Contents

INTRODUCTION...........................................................................................................................................2
Market Analysis...........................................................................................................................................2
Globalization of Market.......................................................................................................................2
Globalization of Products....................................................................................................................2
Political Environment...........................................................................................................................3
Economic Environment........................................................................................................................3
Legal Environment...............................................................................................................................3
Cultural Environment..........................................................................................................................4
Conclusion...................................................................................................................................................4
References...................................................................................................................................................5
McDonald’s | Asian Market - India

INTRODUCTION
McDonald's is an American fast-food company, originated in 1940
by the two brothers Richard and Maurice McDonald, in San
Bernardino, California, United States. In 1953 they franchised their
company with the golden “M” logo. Later, in 1955, Ray Kroc, a
businessman, joined the company as a franchise agent and purchased
this chain. The original headquarters was in Oak Brook, Illinois, but
moved to Chicago in June 2018. McDonald’s globally guarantees high quality products and
quick service, in a clean, welcoming environment, at reasonable pricing. Despite their relatively
low pricing in India, they managed to maintain quality and globalize, simultaneously.

The first launch in India dates back to 1996. Having sustained in this state for 24 years,
McDonald’s now has over 400 restaurants across the country, run by two Indians as a joint-
venture, Amit Jatia, M.D. Hardcastle Restaurants Pvt. Ltd. and Vikram Bakshi’s CPRL. The list
of products offered in India is long, with exclusives such as Maharaja Mac, Big Spicy Paneer
Wrap, Green Chili Aloo Naan, etc.

Market Analysis
Globalization of Market

McDonald’s marketing scheme for India is advertisements on TV, radio, in cinema, online, and
in newspapers and magazines; and promotional methods include sales promotions, point of sale
display, merchandising, direct mail, loyalty schemes, door drops, and instore promotions. The
company’s main global strategy is to attract the children by offering small toys along with their
Happy Meals. This way, the rest of the family followed. McDonald’s adopted the local language
throughout the state to counter the language barriers. India is mostly a collectivist country and
thus, the family dining concept was addressed by their family friendly campaigns and taglines:
 McDonald's mein hai kuch baat. (Oct. 13, 1996–1999)
 Toh aaj, Mmmmmmmmmm! McDonald's ho jaye. (1999–2003)
 I'm lovin' it (2003–present)
Moreover, “Aap ke zamaane mein baap ke zamaane ke daam” is a highly localized campaign
which focused on attracting crowds with their affordable “happy price” menu.

Globalization of Products

In terms of product globalization, McDonald’s created an

excellent example. McDonald’s localized their products
75% for India. As for religious reasons demand of Beef and

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McDonald’s | Asian Market - India

Pork is very little in India. Hence, McDonald’s

introduced “Maharaja Mac” with mutton patty to
replace Big Mac (Beef). Their exclusive Indian
menu also includes McAloo Burger, McAloo
Tikki, Green Chili Aloo Naan, Veggie
McNuggets, and Veg Pizza McPuff. McDonalds
continuously changes and adapts their food
offerings for consumers. Furthermore, special sauces like McMasala and McImli were
introduced to suit the Indian taste buds; also, mayonnaise and all other sauces are made egg-less
for the vegetarians. They initiated Cold Chain across India to keep their products fresh and full
of nutrition.

Political Environment

During their initial launch in India, McDonald’s had to face

a lot of hate from the Hindu political parties and even had
their branches attacked. Eventually, McDonald’s built its
place by introducing a completely customized menu to cater
to the Indian consumers’ demands. Now the government of
India has implemented 100% Foreign Direct Investment
(FDI) for food and manufactured products which gives
McDonald’s an excellent opportunity to expand and invest
more in India. India’s ministry of labor and employment
offers the benefit of “Minimum Wage Bill” which
positively impacts profitability of McDonald’s. Their
political campaign “#MakeYourChoice” encouraged people
to vote for their vote in the ongoing General Elections.

Economic Environment

By calculation, India’s individual disposable personal income will rise further. In 2016-17,
disposable personal income of India was US$2,278.89 and personal expenditure of consumers
was US$250.88 billion. And, during 2011-2012, India’s total GDP was US$1827.64 billion and
by 2016-2017, India’s total GDP became US$2,439.01 billion with a positive increase of
US$611.37 billion. And as per World Bank’s estimate India’s annual growth will reach to 6.5%
by 2017-18. India’s booming economy, low tax rate and availability of workforce are beneficial
to McDonald's profitability. India is a hyper price sensitive market. Customers in India, were
attracted solely by the low prices and hence it was compulsory to reduce cost by using local
supply of production and efficient workforce, and also by producing in bulk and introducing
“self-service”. As India’s currency-inflation rate is higher, Gap on currency rate effects
fluctuations import and exports of MacDonald’s.

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McDonald’s | Asian Market - India

Legal Environment

Food Safety and Standards Authority of India (FSSAI) issued to label-stickers of detailed
ingredients of foods, several food businesses came under a strict scrutiny by food safety
organizations for nutritional values. The state’s health and hygiene regulations require
McDonald’s to guarantee use of fresh and nutritious ingredients because their products contain
high calorie and trans-fat. India has very complex labor law and licensing system as government
permitted operating hours and specified working hours for women employees has to be
maintained.

Cultural Environment

Massive cultural barrier for McDonald’s to enter Indian Market was the food habits as Indians
like hot and spicy food cooked mainly with vegetable oil. Initially, McDonald’s face opposition
from health activists, environmentalists and religion activists. To penetrate Indian market
successfully, McDonald’s has to continuously adapt their menu accordingly. Due to religious
reasons in India, demand of beef and pork is very low. McDonald’s used Corporate Social
Responsibility (CSR) strategies to counter the negative image and associate themselves with
many community welfares projects. In India, consumers are also divided in two groups,
vegetarian and non-vegetarian. The firm has to offer specialized menu complementing both
groups. India’s culture being collectivist and family focused, McDonald’s position themselves as
a family restaurant. They launched breakfast combos, happy price combos to address India’s
communist and diverse nature. Furthermore, there are numerous languages throughout India and
McDonald’s had to use at least 8 languages for national launches to tackle this massive
communication barrier. In addition, 50% of the state was considered to be illiterate and audio-
visuals and billboards had to be used to address the lack of literacy.

Conclusion
So as to sustain in a very competitive market such as India, McDonald’s has to continuously
bring in new concepts of both, product and promotion. They had to cut down costs efficiently to
sustain in India’s Price sensitive market. The globalizing nature of McDonald’s adds a
competitive edge over the others within this industry and has helped attain great popularity
amongst its target customers. If maintained, the quick service, quality food, affordability and fair
pricing McDonald’s will help to keep its position at the top of the fast food industry.

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McDonald’s | Asian Market - India

References
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Kapoor, S. (2018, March). ANALYSIS AND CRITICAL EVALUATION OF STRATEGY FOLLOWED BY

McDONALD'S INDIA. Retrieved from ResearchGate:
https://www.researchgate.net/publication/323706269_ANALYSIS_AND_CRITICAL_EVALUATION
_OF_STRATEGY_FOLLOWED_BY_McDONALD%27S_INDIA

Mcdonald Adaptation In India Marketing Essay. (1970, January 01). Retrieved from UKEssays:
https://www.ukessays.com/essays/marketing/mcdonald-adaptation-in-india-marketing-
essay.php

McDonald’s Entry to India. (n.d.). Retrieved from Assignment Point:

https://www.assignmentpoint.com/business/mcdonalds-entry-to-india.html

McDonald's . (n.d.). Retrieved from https://www.mcdonalds.com/us/en-us.html

McDonald's India. (n.d.). Retrieved from https://www.mcdonaldsindia.com/products.html

Rangnekar, A. (2014, May ). McDonald's India Entry Strategy. Retrieved from ResearchGate:
https://www.researchgate.net/publication/289521379_McDonald's_India_Entry_Strategy

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