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1、McDonalds Global Strategy,Group OneNov.2,2009,BennyM987Z219,NadiaM987Z250,RachelM987Z226,SonnyM987Z261,ChristinaM987Z237,FebbyM987Z248,Huy,McDonalds Global Strategy,Brief History of McDonalds,The first McDonalds was built in 1940 by the McDonald brothers(Dick and Mac).Started off as a hot dog stand
2、in CA 1937The McDonald brothers realized that hamburgers were their most profitable menu item,and changed their business to serve a limited menu.Employing“car hops”the McDonald brothers became the first restaurant to offer speedy service to people while they stayed in their cars.,McDonalds Global St
3、rategy,Ray Kroc discovers McDonalds 1954 Kroc became the first franchisee appointed by Mac and Dick McDonald in San Bernardino,California.,McDonalds Global Strategy,In 1955,Ray Kroc opened his first restaurant in Des Plaines,Illinois(near Chicago),and the McDonalds Corporation was created.,McDonalds
4、 Global Strategy,McDonalds has over 30,000 local restaurants in more than 120 countries 70 percent of our restaurants worldwide are owned and operated by independent,local businessmen and businesswomenMcDonalds serves nearly 50 million customers each dayMcDonalds has its own Hamburger University in
5、Illinois,and the first batch graduated in 196112 classes offered at Hamburger University are college accreditedIn 1963,McDonalds sold its one billionth hamburgerMcDonalds is listed on the New York,Frankfurt,Munich,Paris and Tokyo stock exchanges,McDonalds Global Strategy,The first McDonalds Drive-Th
6、ru opened in Sierra Vista,Arizona in 1975Happy Meals were added to McDonalds menu in 1979McDonalds launched the new worldwide Balanced Active Lifestyles public awareness campaign in 2005McDonalds celebrated its 50th Anniversary on April 15,2005,McDonalds Global Strategy,1971 McDonalds really starts
7、going globalAsian:Tokyo Ginza District,JapanEuropean:Netherland,Munich,Germany1967-Canada&Puerto Rico(first restaurants outside the U.S.)1971-Tokyo,Japan,Amsterdam,Netherlands&Sydney,Australia 1979-Rio de Janeiro,Brazil1990-Moscow,Russia&China,McDonalds Global Strategy,McDonalds,still the dominant p
8、layer in the fast food restaurant business,is being challenged by Subway,a smaller company that has been rapidly expanding since 1965.,McDonalds Global Strategy,Founded by Fred DeLuca in 1965.Subway is one of the fastest growing franchises in the world with approximately 31,949 restaurants in 91 cou
9、ntries as of November.,McDonalds Global Strategy,Many restaurant analysts attribute Subways fast growth to the growing health concerns by restaurant customers,a trend that Subway has taken advantage of in its marketing.,McDonalds Global Strategy,Subway,riding high on the marketing message of healthy
10、 fast food,will overtake McDonalds in American store locations by the end of 2009,with a shocking total of more than 32,300 outlets.Thats something few consumers could imagine before the sandwich chain piggybacked on huge weight loss of Jared Fogle-who lost 245 pounds by exercising and eating only i
11、ts sandwiches,in contrast to Super Size Mes Morgan Spurlock,who got fat and sick eating McDonalds food.In the process,Subway has managed to expand its business and profits.Now,Subway has emerged as a healthy alternative in the market place,partially because its modest business model allows it to ope
12、n businesses in smaller locations that cannot sustain stand-alone restaurants like McDonalds,which depend heavily on drive-through business for its earnings.,McDonalds Global Strategy,PEST Analysis,To analyze the current status of McDonalds corporation,we chose to use the PEST method to evaluate the
13、 following categories P Political E Economic S Social T Technological,Political Challenges,Health and Safety GuidelinesThe director of the obesity program for the Childrens Hospital Boston,David Ludwig,claims that fast food consumption has been shown to increase calorie intake,promote weight gain,an
14、d elevate risk for diabetesCenter for Science in the Public Interest,a long-time fast food critic over issues such as caloric content,trans fats and portion sizes,Political Challenges,Ecological/environmental issueFast food industry giants such as Wendys,Pizza Hut,and McDonalds are some of the large
15、st consumers of paper products in the US.Every year millions of pounds of food packaging waste litter our roadways,clog our landfills and spoil our quality of life.Home market pressure-groups International pressure-groups Pushing for increased regulations to make companies more responsible,Political
16、 Challenges,Wars and conflicts war between countries where the company operates.They have also become a symbol of capitalism and Americanism meaning that they have now become the target of terrorist group and attack.,Economic Challenges,McDonalds must consider economic challenges when expanding inte
17、rnationally.Low set up costs=rapid expansionOne of the challenge for fast food industry is that to keep the price is low for the customer.Franchising facilitates set upsMcDonalds corporation provides financing assistance and training for new franchise owners to manage cash flow and keep businesses p
18、rofitable.,Social Challenges,From the research plan McDonalds profits dropped from$1.977 million dollars 2000 to$893 million dollars in 2002.The main reason is the consumers worries had greatly increased with health fears of increasing obesity so customers now opted for more healthier options like s
19、ubway which offered more of a variety for health conscious customers.,Social Considerations,To ease customers concern about health issues,McDonalds has made changes to the following;,McDonalds changed its image vastly by evaluating the current menu and making changes to it from using organic product
20、s to revising the whole menu entirely by offering salads and vegetarian burgers.McDonalds serves a range of high-quality foods that can fit into a balanced diet.The accurate and accessible nutrition information help guests make informed menu choices.,Social Considerations,Emphasis on food safety:,Mc
21、donalds suppliers have food safety management systems in place,including Good Manufacturing Practices(GMP),a verified Hazard Analysis Critical Control Point(HACCP)plan and crisis management,food security and other applicable programs,Technological Advantages,McDonalds has taken advantage of technolo
22、gy to streamline their processes and improve efficiency.,Through technology enhancements such as FPIs Help Desk Service,network and application consolidation,and other technology implementations,operations of the company are greatly improved.,Technological Advantages,Touch Order Allows You To Place
23、Order At McDonalds Via Handset,Technological Advantages,The customers can place their order directly from their tables,dubbed as“Touch Order”.Its the first self-ordering system in the world to use RFID*,Technology Spotlight:McDonalds tests Speedpass cashless payment system,Technological Advantages,M
24、cDonalds has also implemented technology to improve supply chain management,and allows customers to access this information to make more informed decisions about what they eat.,Strategy recommendations,Recommendations for McDonalds,More Healthy ChoicesMcDonalds should develop menu choices that are h
25、ealthy and socially acceptable.It is possible to develop a menu that people will enjoy and that also fits into the original“Speedy Service”model the company introduced in the 1950s.Use local food sources where possible.Using local sources decreases the time to market,and also decreases the use of fu
26、el to transport goods.,Recommendations,Locally focused menu choicesMcDonalds in India has specific menu itemsFor the vegetarian market;,Recommendations,Increase presence in Asian countries,McDonalds has most certainly had a profound effect on China.When the first McDonalds opened in Beijing more tha
27、n a dozen years ago,40,000 people lined up to observe a Big Mac and get their picture taken with the infamous Ronald McDonald.McDonalds is growing faster in China than in the United States.McDonalds owns&operates more than 600 stores across 105 cities in China.More than 100 more McDonalds stores wil
28、l be added annually to Chinese cities within the coming years.,Recommendations,While offering the basic burger and fries,McDonalds in China also offers:Szechuan-style spicy chicken wingsSeafood SoupRiceOriental SaucesTaro and Red Bean Dessert,Discussion Questions,What do you consider to be the defin
29、ition of globalization?What forces are driving its development?,An ongoing process by which regional economies,societies,and cultures have become integrated through a globe-spanning network of communication and exchange.The forces driving it are:Economic,Technological,Socio-cultural,Political,and Bi
30、ological,Discussion Questions,Identify the reasons why global strategies sometimes fail in their objective to achieve a global marketing advantage.,Lack of understanding about local culturesUnaware of current issuesCannot compete with global competitors,Discussion Questions,Companies that has failed
31、 doing global strategies:,Coca-cola has been banned by Venezuela,because the company didnt declare the use of“harmful”sweetener.Imports of beef from Brazil has banned by several countries,due to the outbreak of a foot-and-mouth disease.French,Denmark and Norway have banned Red Bull because of its hi
32、gh levels caffeine and other stimulants.,Discussion Questions,What is the rationale behind mega mergers and major acquisitions?How will they lead to global competitive advantage?,Mega mergers have the effect of reducing cost and complexity of doing business in other countries.To try and establish a
33、business from the ground up in another country,you can face many challenges;political,social,and economic.Often,the best choice is to simply buy a similar company and reduce overlap where possible.Competitive advantage can be realized when merging with a successful company in a similar business.,Dis
34、cussion Questions,What are the critical success factors in developing a global brand?What additional factors would you consider to be necessary in developing a successful global e-business brand?,A global brand must be“universal”in that it appeals to basic human wants and needs without being specifi
35、c to a country or culture.Some exceptions exist,but in our opinion,a successful global brand needs to be identifiable without identifying where it originated from.For an e-business,a company must display value to all consumers.Example:E-bay,Discussion Questions,What are the main challenges that are
36、faced by international managers in managing and controlling a global marketing strategy?What advice would you give to a manager with this responsibility?,Global marketing strategies require in-depth knowledge of the communities they are trying to reach.The better the understanding of the demographic
37、s of the market,the better chance you have of understanding their specific wants and needs.Advice:Get local help!You cannot expect to do this from a distance using Google.Find people you can trust in the area and utilize their knowledge and connections.,Conclusion,McDonalds should continue to expand
38、 internationally,but be mindful of the local dietary needs and desire of people to eat a healthy balanced diet.,The competition from Subway is important to consider,but there is still a large gap between store earnings.McDonalds stores earn around$2 Million each,while Subway stores earn around$445,0
39、00.As people begin to understand that the“healthy”alternative offered at Subway can be had at McDonalds,there are few reasons to go elsewhere.,Questions for the Class,Do you feel that McDonalds food is unhealthy and toxic,or is it more like a treat to be enjoyed on occasion?,Questions for the Class,Is there anything specific you would like to see added to the McDonalds menu in your countries to appeal to your specific tastes?,Questions for the Class,With the current“Mad Cow”scare,are you more afraid of eating beef?,Thank You!,
