 90 are
ridiculing him, emphasising the word 'miss' at every opportunity. After Southgate finishes his
pizza he takes off his paper bag, heads for the door and bangs his head against the wall. Pearce
responds with, "this time he's hit the post".

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In 1997, former Soviet Union Premier Mikhail Gorbachev starred in a McDonald commercial to
raise money for the Perestroyka Archives. In recent years, McDonald has had various celebrity
spokespeople, including Jessica Simpson, the Muppets, and Damon Hill and Murray Walker.
Recent commercials have Queen Latifah providing the voiceover. Also in 1997, McDonald,
reunited "greatest of all time boxer" Muhammad Ali with trainer Angelo Dundee in a sentimental
made for Super Bowl commercial.
McDonald sponsored the first space pizza delivery in 2001, and paid for their logo to appear on a
Russian Proton rocket in 2000.[19]
In Australia, 2006 saw the introduction of a mascot in McDonald's advertising "Pizza Mutt", a
small dog who delivers pizzas. The mascot was dumped after just two ads.
Early 2007 saw McDonald move into several more interactive ways of marketing to the
consumer. Utilizing mobile phone SMS technology and their MyHut ordering site, they aired
several television commercials (commencing just before the Super Bowl) containing hidden
words that viewers could type into their phones to receive coupons.
Other innovative efforts included their "MySpace Ted" campaign, which took advantage of the
popularity of social networking, and the burgeoning user-submission marketing movement via
their Vice President of Pizza contest.
As of October 2009, McDonald is now advertising its WingStreet brand on a nationwide basis,
having met its internal requirement of 80% of stores having the product available (both corporate
and franchised).

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Pasta Hut
Pasta Hut logo (2008present)
On April 1, 2008, McDonald in America sent emails to customers advertising that they now offer
pasta items on their menu. The email (and similar advertising on the company's website) stated
"Pasta so good we've changed our name to 'Pasta Hut'." The name change was a publicity stunt
held in conjunction with April Fools' Day, extending through the month of April, with the
company's Dallas headquarters changing its exterior logo to Pasta Hut.[20] This name change was
also used to promote the new Tuscani Pasta line and new McDonald dine-in menu. The first
Pasta Hut advertisement has the original McDonald restaurant being imploded and recreated, but
when they construct the new building, the sign saying "Pasta Hut" is placed on the building.
Australia
On January 19, 2009, McDonald started a six-week online vote in Australia as to whether
McDonald should become Pasta Hut. They are also co-branding two stores with the Pasta Hut
logo. Advertising for the new brand involved the production team creating a set of a restaurant
called "Toscani's". As the TV suggests, the diners in the fictional restaurant, complete with
signage and secret recording equipment; the customers were unaware they were eating pasta
from McDonald.[21]

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United Kingdom
In the United Kingdom on January 19, 2009, McDonald had announced that the Pasta Hut trial
had ended and that the names of all stores previously converted to Pasta Hut would be converted
back to McDonald. This was due to McDonald's online poll, where the results showed that 81%
had chosen to keep the name McDonald, 19% chose to change the name to Pasta Hut.
Consequently the name will change back, but the menus will continue to include pasta.[22]
Costa Rica
In Costa Rica, Aside from the McDonald restaurants, there is another brand called "PHD Pizza
Delivered Hot by McDonald", this brand is only for food courts at malls and for express delivery.
This was created to compete on the "fast food" market while restaurants will concentrate in
casual food.
Sponsorship
In the early 1990s, as part of PepsiCo's sponsorship of The News Hour with Jim Lehrer (and its
former moniker, "The MacNeil/Lehrer NewsHour"), McDonald was included in the
acknowledgment alongside Taco Bell and KFC, which PepsiCo owned at the time.
In 2000, McDonald was a part-time sponsor of Galaxy Motorsports' #75 Ford in the then
NASCAR Winston Cup Series, driven by Wally Dallenbach Jr.

28

McDonald was the shirt sponsor of English football club Fulham F.C. for the 200102 season.
Terry Labonte drove selected events with McDonald as the primary sponsor of his #44 car in
2005.
McDonald purchased the naming rights to Major League Soccer club FC Dallas' stadium,
McDonald Park, prior to its opening in 2005.
In March 2007, McDonald partnered with Verizon Wireless to offer a free LG mobile phone with
the purchase of a Cheesy Bites Pizza.
McDonald is a sponsor of the Newcastle Vipers ice hockey team for the 2007/08 EIHL season in
the UK.
McDonald is a sponsor of Children's Joy Foundation In The Philippines.McDonald takes great
pride and care to provide its customers with the best food and dining experience in the quickservice restaurant business. It has its outlets in many parts of India in different cities :

Delhi

Mumbai

Kolkatta

Chandigarh

Noida

Chennai

Banglore

Cochin

29

Pune

Jaipur

Jodhpur

McDonald has been a renowned restaurant since 1958. it has maintained its quality and goodwill
since then. It has also been awarded as the best restaurant chain internationally.

MCDONALD IN INDIA
Pizza have come a long way from the initial days when some of these fast food giants like KFC
were attacked, to the situation where no mall in the country is complete without the presence of
these food outlets. Though many of them made their initial entry with their international menu
but today after staying here for many years their menu has changed to serve the Indian palate.

30

First among them was McDonalds which changed its kitchen and menu to suit Indian tastes, on
which I have written earlier too, link. But the same is being followed by McDonald , a look at
their menu shows us how many special exclusive Indian pizzas they have , for vegetarians they a
host of Panner offerings and for Non-vegetarians the Kabaab and Chicken Tikka Pizzas.
McDonald Outlets - India
McDonald - Bangalore

Banaswadi
5th B cross, H.R.B.R Layout, 3rd block, Kammanahalli Main Road - McDonald

Bangalore G.P.O.
Brigade Road - McDonald

Basaveswara Nagar
LIC Colony - McDonald

Dharmaram College
Hosur Road - McDonald

MoreMcDonald - Chennai

Tharamani
Ascendes - Food Court Ground Floor Tharamani - McDonald

T. Nagar
Sir Thiyagaraya Road, Pondy Bazzar - McDonald

Mylapore
Dr. Radhakrishnan Salai - McDonald

31

McDonald - Delhi

Greater Kailash I
M Block Market - McDonald

Gurgaon
Udyog Vihar - McDonald Helpline

Hauz Khas
Grater Kailash I - McDonald

MoreMcDonald - Hyderabad

Jubilee Hills
Madhapur - McDonald

Banjara Hills
Road No. 12, A.C. Guards - McDonald
McDonald - Kolkata

Bidhan Nagar
Salt Lake - McDonald

Circus Avenue
Camac Street - McDonald

MoreMcDonald - Mumbai

I.I.T. Powai
Hiranandani Business Park - McDonald

32

Pune H.O.
Convent Street - Pizza Hultflat
Other Pizza Outlets

Domino's Pizza India

Pizza Corner India

Chapter 2
REVIEW OF LITERATURE

33

INDIAN FAST FOOD MARKET ANALYSIS: BUSINESS MARKET

REPORT
New Delhi, India, February 18, 2011: With rapidly growing middle class population and changing lifestyle, India is
blessed with one of the fastest growing fast food markets of the world. The Indian fast food market is growing at the
rate of 30-35% per annum. Almost all big fast food brands of the world have succeeded in making their presence felt
in the country and most of them are posting appreciable growth.
Consequently, all the popular fast food chains have chalked out massive plans for expanding their business and
presence throughout the country. Moreover, foreign fast food chains are aggressively increasing their presence in the
country. For instance, Dominos has planned to open 60-65 outlets every year for the next three years (2010-2012)
while Yum Brands Inc is also preparing for massive expansion across the country with plans to open 1000 fast food
outlets by 2015.
According to Indian Fast Food Market Analysis, although the market has witnessed a robust growth in the past
couple of years, it remains largely underpenetrated and concentrated into metropolitan cities. However, there is large
room for growth in tier-II cities and tier-III cities, which are mostly untapped. Therefore, the future of Indian fast food
industry lies in masses that live in tier-II and tier-III cities.
The report provides extensive research and objective analysis on the fast expanding Indian fast food market. The
report analyzes all the vital industry trends and possible growth areas for future expansion. It also analyzes important
driving forces in detail, which will help clients to understand the market better.
Moreover, we have also identified the important players operating in the sector and have made a separate chapter
which talks about their business expansion plans in detail. Most importantly, the report also features forecast on fast
food sales in the country. The forecast is based on the correlation between past market growth and growth in base
drivers such as growth in middle class, urbanization, cultural shift and lifestyle changes.
Constant Endeavour of the fast food industry to provide Indian consumers with the western and local menu has
provided impetus to their growth.

With high disposable income group ready to spend and try multiple cuisines, we can say that the
fast food industry is on the fast track.

34

As lot of Indians are travelling abroad and for business and pleasure purpose and hence are
experiencing a change in their lifestyle and are keen on trying new menus and dishes.
The success of McDonalds is a case in point. McDonalds made its India debut in 1996 and
today it has around 211 restaurants in India.
Vikram Bakshi, MD, McDonalds India (North & East), is adding that they are targeting to open
around 40 plus stores in the country soon.
With ever increasing pool of working population, nuclear families and a progressive middle
class, the demand for fast food already on the rise will see a tremendous growth in future also,
says Ritu Chaudhri, VP Marketing, Nirulas.
Nirulas has 80 in India and are planning to open 70 more till 2012.
The move to localize the fast food tastes has paid rich dividends and increased brand loyal
customer base for the companies.
MCDonald is known to introduce Indianite version of pizzas to attract the local customer base.
According to a report by ASSOCHAM, the consumer spending on processed food has increased
at an average rate of 7.6 per cent annually from 2008 to 2010 and this is expected to rise at an
average of around 8.6 per cent until 2012.
The major shift in food habits of urbanites and the interest of the rural population to try their
hands on the fats food menu has paved way to the growth of the fast food venture.
Related Articles:
As per our new research report Indian Fast Food Market Analysis, India is blessed with one of
the fastest growing fast food markets in the world. The Indian fast food market is growing at an
annual growth rate of 30-35%. Almost all big fast food brands of the world have succeeded in
making their presence felt in the country and most of them posting an appreciable growth.

35

Most of the popular fast food chains have chalked out massive plans for expanding their business
and presence throughout the country. Moreover, foreign fast food chains are aggressively
expanding their presence in the country. For instance, Dominos plan to open 60-65 outlets every
year for the next three years (2010-2012), while Yum Brands Inc is also preparing for its massive
expansion across the country. It plans to open 1000 fast food outlets by 2015.
Although the market has witnessed robust growth in the past couple of years, it remains largely
underpenetrated and concentrated in the metropolitan cities. However, there is large room for
growth in tier-II cities, tier-III cities which are mostly untapped. Therefore, the future of Indian
fast food industry lies in masses that live tier-II and tier-III cities.
Indian Fast Food Market Analysis provides extensive research and objective analysis of the
fast expanding fast food market in India. The report has analyzed all the vital industry trends and
possible growth areas for future expansion. It also analyses important driving forces in detail
which will help clients to understand the market better.
Moreover, the report has identified the important players operating in the sector and made a
separate section which talks about their business expansion plans in detail. Most importantly, the
report also features the forecast on fast food sales important economic parameters. The forecast
is based on the correlation between past market growth and growth in base drivers such as
growth

in

middle

class,

urbanization,

cultural

shift

and

lifestyle

changes.

Represent one of the largest segments of the food industry with over 200,000 restaurants and
$120B in sales in the U.S. alone. Fast food restaurants, also known as quick service restaurants
(QSRs), are noted for their short food preparation time. Some of the largest players in this
category include international giants like McDonald's and Yum! Brands, national chains such as
Wendy's and Burger King and regional players like Jack In The Box and Sonic.
Since late 2006, the fast food industry's growth has been slowed by soaring food and energy
prices The high prices of commodities, combined with the housing slump and a weakening job
market re taking a toll on restaurant spending in the U.S. (the world's largest fast food market, by
far). The same food and energy inflation that is corroding consumer spending is also taking a bite
out of company margins.

36

Fast food restaurants have navigated this difficult landscape with varying levels of success.
International players such as McDonald's (MCD) and Yum! Brands (YUM) have had the most
success as explosive growth in emerging markets has offset rising costs and a U.S. slowdown.
Other companies like Sonic and Domino's have turned to new marketing campaigns and product
innovation to boost growth and profitability.

U.S. Spending Slowdown Negatively Impacts Fast Food Sales

The U.S. accounts for the lion's share of fast food spending globally. Since the first half of 2007,
several forces have put consumer spending in this critical market under intense pressure. The
first of these is a plummeting housing market (especially in the overbuilt areas of Southern
California, Nevada and Florida) which produces a negative wealth effect among consumers,
discouraging spending. Second, rising food and energy prices have raised inflation to multidecade highs- outpacing wage gains and shrinking spending power. Finally, the U.S. job market
has deteriorated; in the first six months of 2008, the economy has shed 485,000 private sector
jobs, while many have seen job hours reduced Although some industry players, such as
McDonald's, have seen continued same store sales growth as consumers trade down to less costly
food alternatives, overall the sector has struggled. According to the National Association of
Restaurants, 55% of restaurant operators reported a same-store sales decline in March 2008
compared to just 28% who reported increases.
italic text===Rising Food Prices Pressure Fast Food Margins===

37

Historical and USDA forecasted Corn prices per bushel

Wheat prices have since risen more dramatically-Data from USDA

Several factors have contributed to a dramatic rise in food prices in recent years, including higher
oil and energy prices; the growing global demand from rapidly developing economies such as
China and India; a weak U.S. dollar; and a larger share of the grain market being diverted to
ethanol production These trends have led to the rapidly rising prices of commodities such as corn
and wheat
After labor, food and beverage inputs are the single largest cost facing fast food restaurant
operators, accounting for 33 cents for every dollar of sales. Because operating margins are
already relatively low compared to other industries (typically in the single digits) a slight
increase in these costs can have an outsized effect on profitability. For over a year now,
wholesale food price inflation has been rising at multi-decade highs. In 2007, wholesale food
prices rose 7.6%; as of March 2008 that number had increased to 8.5% on a year over year basis
At the same time, intense competition limits the ability of fast food operators to pass along rising
costs to customers. Increased costs have had a noticeable effect on fast food company earnings
with operators such as Domino's, Wendy's and Jack In The Box have all reported consistent
quarterly declines in operating margins since the second half of 2007.

38

Because franchisers capture a portion of revenue rather than profits, smaller fast food chains that
have a lower portion of their restaurants franchised are most vulnerable to cost increases. Jack In
The Box, Wendy's, and Sonic have particularly low franchised to owned restaurant rations.

PRODUCTS
CHOOSE YOUR PIZZA
CREATE YOUR OWN

Create a pizza that's custom made just for you. Start with your favorite
crust, add your toppings, and just the right amount of cheese and sauce.
ULTIMATE CHEESE LOVER'S PIZZA

Covered in creamy Alfredo sauce and topped with delicious cheeses.

PEPPERONI LOVER'S PIZZA

Layered with extra pepperoni plus extra cheese for a pepperoni in every
bite.

39

MEAT LOVER'S PIZZA

Loaded with pepperoni, ham, beef, bacon and sausage.

VEGGIE LOVER'S PIZZA

Packed with five veggies, including fresh tomatoes, mushrooms, red

onions, green peppers, and black olives.
SUPREME PIZZA

Our signature blend of pepperoni, pork sausage, beef, mushrooms, red

onions and green peppers.

40

SUPER SUPREME PIZZA

A feast of pepperoni, ham, beef, pork sausage, Italian sausage, red onions,
mushrooms, green peppers and black olives.

MEATY P'ZONE PIZZA

It's multi-meat mayhem in there. Stuffed with all your favorites - pepperoni,
ham, Italian sausage, pork, beef, and of course cheese. Served with zesty
marinara on the side.
PEPPERONI P'ZONE PIZZA

If pepperoni's your passion - lots and lots of pepperoni - this is your P'Zone.
Served with zesty marinara on the side.
SUPREMO P'ZONE PIZZA

41

Savory Italian sausage mixes with fresh green peppers and red onions in
this meat-and-veggie combo. Served with zesty marinara on the side.
TUSCANI MEATY MARINARA

Savory Italian-seasoned meat sauce and rotini pasta topped with cheese
and oven-baked.
TUSCANI CREAMY CHICKEN ALFREDO

Grilled chicken breast strips and rotini pasta oven-baked in a creamy

Alfredo sauce with a layer of melted cheese.
BUFFALO BURNIN' HOT

Extreme heat for the daring Buffalo eater.

BUFFALO MEDIUM

Bold Buffalo flavor with a spicy kick.

BUFFALO MILD

42

All the flavor without the fire.

SPICY ASIAN

Far East flavors in a spicy sweet sauce.

SPICY BBQ

Savory and sassy with just a little kick.

HONEY BBQ

Sweet taste from the honey side of the street.

LEMON PEPPER

Zesty lemon with a peppery punch.

GARLIC PARMESAN

43

The toast of Italy, the taste of two great flavors.

NAKED WINGS

No sauce, but crispy, crunchy, tender and tasty.

The bold, robust, effervescently magic cola.

DIET PEPSI

Light. Crisp. Refreshing. With zero sugar, zero calories, and zero carbs.
MOUNTAIN DEW

Way more energizing and thrist quenching, with a one-of-a-kind great taste.
SIERRA MIST

44

Crisp, clean and refreshing lemon-lime soda with natural lemon and lime
flavors and just the right amount of sweetness to invigorate your

senses and leave you totally refreshed.

MCDonald sells pizzas in four different sizes: personal (individual serving), small,
medium and large, though most stores have done away with the small size. A variety of
toppings are available, plus "specialty" styles, including Meat Lovers, Pepperoni Lovers,
Cheese Lovers, Veggie Lovers, Double Cheeseburger, Supreme, Super Supreme and the
newly introduced Pizza Mia. The pan pizza has a thicker crust than most other
commercially available pizzas.
MCDonald also sells Stuffed Crust pizza, with the outermost edge wrapped around a coil
of mozzarella cheese; Hand-Tossed, more like traditional pizzeria crusts; Thin 'N Crispy,
a thin, crispy dough which was MCDonald's original style; Dippin' Strips pizza, a pizza cut
into small strips that can be dipped into a number of sauces; and The Edge pizza, where
the toppings nearly reach to the edge of the pizza. There was also formerly a crust that
was not as thick as MCDonald's pan pizza, and not as thin as its thin crust. This crust was
used on the Full House XL pizza and discontinued in 2007.[9]
MCDonald experiments with new products frequently, with less successful ones being
discontinued. These include the initially popular two-foot by one-foot square cut pizza
Bigfoot, the 16" Big New Yorker, made with a sweet sauce, the Chicago Dish Pizza and
Sicilian pizza, the latter also offered in 2006 as Lasagna Pizza. Other products MCDonald
has offered are the "P'zone", MCDonald's version of the calzone; the Cheesy Bites pizza,
similar to the Stuffed Crust pizza except the crust has been divided into 28 bite-sized
pieces that can be pulled apart; and the Insider pizza, where a layer of cheese is in
between two layers of dough. Another limited time offer was a Double Deep pizza with

45

double the toppings and 50% more cheese, with the crust wrapped over the top to hold in
all the toppings. In 1985 MCDonald introduced the Priazzo[10], a two-crusted Italian pie
that resembled a deep-dish pizza. Varieties included Priazzo Milano, a blend of Italian
sausage, pepperoni, beef, pork fillings, a hint of bacon, mozzarella and cheddar cheese;
Priazzo Florentine, a light blend of five cheeses with ham and a touch of spinach, and
Priazzo Roma, stuffed with pepperoni, mushrooms, Italian sausage, pork filling, onions,
mozzarella and cheddar cheese. The double-crusted pie was topped with a layer of tomato
sauce and melted cheese. The Priazzo was introduced by a $15 million advertising
campaign, but proved too labor-intensive and was removed from the menu several years
later.

In addition to pizza, also sold is garlic cheese bread (not in all locations), plus a number
of side dishes including bread sticks, cheese sticks, cinnamon sticks, mozzarella sticks,
onion rings, chicken wings (some stores have integrated with another chain known as
WingStreet which offers a wide variety, such as Buffalo Burning Hot, Buffalo Medium,
Buffalo Mild, Honey BBQ, Spicy BBQ, Garlic Parmesan, Cajun, Spicy Asian) boneless
wings,
chicken munchers, jalapeo poppers, Quepapas (potato bites filled with
cheese and jalapeo flavor), a basket of taters or tater tots and fried apple pies. Depending
on the
individual restaurant size, MCDonalds also may offer pasta dinners such
as spaghetti and Cavatini a mixture of Cavatelli (shells), Rotini (spirals), and Rotelle
(wheels).
A new, upscale concept was unveiled in 2004, called "MCDonald Italian Bistro". Unveiled

46

at fifty locations nationwide, the Bistro is similar to a traditional MCDonald, except that
new, Italian themed dishes are offered, such as penne pasta, chicken pomodoro, toasted
sandwiches and other foods. Instead of black, white, and red, Bistro locations feature a
burgundy and tan motif.[ MCDonald Bistros still serve the chain's traditional pizzas and
sides as well. In some cases, MCDonald has replaced a "Red Roof" location with the new
concept.
A new version of MCDonald pizza, named Pizza Mia which is lightly cooked and topped,
was introduced in 2007. The product is aimed at the cost sensitive consumer segment and
is priced similarly to the Domino's 555 deal, where each pizza is priced at five dollars if
purchased in bulk of three or more. In comparison, a MCDonald medium sized, handtossed pepperoni pizza is internationally priced at $10.24 (Dallas, Texas 1/1/2009). The
Pizza Mia comes in only one size (medium) and extra toppings range from $1.25 to
$1.49. One slice of MCDonald pepperoni Pizza Mia weighs 83 grams, while one slice of
MCDonald pepperoni hand-tossed pizza weighs 96 grams.
MCDonald on May 9, 2008, created and sold in Seattle, Denver, and Dallas, The
Natural, a new all-natural multi grain crust sweetened with honey, a red sauce of organic
tomatoes and topped all-natural cheese (or with all-natural chicken sausage and roasted
red peppers). A medium Natural pizza with one topping sold for $9.99. This was
discontinued on October 27, 2009 in the Dallas market. It has since launched a
nationwide advertising campaign. Also in 2008, MCDonald created their biggest pizza
ever, the Panormous Pizza. It has 16 pieces.
MCDonald introduced the Big Eat Tiny Price Menu on June 21, 2009. It features new
Pizza Rolls, the P'Zone Pizza, new Personal Panormous Pizza, and the Pizza Mia Pizza,

47

each item starting at $5.00 or $5.99.

MCDonald introduced stuffed pan pizza on August 23, 2009 with $10.99 for one toppings
and specialty for $13.99. Unlike regular stuffed crust cheese is not inside the crust, just
pressed into the pan crust.
Understanding the market place
It consists of five steps:
Needs , wants & demands
Marketing offer
Customer value & satisfaction
Exchange & relationship
Market

48

NEEDS ,WANTS AND DEMANDS :

Need:
To eat something good its customer need and MCDonald fulfill their need according to
theirexpectations and fulfill the desire of hunger.
Wants:
Mainly pizza of MCDonald is not the basic need of people but it is a want of those who
wantsome extra or they want to celebrate some specific occasion, and they celebrate
thesewith MCDonald.
Demand:
MCDonald also give considerable and proper attention to demands of people. In new
product development, MCDonald considers demands of people specially. There areseveral
steps to
go through before they launch a new product.
The first step is to carry out research to find out:

What people think about pizzas (what role do they play in people's lives, when do

they eat them and so on)?

What do they like about pizzas?

49

What do they dislike about pizzas?

What do they want from pizzas?

Marketing offer:
MCDonald creates a market offer very much according to market. It is offered to satisfy
need or want. The information is collected together and used to create ideas for
prototypes. The ideas are tested first, before they make any pizzas.
Customer value & satisfaction:
MCDonald create certain expectations among its customers, is fulfilling it accurately, and
get a good image in minds of customers. Its customers are satisfied by its quality as it
satisfies their expectations. They give basic priority to their customers.
Exchange & relationships:
MCDonald has maintained very good relationships with its customers. It believes on
exchange through relationships. They create relationships by offering the best product
and best services to their customers for example they are offering to their customers
home delivery services & providing products according to customers requirement.
Market:
MCDonald is entering in global as well as local market. Being that MCDonald holds the
mostmarket in the pizza industry all around the world, they perceived quality and service
of thecompany will help to ensure a better than average chance at a successful
introduction of anew product. The pizza industry firms are famous for introducing new
products to sparkshort-term sales in available marketplaces. MCDonald as stated earlier
has been verysuccessful at accomplishing this in different markets. The introduction of a
product thatkeeps with today's trends is also important to reduce the risk of failure. In
recent years,there has been an increase in the marketing of products with an extreme

50

twist to them.Mountain Dew, which is a brand name owned by MCDonalds parent

company, PepsiCo, hasbeen very successful at repositioning itself to this segment of the
market, which hassparked new interest in the soft drink. Many other imitators have
followed their exampleand have been successful as well. MCDonald has the resources
available to research andimplement a new product with great success in globally
marketplace.

51

1. CUSTOMER DRIVEN MARKETING STRATEGY:

MCDonalds marketing strategy is very simple: we want to satisfy our customer boffering
them the best. Their main segment which they have captured is combination of higher
incomes & dual career families. Their maximum market segment is younger generation
ranges from 12-30.
Another big strength and even a competitive advantage is the fact that they have a full
service restaurant as well as delivery services. Most of MCDonald's competitors do not
haverestaurants. Because of the restaurant, MCDonald can market to different segments
thatother pizza chains cannot. For example, MCDonald can market to families much
easier thanDomino's or Little Caesar's. MCDonald offers a sit-down, conversational type
restaurantwhere families can take their children for birthday parties. MCDonald's broad
selection ofproducts also makes it easier for them to market to different market
segments.

The other two strategies followed by MCDonald are C.H.A.M.P.S (Cleanliness,

Hospitality,Accuracy, Maintenance, Product quality and Speed) and 3Fs (Fun, Friendly
& Familiar).
These two strategies have really helped MCDonald to evolve out as a market leader with
acompetitive advantage

52

MCDONALD IN INDIA

Pizza have come a long way from the initial days when some of these fast food giants like
KFC were attacked, to the situation where no mall in the country is complete without the
presence of these food outlets. Though many of them made their initial entry with their
international menu but today after staying here for many years their

53

menu has changed to serve the Indian palate.

First among them was McDonalds which

changed its kitchen and menu to suit Indian tastes, on which I have written earlier too,
link. But the same is being followed by MCDonald , a look at their menu shows us how
many special exclusive Indian pizzas they have , for vegetarians they a host of Panner
offerings and for Non-vegetarians the Kabaab and Chicken Tikka Pizzas.

MCDonald Outlets - India

MCDonald - Bangalore
Banaswadi
5th B cross, H.R.B.R Layout, 3rd block, Kammanahalli Main Road - MCDonald
Bangalore G.P.O.
Brigade Road - MCDonald
Basaveswara Nagar
LIC Colony - MCDonald
Dharmaram College
Hosur Road - MCDonald
More
MCDonald - Chennai
Tharamani
Ascendes - Food Court Ground Floor Tharamani - MCDonald
T. Nagar
Sir Thiyagaraya Road, Pondy Bazzar - MCDonald
Mylapore
Dr. Radhakrishnan Salai - MCDonald
MCDonald - Delhi

54

Greater Kailash I
M Block Market - MCDonald
Gurgaon
Udyog Vihar - MCDonald Helpline
Hauz Khas
Grater Kailash I - MCDonald
More
MCDonald - Hyderabad
Jubilee Hills
Madhapur - MCDonald
Banjara Hills
Road No. 12, A.C. Guards - MCDonald
MCDonald - Kolkata
Bidhan Nagar
Salt Lake - MCDonald
Circus Avenue
Camac Street - MCDonald
More
MCDonald - Mumbai
I.I.T. Powai
Hiranandani Business Park - MCDonald
Pune H.O.
Convent Street - Pizza Hultflat
Other Pizza Outlets
Domino's Pizza India
Pizza Corner India

55

56

MCDONALD LAUNCHES NEW MENU AND AD

CAMPAIGN
23 Dec 2011
In a recent development, India's leading
affordable casual dining restaurant brand,
MCDonald has unveiled their new menu
with an addition of 30 items in their
offerings. Further, the pizza restaurant has
also launched a new brand campaign
What are you celebrating today? to
promote

the

launch.

With a 27 per cent market share of the

eating-out market and over 70,000 footfalls per day across the country, MCDonald is
geared to provide diners with the ideal place to build memories and relationships over
delicious food. In an effort, the chain has introduced four new Appetisers, seven exciting
Pastas, two new Pizzas, five more Desserts and twelve delicious Beverages.
The new range includes some of the new offerings like Potato Criss Cuts, Creamy Spinach
and Mushroom Pasta, Ultimate Adventure Pizza, Choco Chip Cookie Sundae and Grape
Sangria Cooler.
Further, the newly launched campaign showcases MCDonald as the perfect place to
celebrate and it also highlights the thirty new menu offerings that go beyond just pizzas,
including sauted pastas, starters, drinks and desserts.
MCDonald is one of the flagship brands of Yum! Brands, Inc., which also has KFC, Taco
Bell, A&W and Long John Silvers under its umbrella. MCDonald is one of the largest
casual dining restaurant chain with over 12,500 restaurants across 91 countries and 140
stores across 34 cities in India.

57

MCDONALDS FRANCHISING NETWORKS IN INDIA

The MCDonald franchise stepped into the Indian fast food market by opening a dine-in
restaurant at Bangalore in 1996. The pizza franchise soon expanded itself in India and
now has the KFC brand beneath its umbrella. The fast food franchise was the first
international fast food firm to make an entry into the Indian scene and has thus pioneered
the Indian pizza market.

58

The menu provided at the MCDonald franchise is that of a complete meal. Customers are
considered as honoured guests at the fast food franchise and are treated accordingly. It is
the customer satisfaction provided by the specialty food franchise that enabled it to
position itself at the top of the Indian fast food market.

The fast food franchise also ensures that it adds an Indian touch to all the varieties of
pizzas that it makes available to Indian customers. Various delicious combinations are
tested at the Indian MCDonald franchisee outlets by blending the original menu with
Indian favourites to make fresh salads, garlic based breads, soups, yummy pastas and
delicious desserts.

The employees of the restaurant support centre of the MCDonald fast food franchise which
functions in New Delhi works hard to place MCDonald at the top of Indian market. The
support centre takes care of finance, legal and marketing sides of the Indian operations of
MCDonald franchisees.
Globalization of fast food industry

McDonald's in Moscow
In 2006, the global fast food market grew by 4.8% and reached a value of 102.4 billion
and a volume of 80.3 billion transactions.[19] In India alone the fast food industry is

59

growing by 40% a year.[20]

McDonald's is located in 126 countries and on 6 continents and operates over 31,000
restaurants worldwide.[21] On January 31, 1990 McDonalds opened a restaurant in
Moscow, and broke opening day records for customers served. The Moscow restaurant is
the busiest in the world. The largest McDonalds in the world is located in Beijing,
People's Republic of China.]
There are numerous other fast food restaurants located all over the world. Burger King
has more than 11,100 restaurants in more than 65 countries. KFC is located in 25
approximately 39,129 restaurants in 90 countries as of May 2009[ the first non-US
with 100 locations in China. Taco Bell has 278 restaurants located in 12 countries
besides the United States.

60

Pizza in India
Pizza is a emerging fast food in Indian urban areas. With the arrival of branded pizza
such as Domino's and MCDonald in early to mid 1990s, it has reached almost all major
cities in India by 2010 Pizza outlets serve pizzas with several India based toppings like
Tandoori
Chicken and Paneer. Indian pizzas are generally made more spicy, compared to their
western
counterparts, to suit Indian taste. Along with Indian variations, more
conventional pizzas are also eaten. Pizzas available in India range from localized basic
variants available in neighborhood bakeries to gourmet pizzas with exotic and imported
ingredients available at specialty Italian restaurants.

Health issues
Pizza can be high in salt, fat and calories. There are concerns about negative health
effects.[15] MCDonald has come under criticism for the high salt content of some of their
meals which were found to contain more than twice the daily recommended amount of
salt for an adult.[16]
European nutrition research on the eating habits of people with cancer of the mouth,
oesophagus, throat or colon showed those who ate pizza at least once a week had less
chance of developing cancer, they found. Dr Silvano Gallus, of the Mario Negri Institute
for Pharmaceutical Research in Milan,[17] who led the research said: "We knew that
tomato sauce could offer protection against certain tumors, but we did not expect pizza as
a complete meal also to offer such protective powers." Nicola O'Connor, of Cancer
Research UK, told BBC News Online: "This study is interesting and the results should
61

probably be looked at in the context of what we already know about the Mediterranean
diet and its association with a lower risk of certain types of cancer.

"The secret is probably lycopene, an antioxidant chemical in tomatoes, which is thought

to offer some protection against cancer, and which gives the fruit its red color.
"But before people start dialing the local pizza takeaway, they should consider that some
pizzas can be high in saturated fat, salt and calories". In contrast to the classic Italian
pizza used in the research, most UK pizza takeaway varieties are often loaded with high
fat cheeses and fatty meats, a high intake of which can contribute to obesity, itself a risk
factor for cancer. "Our advice is to enjoy selected Italian pizza (i.e., healthy pizza) in
moderation as part of a balanced diet that includes plenty of vegetables and fruit."
Italian Carlo La Vecchia, a Milan-based epidemiologist said Italian pizza lovers should
not see the research as a license to indulge their fondness for pizza food. "There is
nothing to indicate that pizza is the only thing responsible for these results." He
continued: "Pizza could simply be indicative of a lifestyle and food habits, in other words
the Italian version of a Mediterranean diet." A Mediterranean diet is rich in olive oil,
fiber, vegetables, fruit, flour and freshly cooked food - including traditional Italian
healthy pizza.

62

NAMES AWARDED TO MCDONALD

For ten of the last twelve years, MCDonald was named Best Pizza Chain in America in
the"Choice in Chains" national consumer survey published annually by Restaurants &
Institutions Magazine.In 1997 Consumer Reports named MCDonald the best pizza chaiin
America and in 2000and 2003, The Dallas Business Journal named MCDonald "The Best
Company to Work For"in Dallas/Fort Worth.Restaurants & Institutions' "2001 Choice
inChains" survey called MCDonald the numberone national pizza chain in America.

63

ON

INDIAS

BURGERS,

PIZZAS

&

CAF

LATTE

MARKET II : YUM BRANDS

This

second

post

in

the

series

is

on

the MCDonald andKFC company, Yum Brands. This is a company with

aggressive intent. Before looking at the India operations, lets take a
helicopter view to see where Yum comes from.
Yum Brands
First, digest this. There is something about the year 1996 and Indias fast
food market. Three leading (arguably the top three) fast food brands in
India

today

viz.

McDonalds,

MCDonald

and

Caf

Coffee

Day, all commenced operations in India in the same year 1996!

Yum Brands
McDonalds was covered in the previous post. MCDonald is owned by Yum
Brands (Yum), a Fortune 500 company that also owns KFC, Taco Bell
(Mexican), Long John Silvers (seafood) and A&W (a minor brand).
MCDonald, KFC & Taco Bell were earlier owned by Pepsi. In 1997, Pepsi
having nurtured the fast foods business for many years, spun off these three
brands into a new entity, later christened Yum Brands.
Yum is the second largest QSR company worldwide in terms of revenue,
after McDonalds. In terms of number of restaurants, they claim to be
number one globally, with 36,000 numbers as against McDonalds
(32,000) and Subways (also 32,000).

64

At $11.3 Billion in revenue in 2008, Yum Brands is about half the size of
McDonalds (revenues $23.5 billion), however.
International focus
Yums core brands viz. MCDonald, KFC and Taco Bell each trail
McDonalds and several others in the home (U.S.) QSR market. Also, the
U.S. market is under pressure due to the downturn in the economy.
Consequently, Yum is focused on the international market.
Yum is uniquely structured as 3 separate Divisions, one for the U.S., one for
China and one for the rest of the world (International) : these three
currently bring in approximately 5, 3 and 3 billion dollars in revenue per
annum respectively. 60% of their operating profit is from overseas.
Yum has about 33,000 outlets of which 20,000 are in the U.S., 3,000 in
China and 13,000 in International. The company believes it can grow to
40,000 outlets internationally and, separately, to 20,000 in China alone.
This means potentially Yum can be a 80,000 outlet company (assuming
very conservatively no growth in U.S outlets). In 2008, Yum added about
1,500 outlets worldwide. Given that they currently have 36,000 outlets, the
above rollout can take them nearly 30 years!
India is going to be Yummy
India? There are 147 MCDonald and 52 KFC restaurants i.e. 199 Yum
restaurants in India today, per available information. With this number,
India currently ranks 16th by the number of restaurants in Yums portfolio
of 110 countries.

65

A MCDonald restaurant
Yum is targeting 1,000 outlets in all from India by 2015. If this sounds
small in relation to their global plans, consider this: this target is
considerably higher than that of other QSR brands for India. (We dwell on
plans of other brands in subsequent posts). They are setting aside $150
million for investment in India between now and 2015 and seeking a
revenue (in 15) of $ 1 billion.
And, unlike McDonalds, India does get a fair mention in the companys
plan (Yum Annual report 2008). You get the feeling that the India
operation is getting a fair bit of attention as part of an overall BRIC
strategy.
Accordingly, in a move of some symbolic significance, Yums 13,000th
International restaurant, a KFC, opened recently in Saket, Delhi. And it was
a KFC with a new touch; theyve brought in their new Kruger drinks line
there.
In addition, there is the Micky factor. They have Micky Pant as their Global
Brand Officer (you may have heard of him in his earlier avatar Muktesh
Pant : he used to run marathons while he was at Reebok India). This

66

highest ranking Indian in the Yum hierarchy is responsible for

International marketing and the Yum brands.
But China is much more Yum
If you think India is coasting along fine, spare a thought for China. As
mentioned above, Yum is targeting 20,000 units in China; they say they
want China to be as big as McDonalds is in the U.S.. Today, Yums China
revenues are comparable to the revenues from the rest of the world.
In China, Yum currently has 3,000 outlets, with KFC across 500 cities and

MCDonald across 100.

Of the 20,000 outlets targeted in China, they are looking at 15,000 outlets
for KFC, 5,000 for MCDonald Home Service(which is the same number
competitor and pizza home delivery leader Dominos Pizza has in the U.S.)
and 2,000 forMCDonald Casual Dining (which is the number the
U.S. casual dining leader Applebee has in the U.S.).
They have also created a new local brand for (guess what) Chinese fast food
(what else

called East Dawning.

Note: We havent heard of any vada pao, pao bhaji, paratha oridli
dosa initiatives from Yum yet.
Why does Yum do better in China

67

The lack of a cold chain outside select locations is considered to be a factor

hindering QSR rollouts in India. I wonder whether the expansion in China
is because they have developed such a cold chain by virtue of the
infrastructure advantage China enjoys. Yum is present in just 39 odd cities
in India as against the 500 plus in China.
Or, is Yum available in more cities in China because the average city there is
larger ? Or, because of the higher per capita income ? Or, is it all of the
above ?
China has just 660 cities of which as many as 171 have a population of over
a million each and another 279 have a population between 500,000 and 1
million (2002 data) . India has over 5,100 cities as per Census of India, but
only 35 odd are over a million in size and another 50 odd are between
500,000 and 1 million (Census of India, 2001).
Its not only Yum (MCDonald and KFC) . Most food services chain in India
have not gone beyond 50 cities yet (exception : Cafe Coffee Day).
In China, Yum is available in 500+ of the 660 cities already. No wonder,
they are talking of 20,000 units there.
In contrast, by 2015, Yum is planning to be available in just 62 cities in
India, up from current 39.
Here is a recent report on culture innovation that is underway at Yum
Brands.

68

ENVIRONMENTAL FACTORS
MCDonald environment factors we explained with the help of PEST Analysis.
PEST (Political, Economic, Social & Technological)
I.

POLITICAL ISSUES :
Political issues include regulatory framework operating in judicial system, which may
affect the business in different ways. Political factors, which may affect MCDonald, are
fiscal policy, monetary policy, tax laws and changes, IP protection, copyrights and
security laws.
In globally locations, MCDonald has to follow rules and regulations according to
legislation
of that country.

II.

ECONOMIC FACTORS :
Economic factors include GDP rate and GDP growth, exchange rates, unemployment
levels, skilled labor, education levels, infrastructure and healthcare. If GDP of the
country is high then this is green signal for the business as per capita income of the
people will be increased and they will spend more money. In our study, we came to
know that most ofthe people in last years spend more and they visit MCDonald very
often.When inflation rateincreases buying power of people decreases and they spend
less on eating pizza.

III.

SOCIAL FACTORS:
Social factors include demographics, income distribution, social stability, consumerism,

69

discretionary income, savings rate, fashion, foods and trends. MCDonald is a

multinational and it is originated from America so the organization is overwhelmed by
western culture. There are social forms of society, which consist of Upper class, middle
class, middle upperclass, lower class. Every country has its own cultural norms, values,
beliefs and religion, which can affect the MCDonald according to its location.

IV.

TECHNOLOGICAL FACTORS:
Technological factors include new technologies, material technologies, process
technologies, information technologies, commercial technologies, government incentives
and energy costs. Now a days technology is improving day by day so as baking and
heating ovens will be of new and efficient technology and will provide efficient service.
Due to new technology, there are new ways of marketing like internet; telemarketing and
MCDonald can advertise its products with much more faster pace. Computer based
customer data that is MIS (managing information system) helps in collecting customer
data, daily transactions, future forecasting and decision making. New vehicles will make
its service more efficient.
MCDonalds segmentation
MCDonald is mainly targeting its market on the base of multiple segmentation
(Geographical, Demographical & Psychographic segmentation). MCDonald has its
franchises in Delhi, Mumbai ,Kolkatta,Noida ,Banglore,etc. These franchises are made
on the bases ofgeographical segments. They have focused on the income and lifestyle

70

of the customers.
Main segments, which MCDonald has captured, are the combination of higher incomes
and dual career families, due to higher income consumer have more disposable income,
allowing them to eat out more often.MCDonald maximum market segment is younger
generations. These generation rangesfrom 12 to 30, the overall spending of these
generations is mostly on non-essential items,the higher amount of spending has been
done on eating out.
MCDonald has made different or varieties of pizzas. Such as hot and spicy pizza, Seekh
Kabab and Tikka pizzas, which are not found in Western countries? The help of
geographical segment makes these pizzas.
On the occasions, such as in Ramadan month, MCDonald gives offers in Sehri and Iftari.
This segment is called behavioral segment. Giving offers on the special purpose to gain
more sales and increase profits. The pricing strategy will also help segment the market.
Different groups of customers are willing to pay different prices for the same product.
TARGET MARKET
MCDonald has targeted its market by targeting families who like to go out for dinner once
in a week. And by this MCDonald have made different offers and varieties of different
pizzas and prices to attract them. They have made an excellent services and clean
environment for the families to sit and enjoy their time with the pizzas. MCDonald has
made delivery services for those customers who like to have pizzas in their home with
their families or friends.
They are targeting everyone whereas their competitors target a certain gender or age.

71

MCDonald targets a wide range of customers. This is because they want to make the
mostmoney.
They have many competitors and they are bound to try everything to cope up tops. Their
competitors are everywhere. There are just a few that are main competitors and pizzahut
always try to be the best and get the most money by making their products quality better.
They try to offer something different with their product as well. They offer a range of
stuffed crusts to try and attract customers. They also do vegetarian options with meet
freepizzas and a salad and pasta bar. Not a lot of restaurants offer a salad and a pasta
bar.This is another competitive edge to attract or customers. Spending habits of college
freshmen also indicates a high percentage of money being spent on non-essential items.
VALUE PROPOSITION
MCDonald decides how they will serve their customers, how they will differentiate and
position themselves in the marketplace? Therefore, they promise to deliver the different
set of benefits and values to consumers to satisfy their needs. They serve customers by
delivering their products at doorstep. MCDonald also has to meet up the inspirational value
proposition for its pizzas in smaller towns, which is again very tricky.
POSITIONING
A critical factor in MCDonald's success has been its unique dining experience. Positioning
involves implanting the brands unique benefits and differentiation in customers minds.
MCDonald have made many advertisements in which they have differentiate their pizzas
inquality, uniqueness, taste and by also offering varieties of pizzas. They have
broadcastedtheir advertisements through Newspaper, Television, Radio, and Billboards.
WheneverMCDonald offers news deals, then they gives advertisements to radio or

72

television and theymake billboards and place where their customers are.
MCDonald was among the first multinational brands to enter the food retail sector in
INDIA. When the first MCDonald restaurant opened in INDIA the quick service
industrywas at a nascent stage and the pizza category was dominated by a sole regional
playerwho had a marginal presence. MCDonald went on to play a significant role in
pioneeringand developing this category in India
Worldwide and in india MCDonald has come to become synonymous with the 'best
pizzas under one roof'. This is because at MCDonald the belief is that every pizza has its
own magic, thus making it a destination product which everyone seeks. It is this belief
that has ignited the passion to create, innovate and serve the finest product the industry
has to offer, while setting standards for others to strive to replicate. MCDonald is
committed to providing uncompromising product quality, offering customers the highest
value for money and giving service that is warm, friendly and personal. They use strong
brand image and high price for high quality products for positioning their positive image in
the minds of customers.
Crewmembers at MCDonald strive each day to provide 'CUSTOMER MANIA' - the kind
of
service that ensures that every visit of the customer is a memorable one. In this way
MCDonald, position itself in its customers mind.

73

SLOGANS
MCDonald make their slogans by finding unique features of their products to position
themselves. Slogans create positive image in customers mind. Their slogans are
matchedwith their product quality and services. Followings are the some slogans of
MCDonald;

Share the good times

We have Pizza

Now youre eating

Making it great!

You'll love the stuff we're made of.

The best pizzas under one roof.

Gather 'round the good stuff.

UNIQUE SELLING PROPOSITION
Competitive advantage is the MCDonalds brand name. MCDonald has built a brand name
that means quality products and services. They make and sell their product according to
place, regional values and norms. They always follow the customer need, want and
demand, to make their product more reliable in customer mind. MCDonald through quality
and quick services always maximize their market share. That is why their product is
unique in all around the world.

MCDonald- Fresh, hot pizza delivered in thirty minutes or less

or it is free

74

BUYING BEHAVIOUR OF
CUSTOMERS
There are certain buying habits of the customers. According to the buying behavior of

thecustomers, there are four types of buying decision behavior. Which are;

Complex buying behavior

Dissonance-Reducing Buying Behavior

Habitual Buying Behavior

Variety-Seeking Buying Behavior

Customers of MCDonald are different in buying the pizzas. Customer follows variety
seekingbuying behavior in buying the pizza. When buying pizza they may hold some
beliefs,choose a brand without much evaluation then evaluate type of pizza during
consumptionbut next time he/she may pick another type of pizza of boredom or simply to
trysomething different. Brand switching occurs for the sake of variety rather than cause
ofdissatisfaction. This is the situation characterized by low involvement but
perceivedbranddifferences.
MCDonald has made good reputation of their products and services towards their
customers. However, as customers attitude of buying is variety seeking buying behavior.
MCDonald is a restaurant of pizzas, and there are many competitors who are also
differentiating their pizzas and services to attract customers. Therefore, by

75

this,customersneed some changes according to their taste and those brands, which are
giving moreoffers with the pizzas.

Those customers who have beliefs on the MCDonald are loyal with them. They are not
switching their brand and only trying different pizzas. However, who are not loyal with
their taste

CUSTOMER LOYALITY PROGRAMES

What is a Loyal Customer: Customers with a long record of purchases from a
preferredprovider caused by their psychological and emotional bond with that provider.

MCDONALDS CUSTOMER LOYALTY PROGRAMES

In response to increasing competition and declining sales MCDonald began a
comprehensive customer loyalty initiative in 1995.through marketing research the
company aimed to improve guest satisfaction and unit level execution at over 37000
company owned stores and about 200 franchised restaurants. By presenting restaurants
managers with weekly feedback from their customers MCDonald hoped the feedback
would strengthen operations within the control of each restaurant manager. The plan
itselfwas comprised of two components; customer service 1-800 number and a customer
loyalty survey.

1-800 customer service number:

76

For the first time in its history MCDonald introduced a customer satisfaction hotline. The

77

INDIAN TARGET
MCDonald to operate 250 restaurants in India by 2015
Press Trust of India / New Delhi Dec 19, 2011, 17:47 IST
Having completed 15 years of operations in India, casual dining chain
MCDonald is looking to enhance its presence across the country and run 250
outlets by 2015.
Besides strengthening retail presence, MCDonald is also looking to expand its
product offerings to consumers.

Also Read

Related

News

Stories

Now

Q&A: Niren Chaudhury, Yum Brands

Jubilant Foodworks: Not so hungry
For a bigger slice
Yum! Brands eyes Rs 4,600 cr from Indian ops by 2015
Dominos: Delivery wonder
Indian Hotels Company sells loss-making arm

78

"There are 131 MCDonalds in 34 cities of India at present. The plan is to take
this count to 250 by 2015," MCDonald India Marketing Head Sunay Bhasin
said.
The expansion would also happen in tier II and tier III markets, he added.
To commemorate 15 years of operations in India, MCDonald is set to roll out
a nationwide marketing and advertising campaign.
"A new nationwide ad campaign would be launched by the end of the week,"
Bhasin said without providing information on the amount to be spent.
At the same time, a new range of 15 different pizzas would be rolled out at
stores across the country.
"The 15 pizzas are inspired from regional cuisines and flavours from around
the country," he added.

79

FUTURE PLANS
According to Yum! Restaurants International, India is amongst the top five
growth markets for MCDonald MCDonald is also experiencing double-digit
growth in India and hence is confident about expanding its
operations in India.MCDonald hopes to increase the number of Pizza
Hut outlets in India to 130 by the end of 2005 from the present figure of 95.
The expansion programme will make MCDonald the fastest growing western
restaurant chain in India. In addition, Yum! plans MCDonald to be in 35 cities
by end of 2005, and 55 cities by end of 2006.

80

Customer Satisfaction in 7 Steps

1.

Encourage Face-to-Face Dealings

This is the most daunting and downright scary part of interacting with a
customer. If you're not used to this sort of thing it can be a pretty nervewracking
experience. Rest assured, though, it does get easier over time. It's important
to meetyour customers face to face at least once or even twice during the course
ofa project.

2.

Respond to Messages Promptly & Keep Your Clients Informed

This goes without saying really. We all know how annoying it is to wait days
for a response to an email or phone call. It might not always be practical tdeal
withall customers' queries within the space of a few hours, but at least email
orcall themback and let them know you've received their message and you'll
contactthem about itas soon as possible. Even if you're not able to solve a
problem right away, let thecustomer know you're working on it.

3.

Be Friendly and Approachable

A fellow Site Pointer once told me that you can hear a smile through the
phone. This is very true. It's very important to be friendly, courteous and to
make yourclients feel like you're their friend and you're there to help them out.
Therewill betimes when you want to beat your clients over the head repeatedly
with ablunt object- it happens to all of us. It's vital that you keep a clear head,
respond to yourclients'wishes as best you can, and at all times remain polite and

81

4.

Have a Clearly-Defined Customer Service Policy

This may not be too important when you're just starting out, but a clearly
defined customer service policy is going to save you a lot of time and effortin the
long run. If a customer has a problem, what should they do? If the first option
doesn'twork, then what? Should they contact different people for billing and
technicalenquiries? If they're not satisfied with any aspect of your customer
service,whoshould they tell? There's nothing more annoying for a client than
beingpassed fromperson to person, or not knowing who to turn to. Making sure
they knowexactly whatto do at each stage of their enquiry should be of utmost
importance. Somake sureyour customer service policy is present on your site
5.

Attention to Detail (also known as 'The Little Niceties')

Have you ever received a Happy Birthday email or card from a company you
were a client of? Have you ever had a personalized sign-up confirmation
email for aservice that you could tell was typed from scratch? These little niceties
canbe timeconsuming and aren't always cost effective, but remember to do them.
Even if it's as small as sending a Happy Holidays email to all your customers,
it's something. It shows you care; it shows there are real people on the otherend
ofthat screen or telephone; and most importantly, it makes the customer
feelwelcomed,wanted and valued.

82

6.

Anticipate Your Client's Needs & Go Out Of Your Way to Help Them Out
Sometimes this is easier said than done! However, achieving this supreme
level of understanding with your clients will do wonders for your working
relationship.

7.

Honour Your Promises

It's possible this is the most important point in this article. The simple
message: when you promise something, deliver. Clients don't like to be
disappointed.Sometimes, something may not get done, or you might miss a
deadlinethrough nofault of your own. Projects can be late, technology can fail
and subcontractorsdon'talways deliver on time. In this case a quick apology and
assurance it'll beready ASAPwouldn't go a miss.

83

OBJECTIVE OF THE STUDY

To study the SWOT (Strength, Weakness, Opportunities, Threats) of

the Customer.

To understand the buying behavior of a customer when he is buying

MCDonald products.

Prevailing attitudes and perceptions about the products in term of

quality, price and availability.

To study the Customer's behavior towards the Customer and

Company.

Is the advertisement MCDonald product effective.

To study the brand image

To know the Customer network in same segments.

84

RESEARCH METHODOLOGY
PROBLEM DEFINITION

Statement of the problem:

A Study of Consumer Retention in MacDonald

Background of the problem:

MCDonald has always been successful in delivering the best fast- food. It has
gained many customers throughout the world and has always been working on
customer- retention. This research is conducted as MCDonald wants to know
the preferences of their current valued customers so that they can serve them
in a more satisfactory way and improve their overall performance.

RESEARCH DESIGN
The research we conducted is descriptive as well as theoretical in nature.
INFORMATION NEEDS

Data collection:
There was secondary data available in this context for MCDonald. We
collected primary data from people.

Scaling Technique:
We used the non-comparitive scaling technique in our questionnaires.

Questionnaire Development:
While developing the questionnaire, I focused mainly on questions that
showed the preference of the fast-food customers with respect to food quality,
85

price, environment, services, etc. and could give us a clear impact of the most
preferred element.

Pre- testing:
In pre-testing we got the questionnaires filled by 100 people from within our
population. There was no problem faced by the population and they found the
questionnaire easy to understand and fill and we could also figure out the
results from the answers. Thus, we felt no need of any change in the
questionnaire.

Sampling Techniques:
The sampling technique used by us in this research is Judgmental Sampling.

Sample:
We took sample size of 100 people

Method:
We analyzed the results by making pie charts for all questions.

86

SWOT ANALYSIS
1.Strengths :
MCDonald is the market leader in providing different products of pizzas as there are no
competitors in this sector. There good image makes the organization more strong. Pizza
Hut is providing good taste, quality products with qualified staff, good atmosphere and
hygienic environment. They are specialized in pizzas. Motivation level of staff is veryhigh
which make the organization more prosperous. They are ISO (International Standard
Organization) certified. They have enough resources for operating different activities of
the organization. They are providing free home delivery service. They have created
monopoly in this sector. Another big Strength and even a Competitive Advantage is the
fact that they have a full service restaurant as well as delivery services. For example,
MCDonald can market to families much easier than Domino's or Little Caesar's.

2. Weaknesses:
However, the fact that MCDonald does have a restaurant to run is also a weakness.
PizzaHut has higher overhead costs, due to the restaurant that other competitors do not
haveto deal with. Another result of higher overhead costs is higher prices MCDonald must
charge. Obviously, MCDonald is not the low cost producer. They rely on their quality
pizzaand good service to account for their higher prices. They are providing less range
ofproducts comparatively with high prices. Its some more weaknesses are;
They are more focused on Western taste instead of Eastern. It gives less parking
facilities,its advertisements are very less, it has still fewer outlets and it is working less
for socialwelfare.

87

3. Opportunities:
New markets can be explored and new opportunities they can gain. MCDonald can come
upwith the new products considering the Eastern taste of the people as like McDonalds.
Diversification of new products can increase their market share. They can reduce their
prices because of more resources. It should avail these opportunities. More outlets
shouldbe open, Broader Sitting Area, More Attractive Environment; Attractive offers
should beintroduced, ordering Online System.

4. Threats:
MCDonald's number one threats are from their competitors. Currently,
Their closest competitor is Domino's Pizza who is working to open their Branch at
india. Domino's main competitive advantage over MCDonald is their Lower price.
Little Caesar's who is establishing their self in India and might move to India is
another one of MCDonald's competitors, right behind Domino's in market share.
Little Caesar's is famous for offering large quantities of pizza for less money.
New entrance like Dominos pizza in Pakistan market can affect their market share.
Other local restaurants can affect their market share by providing pizzas with lower
price. Social factors can affect their image as a Western organization, Instant Fast

88

DATA ANALYSIS

Q1). Do you like fast food?

yes

77

No

23

It was observed that 77% people like fast food as compared to 23%
people who were not to fond of fast food.

89

Q2).Which of the following joints do you prefer?

KFC

25

Mc Donalds

23

MCDonald

48

It was found out that more people were fond of visiting Pzza Hut than any other joint.

90

Q3) Have you ever visited MCDonald?

Yes

68

No

32

It was observed that more than 32% people had never visited MCDonald before.

Q4) Which factors affect your preference while choosing a place for hostelling?
91

Physical
environments

Interior

Service

Food
quality

Price

25

23

11

18

16

It was observed that people preferred the quality of food over other
factors while choosing a place for hostelling.

Q5).Do you think MCDonald offers variety of food?

92

Yes

68

No

32

It was found that 68% thought that MCDonald offered variety of food .

Q6) Do you visit MCDonald as it has a good brand image?

93

Yes

62

No

38

This shows that people didnt merely visit MCDonald because of its image but
because it served good food.

Q7) Do you think MCDonald delivers the best food?

94

Yes

64

No

36

People who visited MCDonald felt that the food delivers was good as compared to few
who didnt like the food served at MCDonald.

Q8).Are you satisfied with the ingredients used in the food items?

95

Yes

68

No

42

After analysis it was found out that most people were not satisfied with the ingredients
used in the pizzas.

96

Q9)Do you think MCDonald is consistent with its food qualities whenever you go?

Yes

74

No

26

Most people felt that MCDonald offered consistently good food while some people felt
that the quality of the toppings, cheese etc were not good at times.

Q10) Are you satisfied with the services of MCDonald ?

97

yes

50

No

50

People had mixed feelings about the services offered by MCDonald.

98

Q11).do you think that the preparation of food in MCDonald is hygienic?

Yes

55

No

45

Some people who are regular visitors of MCDonald felt that the preparation of food in
MCDonald was at times unhygienic.

Q12).are you satisfied by the prices charged by MCDonald?

99

yes

64

no

36

Around 64% people felt that the prices charged by MCDonald were unreasonable.

Q13) Are you satisfied with the home delivery of MCDonald?

100

yes

82

no

18

It was seen that people were satisfied with the home delivery of MCDonald
While some people felt that delivery was not done on time.

101

RECOMMENDATIONS

There are some points, which MCDonald must follow to have more customers and
increase sales and profit in the market and in order to finish the threats.

MCDonald should focus on more advertisements, as in India , they are not making
advertisements. They should telecast their advertise more and on the right time when
their loyal customers and the target customers are watching the television. By this,
they are positioning their products in their customers minds. They should make an
attractive one in which they are differentiating their pizzas in quality, taste and tells
that how nutrition and healthy meals they are offering.

More advertisements of MCDonald is been watched by the customer then the

Variety seeking buying behavior of the customer will also decrease. The customers will
Become loyal to it.
They should make discounts cards or the membership cards for the loyal customers.
Those customers who mostly go once in a week or after two weeks.
They should reduce their price as compare to the competitors price and if not then
they should differentiate their product in their quality and taste. They should also tell
that they are using more toppings and cheese.
They must sponsor more concerts and games held in india, as they do not do. By
this, they will make a good reputation to towards their customers.

102

 They should make stalls in the universities and colleges when there are some parties
held. In the stalls, they must offer pizzas in student discounted prices.
In order to move effectively into the rapidly progressing world of social responsibility, it
is time for business to expand their vision.
They should make its own website in which customers can place an online order.
Customers can now go on the Internet and place an order. This method is useful
because it allows customers to view the entire menu, download any special coupons
,and order without having to disclose any credit card number.

103

CONCLUSION
MCDonald has many targets, which it has achieve in a given period. The time-period is
mostly a year. Therefore, in order to fulfill the targets different strategies are adopted by
MCDonald. It can be concluded that these strategies have been successful and there is
flexibility in the strategies, as they can be changed with the changes in the market
conditions as well as the targets.
Need to be just a step aheadin sync with the consumers perception of value.
Customers move to the lower cost provider when marketers stop giving them reasons
not to.
Never before, never again
Strategy is only as good as its execution
Not just product, but an experience.
Its strategies are successful and there is flexibility in the strategies, as they can
be changed with the changes in the market conditions as well as the targets.

104

LIMITATIONS
There were certain limitations that we faced while doing this project. These limitations
Include.
The limited time.
Limited budget.
Resistance of people to fill the questionnaires.
To gather adequate information about MCDonald from its management.
The study is based on one year only.
Price level changes are not considered.
Time is short for deep research.
Separate records of the all units are not available.
The readjusted and regroup figure slightly affects the value.
Study is limited of MCDonald.
The data is used in the project have been taken from annual report only. Hence,
grouping and sub grouping and annualisation of data may slightly affect the results.

105

BIBLIOGRAPHY
Marketing Management by Philip Kotler, Pearson Education 2nd ed.
Consumer Behavior by Leon G.Schiffman, Prentice-Hall India 8th ed.
IRDA Journal
Newspaper and Business magazines

PRIMARY DATA
Data was collected through questionnaires and by one to one interaction with
people who regularly visited MCDonald

SECONDRY DATA
www.pizzahut.com
www.google.com

106

QUESTIONNAIRE
Name:
Contact number:
Address:

1. Do you like Fast Food?

Yes
No

2. Which of the following joints do you prefer?

KFC
Mc Donalds
MCDonald
3. Have you ever visited MCDonald?

Yes
No
4. Which factors affect your preference while choosing any place for hostelling?

Physical environment
Interior
Service
Food Quality
Price
5. Do you think that MCDonald offers enough variety of food?

Yes
No
6. You visit MCDonald as it has a good Brand Image?

107

Yes
No

7. Do you think MCDonald delivers the best food in town?

Yes
No
8. Are you satisfied with the ingredients used in its food items?

Yes
No
9. Do you think MCDonald is consistent in its food quality whenever you go?

Yes
No
10. Are you satisfied with the service of MCDonald When you dine in?

Yes
No
11. Do you think that the preparation process of food in MCDonald is hygienic?

Yes
No
12. Are you satisfied with the prices charged by MCDonald?

Yes
No

108