International Journal of Scientific and Research Publications, Volume 2, Issue 9, September 2012 1

ISSN 2250!15!
Strategy and Repositioning the Brand McDonalds in
India
Sameer, Sharanbir Kaur
Abstract- "espite #lobal slo$do$n, Indian econom% is
resur#ent and offers fresh opportunities as $ell as challen#es to
#lobal pla%ers& 'c"onald(s still treats the Indian mar)et as one
of their %oun# mar)ets althou#h $hat the% ha*e achie*ed in 15
%ears here, it $ould usuall% ta)e them 25 to !0 %ears in another
mar)et& 'c"onald(s philosoph% of +ualit%, Ser*ice, ,leanliness
and Value -+S,.V/ is the #uidin# force behind its stellar
ser*ice to the customers& 0o$e*er there is still a hu#e potential
in the Indian food mar)et that remains untapped in terms of
famil% restaurants, 1uic) ser*ice restaurants and brea)fast
eateries& ,omin# in the $a)e of these, their rebrandin# effort
re1uires much more than a mere chan#e of the lo#o or si#na#e&
2here is a need to criticall% e*aluate the ri#ht mar)etin# mi3&
2he article is focused upon assessin# the mar)etin# efforts in
India in terms of positionin# of 'c"onald(s&
Index Terms Rebranding, Repositioning, Demography,
Marketing Mix
Indian spends 4ust 5 11 as
compared to his ,hinese
counterpart $ho $ould ideall%
spend 5 20 on fast food& 6et , if
$e see the Indian spendin# on
food in totalit% , the% spend 2!
7 of their earnin#s on the
same $hile the ,hinese
spendin# is 20 7& So, the
inference that can be dra$n is
that o$in# to the eatin# pattern
of Indians the% prefer to eat at
home and $ould spend on
coo)in# in#redients o*er fast
food& 0o$e*er, this does not
spell #ood ne$s for the
industr%& It is set to $itness the
entr% of ne$ fast food pla%ers
that plan to hit the Indian
mar)et $ith a *en#eance $ith
international #iants li)e
"un)in "onuts and Starbuc)s
bein# amon#st them&
II& 208
,9'P8
2I2I9N
People prefer fast food because
it:s cheap, eas% to prepare, and
hea*il% promoted& India is a
de*elopin# countr% $ith 2
percent of or#ani;ed and 9<
percent of unor#ani;ed sector&
So most of the fast foods that
came into Indian mar)et as
India has a hi#h #ro$th in
e*er% sector& 'a4or pla%ers in
fast food in India are=
I& >?S2 >99"
IN"@S2R6 IN IN"I?
2
he Indian fast food industr% has e*ol*ed
o*er time and al$a%s has been in line $ith the
needs of people of all a#es and se#ments& 2here
are enterprises $hich scale from one room outlet
to a chain ha*in# hundreds of outlets li)e
'c"onalds in
India&
?s per ne$ research report AIndian
>ast >ood 'ar)et ?nal%sis , India is
blessed $ith one of the fastest #ro$in#
fast food mar)ets in the $orld& 2he Indian
fast food mar)et is #ro$in# at an annual
#ro$th rate of !0!57& ?lmost all bi# fast
food brands of the $orld ha*e succeeded
in ma)in# their presence felt in the
countr% and most of them postin# an
appreciable #ro$th& ?lthou#h the mar)et
has $itnessed robust #ro$th in the past
couple of %ears, it remains lar#el% under
penetrated and concentrated in the
metropolitan cities& 0o$e*er, there is
lar#e room for #ro$th in tierII cities, tier
III cities $hich are
mostl% untapped&
2herefore, the
future of Indian fast
food industr% lies in
masses that li*e in
tierII and tierIII
cities&
In 201!, the
#lobal fast food
mar)et is
forecasted to ha*e a
*alue of 5200
billion, an increase
of 29&!7 and a
*olume of 9B&C
billion transactions,
an increase of
10&B7 since 200<&
2he consumer
spendin# on
processed food has
increased at an
a*era#e rate of C&D
per cent annuall%
from 200< to 2010
and this is e3pected
to rise at an a*era#e
of around <&D per
cent until 2012,
accordin# to a
report b%
?ssocham&
?lmost all bi#
fast food brands of
the $orld ha*e
succeeded in
ma)in# their
presence felt in the
countr% and most of
them are postin#
appreciable #ro$th&
It is estimated
throu#h the
8uromonitor
International and
,redit Suisse
8mer#in#
,onsumer Sur*e%,
that the a*era#e
McDonalds KFC
'ore than
C57 of
'c"onald:s
restaurants
$orld$ide are
o$ned and
operated b%
independent
locals&
'c"onald(s
product line in
India is almost
similar to other
bur#er chains
$ith a dominant
Indian fla*our&
Perhaps, it $ould
be correct to sa%
that their onl%
similarit% $ith
their forei#n
outlets is that the%
ha*e >rench >ries
and still use buns&
83aminin# the
immense
Indian;ation the%
ha*e attempted in
their menu here it
$ouldn(t be
surprisin# to see
Indian ,hapatis in
place of buns&
2heir current
offerin#s reflect
the same&
www.ijsrp.org
International Journal of Scientific and Research Publications, Volume 2, Issue 9, September 2012 2
ISSN 2250!15!
able I ! "resent Menu #or McDonalds India
Menu Burgers and Desserts Be$erages
Ranges other Bites
Spicy 'cSpic%Paneer Ei# Spic%
Delights Paneer
Frap
%&tra'alue ,hic)en >ilet 9 >ish 'ahara4a 'ac 'cVe##ie
Meals 'cNu##ets 'eal 'eal G'c,hic)en
'eal 'eal
(appy 'c?loo 2i))i Soft Ser*e Ve# Pi;;a ,hic)en 'cS$irl IcedteaG
"rice -Stra$berr% 'cPuff 'cHrill ,old
Menu G,hocolate/ ,offee
Brea)#ast Sausa#e Ve# Ve# 'c'uffin Sausa#e Panca)es 'inute
Menu 'c'uffin $ith Supreme 'c'uffin 'aid
e## Pulp%
9ran#eG
,appucinoG
2ea
Fa$ourites >rench >ries >ilet 9 >ish ,hic)en 'c,hic)enG 'c>lurr%
'ahara4a 'ac 'cVe##ie
(appy 'c?loo 2i))i 'c,hic)en ,hic)en 'cVe##ie
Meals 'eal meal 'cHrill 'eal 'eal
Source= 'c"onaldsIndia&com
III& E@SIN8SS '9"8I
2he Eusiness 'odel of 'c"onald(s is a franchisebased model coupled $ith stron# corporate brandin#& 2he focus is on the
brandin# of 'c"onald(s as a #loball% accepted ser*ice pro*ider $ith stron# customer perception about=
www.ijsrp.o
rg
International Journal of Scientific and Research Publications, Volume 2, Issue 9, September 2012 !
ISSN 2250!15!
(appy %mployees means (appy Customers -
McDonalds %##orts o# repositioning its Brand
Recentl%, 'c"onald:s mana#ement has decided to chan#e
itsstrate#ies& 2he% no$ $ant to pro*ide not onl% a place to sit
and eat but also an e3perience that can be en4o%ed b% their
customers&
Figure *! he Ser$ice Mar)eting riangle
+eithaml and Bitner ,*--. /
'c"onald(s reali;ed *er% earl% in their business that in
order to achie*e happiness amon#st customersJthe possible route
is throu#h happ%, moti*ated and committed emplo%ees& In
accordance $ith this the% pla%ed on the customer first strate#%&
8*en in India, their efforts clearl% indicated that the% $ere )een
to understand the Indian consumer& 0ence the% adapted
themsel*es to tic)le the taste buds of their Indian customers to
become a brand that en4o%s a *er% hi#h brandrecall&
2herefore the% focused on internal as $ell as e3ternal
mar)etin#&2he le*el of importance has chan#ed to be in the
follo$in# order -the most important people areno$ at the top/&
Corporate Branding - 2he mar)eters are shiftin# the
brandin# efforts from their product brands to a more holistic
corporate brandin# &2he reason for the shift can be traced to the
belief that, it is the corporate ima#e that carries a #reat impact on
the bu%ers $ho are more a$are and more e3posed to media
co*era#e on *arious issues be it en*ironmental responsibilit%,
bein# corporate social responsibilit% or be it responsibilit%
to$ards health of future #eneration&
'c"onald(s describe a corporate brandin# frame$or) that is
based on three elements=
Figure 0! Corporate
Branding
Source! (atch and
Schult1 ,2330//,
4Bringing the
Corporation into
Corporate
Branding5, %uropean
6ournal o#
Mar)eting,
2he recent 'c"onald(s
rebrandin# strate#% is a part of
this thou#ht and *ision&
'c"onald(s road to success
has not al$a%s been ros%&
2he% ha*e been at the
recei*in# end of the media(s
onslau#ht& 2here $as a hu#e
uproar in @S after media
e3posure a#ainst 'c"onald(s
unhealth% menu that $as
affectin# the nation and
leadin# it to a #eneration
sufferin# from obesit% and
heart diseases amon# man%
more ailments&
2here $ere emplo%ment
issues internall% $hich
sho$ed that the% did not treat
their $or)ers $ell& 0ence the%
assessed their strate#ies a#ain
and came up $ith ne$
ob4ecti*es that stren#thened
their pre*ious aims and #a*e a
ne$ direction to them as $ell&
Figure 2! McDonalds Ser$ice "yramid
www.ijsrp.org
International Journal of Scientific and Research Publications, Volume 2, Issue 9, September 2012 B
ISSN 2250!15!
McDonalds Mar)eting %##orts 7$er the 8ears 9
"roacti$e Rebranding 9 ? Proacti*e strate#% includes a
ne$ line of business or mar)et that does not conform to the
e3istin# brand identit%& Fhen 'c"onald(s once referred to itself
as 'ic)e% "(s to tar#et )ids in a commercial, it had 4ust coined
a ne$ $a% of caterin# to an audience separate from its
traditional famil% audience&
7b:ecti$es o# McDonald;s Repositioning Strategy-
'c"onald:s, the promise of ?merican fast food an%$here in the
$orld, has had to rethin) and reposition its brand offerin#s in
different countries& Fhile some basic elements li)e Ronald $ere
left in place the menu under$ent an o*erhaul& >or e3ample, in
India, the menu has no beef dishes since it is not considered
reli#iousl% correct to eat co$(s meat= there is the *er% popular
'c?loo2i))i, a potatobased patt% in bur#er bunsJ the Ei# 'ac
is replaced b% the 'ahara4a 'ac, the Ei# 'ac in chic)enJ there
is also the paneer -cotta#e cheese/ 'cVe##ie bur#er&
2he Italian 'c"onald:s has a special coffee spot& 2o
celebrate its 20th anni*ersar% in ,hina, 'c"onald:s rebranded
under the K'a)e Room for 0appinessK campai#n& 2he% had all
%ou $ant coffee refillsJ Fi>i and a more modern restaurant
desi#n $ere un*eiled& 2his $as done e3clusi*el% for ,hina,
$here 'c"onald:s positioned itself as a place to rela3 a$a%
from the hi#h demands of the a*era#e ,hinese(s life& Its KI:m
Io*in:
ItK slo#an made $a% for K'a)e Room for 0appiness,K and
'c"onald:s became the place $here the stressed %oun# ,hinese
can spend 1ualit% time re4u*enatin# after $or)in# for lon#
hours& 2he result $as an 1<7 increase in sales, and an
increasin# le#ion of fans that is fuelin# 'c"onald:s: #ro$th in
,hina&
McDonalds Changing Mar)ets Changing Strategies
"ecades after its launch, the Ei# 'ac is chan#in# colours,
literall%& 2he $orld:s lar#est fastfood chain is lettin# #o of its
familiar redand%ello$ colours for more muted tones as it #oes
for its bi##est and costliest re*amp in the countr%, in line $ith
its #lobal strate#% of attractin# more adults&>or the ne3t
#eneration of consumers 'c"onald(s plans to culti*ate a *er%
different ima#e from its e3istin# one& ?fter re*ampin# 2<0
stores in
*arious mar)ets last %ear,
'c"onald:s is no$ optin# for
the 2ampa model and $ill
spread that desi#n to up$ards
of <00 locations this %ear L
rou#hl% triple $hat it did last
%ear& 2he compan% is donnin#
a ne$ loo) $hen India is on its
$a% of becomin# a #lobal
hotspot for food retailers, $ith
chains li)e Starbuc)s, Eur#er
Min# plannin# to enter the
countr%&Some 'cRemodel
hi#hli#hts include =
NRedoing roo#s - 2he
bri#ht red roofs that ha*e
topped 'c"onald:s for se*eral
decades are #ettin# the hea*e,
replaced $ith flatter, more
con*entional roofs&
NMuting paint - 2he neon
%ello$s and reds common to
the interiors and e3teriors are
becomin# histor%, replaced
$ith much more subtle
oran#es, reds, %ello$s and
e*en #reens&
N<pdating chairs - 2hose
industrial steel chairs are
#i*in# $a% to $ooden chairs,
colorful stools and, in some
cases, *in%lco*ered chairs that
resemble leather& Some stores
$ill ha*e lar#er loun#e chairs
similar to the )ind %ou mi#ht
e3pect to find in a coffee shop&
NDoubling dri$e-through
- 2o ease lines inside and
outside stores, man% locations
are addin# second dri*e
throu#h $indo$s to speed up
ser*ice&
NSplashing colour -
'c"onald:s hasn:t 4un)ed it:s
familiar red and %ello$ colors
alto#ether, but it is ma)in#
them far less ob*ious& Instead
of fillin# the restaurants $ith
them, it:s splashin# bri#ht
%ello$ and red here and there
for effect&
NDi$iding dining areas -
2he sea of tables and chairs is
histor% in the remodelled
stores& 2he ne$ dinin# rooms
are di*ided into separate eatin#
;ones for lar#er #roups, eat
andrun customers and fol)s
$ho $ant to sta% and loun#e&
N=dding #lat-screens 's
- Iar#e, flatscreen 2Vs L
some pla%in# contemporar%
music L are sho$in# up in
man% locations, thou#h fe$er
than half of the remodelled
stores $ill displa% them&
2he ne$ desi#n ma)es the
customer feel more
comfortable and at leisure to
en4o% their surroundin#s& 2his
offers to
'c"onald(s t$o )e%
opportunities firstl%, to shift to
another
www.ijsrp.org
International Journal of Scientific and Research Publications, Volume 2, Issue 9, September 2012 5
ISSN 2250!15!
customer base $ith hi#h spendin# po$er and then to broaden
their menu $ith offerin#s at a hi#her price point&
Ris)s In$ol$ed - Fhen a #lobal or#ani;ation li)e
'c"onalds is #oin# in for rebrandin#, a lot of financin# is
in*ol*ed and the #lobal impact is hu#e& 2hou#h the step ta)en
b% the mana#ers of 'c"onalds is $ell calculated but
speculations are on till the time it doesn(t fair $ell in the mar)et
and most importantl% to the customers& 2his )ind of rebrandin#
in the
Indian >ood Industr% can help chan#e the ima#e of 'c"onald(s
completel% li)e in the case of Pi;;a 0ut, $hich has become a
part of fine dinin# se#ment, $hich it $as not earlier& 2he Indian
consumer is considered to be lo%al but still the ris)s in*ol*ed
are hi#h&
1. = trade-o## bet>een >hat is e&pected #rom a
company and >hat a company has to gain #rom the
consumers -
9ne can see that one facet raises the scale $hile the other
$ei#hs it do$n ma)in# it a tou#h tas)& In order to sustain the
balance, it re1uires bi# in*estments $hich $ill surel% add to the
costs incurred in the rebrandin#& If the rebrandin# falls flat, it
$ill result in a ma4or profit decline&
2. Store positioning -
'c"onald(s needs to ha*e the most current information to
determine if present outlets are cannibali;in# each other(s
business& 2o achie*e this 'c"onald(s team $illneed
comprehensi*e, demo#raphic data of India alon# $ith both
theirs and competitors( outlets&
IV& ,9N,I@SI9N
2he tas) is mammoth as 'c"onald(s tries to )eep up in the
race for a piece of the #reat Indian pie & ?s per >orbes ,
'c"onald(s India operations contribute !0 7 to their sales
$hich is a considerable share& It mi#ht become imperati*e to
create a Point of "ifference to fi#ht it out in the Indian mar)et as
all fast food brands ha*e modelled themsel*es on local fla*ours
no$ , the latest bein# M>, $ith its OStreet$ise( menu& Fhile
'c"onald(s does ha*e the ed#e $ith its e3cellent suppl% chain
and distribution net$or) the customer ultimatel% does become
the )in# $ith lo$ brand lo%alt% in this cate#or% bein# the
#eneralisation & 2he rebrandin# effort on their part see)s to brin#
in a ne$ fla*our to their brand
offerin# but $hat remains to be
seen is $hether the% are still
able to stri)e a chord $ith the
customer&
?,MN9F
I8"H8'8
N2
Fe $ould li)e to e3press
our heartfelt #ratitude to the
people $ho assisted us in this
endea*our of ours& >irst and
foremost , $e $ould li)e to
than) 'r& Pra*een Hupta,
09" , Ial Eahadur Shastri
Institute of 'ana#ement for
his *aluable time and support&
?lso, a special mention to the
staff of 'c"onald(s
Jor Ea#h, "elhi $ho $as *er%
patient and helpful durin# our
*isits to the outlet for the
stud%&
R8>
8R8
N,8
S
[1] Io*eloc),Firt; and ,hatter4ee ,
Ser*ices 'ar)etin# A , in
Plastics ,Si3th
8dition ,India , Pearson , 2010 ,
pp& DD9< , pp& !B0!C2
[2] ?a)er, "&?& -200Bb/,
AIe*era#in# the ,orporate
Erand , ,alifornia 'ana#ement
Re*ie$, BD -!/, pp& D1<
[3] Ei4oor, 0&, A? 2ime to
Rebuild , Eusiness India,
>ebruar% 20,2011 pp& B<&
[4] 0atch, '&J& and Schult;,
AErin#in# the ,orporation into
,orporate Erandin# A , 8uropean
Journal of 'ar)etin#, 200!, !C
-CG</, pp&10B110DB&
[5] Jac1uelline, E& and Mline,S
,A>rom 'cIibel to 'cIettuce=
,hildhood, Spin and Re
brandin# ,200C , Societ% and
Eusiness Re*ie$, 2-1/
?@
20
9R
S
First =uthor P Sameer ,
E&8n#inerrin# -,S8/,
II'?2-'"@ Rohta)/J
currentl% pursuin# PH"'
$ith ma4ors in 'ar)etin#
from Ial Eahadur Shastri
Institute of 'ana#ement,
sameer009D2Q#mail&com
Second =uthor P Sharanbir
Maur , E&2ech -,S8/ ,
HHSIP@ Jcurrentl%
pursuin# PH"' $ith
ma4ors in 'ar)etin# from
Ial Eahadur Shastri
Institute of 'ana#ement,
sharanbir)aurQ#mail&com
Correspondence =uthor P
Sameer
,sameer009D2Q#mail&com ,
9C1111!501
www.i
jsrp.o
rg