Factors Affecting Mcdonald's

McDonalds was founded in 1943, and 1967 British Colombia was its first international expansion, advertising to middle and upper class. McDonalds decided to expand internationally, due to the enormous success in America. There was heavy research involved in the expansion. Through globalization and internationalization, McDonalds were able to develop marketing strategies according to cultural needs, to serve specific target markets. McDonalds enter India’s foreign market and 1996 and is a tough foreign market to enter, but with McDonald’s success they were able to earn high revenue in India. The success strategy is researching and the development of food. McDonalds thoroughly analyzed the preferred taste, especially to not offend locals. Their key to success is to “think global, act local.”

1) Set out the main criticisms that have been leveled at Mc Donald’s in Europe. To what extent are these criticisms likely to be replicated in Asia? What differences can be predicted?

A Multicountry approach is one in which as organization’s strategies vary according to the countries in which it does business (Coulter, 2013, p.202). This approach is centered on creating an advantage through differentiation. The products, marketing, and distribution are tailored and adopted to local culture and customs. Such local responsiveness is important when significant country to country differences exist (Coulter, 2013, p.203). An example of this would be McDonald’s Corporation. To appeal to the local customers’ palates in Singapore, they added rice burgers – fried beef slices served between two pressed rice cakes, to its menu.

McDonald’s has developed a series of marketing strategies to meet is mission and challenges. One of them is its adaption to local preferences. Let’s take India as an example. “Many Indians are either Hindus or Muslims. The article “Etiquette in Indian Restaurant” indicates that “in Hinduism, the cow is considered a sacred animal so it cannot be eaten; Similarly, Muslims consider the pig to be a very filthy animal so it cannot be eaten”. Because of such religious beliefs, most restaurants do not serve beef and pork. So there is only Chicken on the McDonald’s menu. Besides that, Indian prefer spicy food, even the sundae is spicy. Thanks to that, McDonald’s has remarkable achievements in its global expansion. Two-thirds of its new restaurants are opened outside America.

Globalization refers to the “tendency of investment funds and businesses to move beyond domestic and national markets to other markets around the globe, thereby increasing the interconnectedness of different markets. Globalization has had the effect of markedly increasing not only international trade, but also cultural exchange”³. Globalization is closely related to foreign investment in the sense that foreign investment is a contributing aspect of globalization. It has also been noted that globalization can especially impact developing countries as it “helps developing nations "catch up" to industrialized nations much faster through increased employment and technological advances” . McDonald’s is a prominent example of a company that has embraced the opportunity to globalize and achieve success doing so. McDonald’s is the largest fast food restaurant chain in the world consisting of more than 35,000 outlets spread across 118 countries. Although the company was founded in the United States, they have not limited themselves to North America; they now spread worldwide into every continent. Similar to their global growth increase, the company has also seen their revenue tremendously increase as they continue to share their product with more and more people around the world. “McDonald’s key to success is its business mantra of “think global, act local”. This has allowed the company to achieve financial success in every region it opens its fast food restaurants”4. McDonald’s has clearly found the right strategy in terms of growing their product internationally as they’re seen to be one of the most successful companies doing so, their numbers support their success as they receive around 65% of their revenue from international

Due to globalization and increased competition in the fast food industry, a very complex environment is created for McDonald’s. There are various internal and external environmental factors affecting the functions of McDonald’s corporation and demands for new innovations. The factors are as follows:

McDonald's is the world's leading food service retailer with more than 30,000 restaurants in 119 countries serving 47 million customers each day. It is one of the worlds most well-known brands and holds a leading share in the globally branded quick service restaurant segment of the informal eating-out market in every country they do business. McDonald’s marketing strategy is having friendly people serving the right product with affordable prices. McDonalds’s showcase their restaurants as clean, comfortable and welcoming, and create promotions that resonate with key consumer groups. They want to stay in tune with customer’s lifestyle.

McDonalds needs to constantly examine trends and to come up with new and improved innovative strategies to maintain its competitive advantage so that it does not lose its position to competitors. In addition, since McDonalds is global, this may be a more difficult challenge. Therefore, McDonalds must pay special attention to various outside forces, such as changes that occur within different country’s economies, laws, or local area concerns.

When going global, and in order to succeed in international business, understanding consumer behaviours based on their values and perception of other countries is key for implementing a proper winning marketing strategy. Cultural dimensions help managers and multinational companies respond effectively and positively to values and behaviours that shape a given nation and that might be completely different from the way an organization is accustomed to behave in its country of provenance. McDonalds represents a suitable model of multinational companies that succeeded in translating cultural differences into their products, marketing efforts and practices. In Morocco, McDonalds serves “Halal” options that go in line with the predominant Muslim community, whereas in France you can order wine with your meal, and in a different context, the company banned beef products in India because of the taboo around it and introduced vegetarian alternatives that suit the populations’ preferences and tastes.

Identify the key elements in McDonald’s global marketing strategy. In particular, how does McDonald’s approach the issue of standardization? Does McDonald’s think global act local? Does it also think local and act global?

McDonald’s is a famous fast food brand in the word which owns 35,000 outlets located in 119 different countries. In 1990, the first McDonald’s store opened in Shenzhen. But before they actually started their business, McDonald’s had already carried out 5 years business research and all sorts of information gathering such as the income level of the Chinese people, the kind of foods they enjoy etc (Han, J. 2008). For product perspective, McDonald’s create a standardized set of products that taste similar no matter in United State or in China. According to the research, they found cost saving by standardization as “think global, act local”.

Fast food markets industry overcrowded in the developed economies. With Burger King, Kentucky Fried Chicken, Wendy’s, and many fast food restaurants on the rise, these fast food restaurants serve as threats to McDonald’s.

This report focus on the strategic analysis of McDonald’s Corporation. The analysis emphasize on improving McDonald’s competiveness in the challenging fast food industry by using appropriate theoretical model. This report begins with the history of McDonald’s establishment; its goals; vision and mission; industry life cycle; and business strategy. Then, it goes on to analyze the main theoretical model of strategic analysis which include PESTLE analysis, Porter’s Five Forces analysis, SWOT analysis and core competencies of McDonald’s Corporation. Next, the report links the findings by synthesizing the theories with each other. This report finally concludes the findings and makes suggestions for improvement.

Public companies have a variety of stakeholders, such as shareholders, bondholders, bankers, suppliers, employees, and management. All these stakeholders need to monitor the firm and to ensure that their interests are being served. They rely on the company’s financial statements to provide the necessary information (Brealy et al., 2008).

McDonald's es el líder mundial en restaurantes de servicio de comida rápida con más de 30,000 locales sirviendo a cerca de 50 millones de personas en 119 países cada día. Actualmente la compañía esta