McDonald’s

Case Study
Team Netflix

Akash Kumar 18MI31003

Ankur Saini 18MI31023
Ratul Pan 18MI10031
Sarthak taunk 18MI10040
Samiksha Sharma 18MI31015
 Business Model of McD
Brand’s Mission - “Quality, Service, Cleanliness, and Value,”
Profound Growth Strategy -
1. McDonald's remains committed to growth, continuing its aggressive
deployment of the three growth accelerators Digital Platform, Delivery
and Enhancement of its future in the US.
2. The Velocity Growth Plan, introduced in 2017, is McDonald's
customer-centric strategy that focuses on the key drivers of the business —
food, value, and customer experience.
3. Its growth strategy is based on Retain, Regain, and Convert. McD works
hard to retain its old customers, regain the lost trust, and convert casual
customers into regular ones.
Reasons for McD’s stumble
● The revenues and earnings of McDonald hit record levels in 1997, as
they have every year since the company was founded in 1955 but those
trends reflect developments overseas, where McDonald's was expanding
rapidly.
● In an effort to stimulate sales, McDonald's Corp. asked its 12,200 U.S.
chains to drop the price of the Big Mac sandwich to 55 cents from $1.90.
● The nation's biggest fast-food restaurant chain hoped the proposal,
dubbed Campaign 55, would reverse the decline in sales because of
increased competition. The move also came just months after the
company introduced several high priced sandwiches.
● The growing fear, in fact, was that the company was facing a problem that
marketing cannot overcome: as too many fast-food fans thought its
burgers do not taste as good as the food sold by competitors.
How McD restored operations
● Owing to widespread and growing discontent among its franchisees, the
McDonald's Corporation cancelled all lunch and dinner promotions built
around discounting sandwiches to 55 cents.
● McDonald' stated that there was ''a midcourse correction'' in Campaign
55, which continued in the form of breakfast My Size meals, which
offered various combinations of food built around the 55-cent theme. The
company characterized the response to the breakfast packages as
''outstanding'' and devoted more advertising in promoting them.
● So, they again focused on advertisement and tried to better their own
products. McDonald's Happy Meals included toys like the popular Teenie
Beanie Baby Promotion in 1996 and 1997 and established a Global
Marketing Alliance with Disney/Pixar in 1998. They advertised towards
children targeting popular toys that children would be drawn towards.
Competitive landscape of McD
● McDonald's vs Burger King & KFC – Fast Food Chain- The biggest
rivals of McDonald's in this category are KFC and Burger King.
McDonald's is constantly updating their menu to keep its less-loyal
customers coming back to them. McDonald's regularly announces new
meals for a limited amount of time to attract new customers and create
awareness.
● McDonald's vs Starbucks & Dunkin Donuts – Beverages - Even
though the main business of McDonald's is selling meals at any time of
the day, it has also tapped into the market of Starbucks and Dunkin
Donuts with a specific chain – McCafe.
● McDonald's vs Local Restaurants - . Traditional restaurants cater a
different target audience but address the same need as fast-food chains
and that is why they are a competitor of McDonald's.These restaurants
are focused on delivering a personal experience to their customers.
McD’s promotional strategy
● Some international companies make an effort to adapt their products to
various different cultural environments and McDonalds is one of them.
This marketing adaptation strategy enables the company to reach more
consumers all over the world.
● McDonald's offers a very wide menu adapted to the population of India.
They replaced beef with chicken in their meals and even plan to open
completely vegetarian restaurants. As cows are considered sacred, the
Big Mac became the Maharaja Mac.
● At first India seemed totally incompatible with McDonald's core business
and really looked like a difficult and risky market to enter for the American
fast-food company, but the company took its time to analyse the market
and understand the population's needs and tastes.
Franchisee vs own shops - McD Case
● McDonald’s started its business as privately owned but later shifted to
franchisee model.
● McDonald’s earns royalties through selling rights to operate the
fast-food chain called as franchisees.
● The company continues to evolve to a more heavenly franchised
business model, and is currently about 93% franchised along with end
term goal of 95%.
● McDonald’s gives their franchisees to enjoy freedom in terms of
creativity and innovation in business.