SERVICES MARKETING

CONTENTS
ABOUT McDONALDS
McDONALDS BUSINESS MODEL
SUSTAINABILITY OF McDONALDS
7PS OF McDONALDS
SWOT ANALYSIS OF McDONALDS

ABOUT McDONALDS
The McDonalds family moved from Manchester, New Hampshire to Hollywood in the late 1930s, where brothers
Richard and Maurice McDonalds began working as set movers and handymen at Motion-Picture studios.
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.
MCDONALDS NOW OPERATE IN 119 COUNTRIES
MCDONALDS AMBITION
GOOD FOOD
GOOD PEOPLE
GOOD NEIGHBOR

McDONALDS BUSINESS MODEL

The power of McDonalds franchisees, suppliers and employees working together toward a
common goal is what makes McDonalds the worlds leading quick-service restaurant brand.
Franchisees bring the spirit of entrepreneurship and commitment to communities.
Suppliers are dedicated to highest levels of quality and safety.

While a global Brand, the vast majority of McDonalds restaurants more than 80% worldwide
and nearly 90% in the U.S. are owned and operated by approximately 5,000 independent, smalland mid-sized businessmen and women.
McDonalds pay special attention to how customers are alike and how they are different too. For
that reason, markets and countries have latitude when it comes to menu, marketing, community
involvement and local business management.

SUSTAINABILITY OF MCDONALDS
In 2013, McDonald's developed a Global Sustainability Framework with five focus areas
or pillars - food, sourcing, planet, people and community. They set measurable, specific
goals for some of these pillars to advance what they call Our Journey Together. For
Good.
Good Food: At McDonalds, Good Food means great taste, modern choices and real
ingredients.
Good Sourcing: McDonalds journey toward sustainable sourcing begins with there
direct suppliers and extends to a complex network of indirect suppliers that source
ingredients for there menu items.

SUSTAINABILITY OF MCDONALDS
Good planet: The Company and its Franchisees are seeking new ways to further improve
restaurant efficiency, manage energy usage and costs, recycle waste and conserve and reuse water,
all while engaging there people and customers to strengthen the business and brand.
Good People: At McDonalds, people are the face of Brand. We know McDonalds can make a
positive impact in the lives of many by providing opportunity through training and education.
Good Communities: McDonalds Founder Ray Kroc used to say, We have an obligation to give
something back to the community that gives so much to us. Today, McDonalds remains
committed to being a good neighbor in thousands of local communities where McDonalds
restaurants operate.

7PS OF MCDONALDS
1. Product
The product offered is a standard set of items that are similar in taste and appearance wherever in the world
they are being sold. There is some adaptation according to local tastes and laws. For example, a more
vegetarian menu is offered in India, where a majority does not eat meat. In Muslim countries, any pork
products are eliminated and halal meat is used.
2. Price
The organization attempts to price differently across its operations. This means that the right price is selected
for the right market. Pricing decisions are made by setting a pricing objective, determining demand, estimating
costs, analyzing competing offers, deciding on a pricing method and then finalizing a price.
3. Place
McDonalds has presence in 119 countries of the world. The organization believes in strategic expansion that
focuses on a locations long term potential.
4. Promotion
By first understanding cultural differences, a localized promotion strategy is employed. The focus is on both
the brands global image and its local sensitivity.

7PS OF MCDONALDS
5. Process
In all of the thousands on McDonalds worldwide, the same process is used for making the food. The food specifications
for size, weight and content are the same everywhere. All suppliers need to meet these specifications. Kitchen and
restaurant layouts are the same. To cater to language differences, the menu displays contain images that help create
similarities everywhere.
6. People
The company staffs locally and also promotes from within. This allows the team managing the operations to understand
local cultures as well as the corporate philosophy. The people chosen are trained in both technical skills and customer
focus.
7. Physical Evidence
All McDonalds locations are similarly created with a family friendly environment. There is a play area for children, and
service is always provided with a smile. All menus are structured in similar ways with fries and drink combos. The
childrens meal always has toys. These are all elements of physical evidence that are standard in all Mcdonalds locations.

SWOT ANALYSIS OF MCDONALDS

STRENGTH
Brand Equityworld-wide
42% of US fast-food hamburger business
Consistency of food
Successful items: Fries, Happy Meal, Big Mac, Egg McMuffin, Promotions
Overseas market
Balance sheet position
WEAKNESS
Declining market share
Weak product development
Disgruntled franchisees
Quality and taste of products
Slowed revenue and income growth

SWOT ANALYSIS OF MCDONALDS

OPPORTUNITY
International expansion
Only serving 1% of the worlds population
Growing dining-out market
Joint ventures with retailers (e.g. supermarkets).
Consolidation of retailers likely, so better locations for franchisees.
Strengthen its value proposition and offering, to encourage customers who visit coffee shops into
McDonalds.
THREATS
Mature/overstored industry
Strength of competition
More health-conscious consumers
Changing demographics
Fluctuation of foreign exchange rates; Economies
Recession or down turn in economy may affect the retailer sales