125901742 why mcdonalds is successful in india

7/28/2019 125901742 Why McDonalds is Successful in India

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INDEX OF TABLES


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PROBLEM STATEMENT To identify the key success factors of McDonalds in India.


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RESEARCH OBJECTIVE To understand the various strategies employed by Mc Donalds tocompete with the well-established Local Fast Food market and analyze the differences in the consumption pattern of a family and their preferences.


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Literature Review About the Success of McDonalds in India

McDonalds has become not only the largest fast food restaurant organization, buthas come to symbolize globalization itself as it has literally changed eating habits around the world. It commands the leading share (42%) of the U.S. fast foodmarket and runs more than 28,000 restaurants in 120 countries. Each day, abouteight percent of the U.S. population will eat a meal at McDonalds, and each year,ninety six percent of the U.S. population will eat at a McDonalds. By 1988 McDonalds had opened 10,000 restaurants in just 33 years. It was then able to reach the 20,000 mark in another 8 years. By 1997 McDonalds was opening 2,000 restaurantsper year an average of one every five hours. McDonalds serves less than one percent of the global market per day and sees the opportunity to continue growth into the next century. McDonalds is the world s largest food service system with more than 30,000 restaurants in 100 countries, serving more than 46 million customers every day. McDonald s opened its doors in India in October 1996. Ever sincethen, their family restaurants in Mumbai, Delhi, Pune, Ahmedabad, Vadodara, Ludhiana, Jaipur, Noida Faridabad, Doraha, Manesar and Gurgaon have proceeded to demonstrate, much to the delight of all the customers, what the McDonald

s experience is all about. Their first restaurant opened on 15th April 1955 in Des Plaines, Illinois, U.S.A.


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Locally Owned McDonalds in India is a 50-50 joint venture partnership between McDonalds Corporation [USA] and two Indian businessmen. Amit Jatias company Hardcastle Restaurants Pvt. Ltd. owns and operates McDonald s restaurants in Theystern India. While Connaught Plaza Restaurants Pvt. Ltd headed by Vikram Bakshi owns andoperates the Northern operations. Amit Jatia and Vikram Bakshi are like-mindedvisionaries who share McDonald

s complete commitment to Quality, Service, Cleanliness and Value (QSC&V). Having signed their joint-venture agreements with McDonald

s in April 1995, they trained extensively, along with their Indian management team, in McDonald s restaurants in Indonesia and the U.S.A. before opening thefirst McDonalds restaurant in India. Respect for local culture McDonalds is so successful in India because of its respect for local culture. McDonald s India has developed a special menu with vegetarian selections to suit Indian tastes andpreferences. McDonald s does not offer any beef or pork items in India. Only thefreshest chicken, fish and vegetable products find their way into their Indianrestaurants. In addition, theyve re-formulated some of their products using spices favtheired by Indians. Among these are McVeggie burger, McAloo Tikka burger, Veg. Pizza McPuff and Chicken McGrill burger. They ve also created eggless sandwich sauces for their vegetarian customers. Even their soft serves and McShakes are egg-less, offering a larger variety to their vegetarian consumers.


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International Standards McDonald s India s local suppliers provide us with the highest quality, freshest ingredients. Complete adherence to the Indian Government regulations on food, health and hygiene is ensured, while maintaining their own recognized international standards. Fast, friendly service - the hallmark of McDonald s restaurants the world over is the mantra they abide by. Stringent cleaning standards ensure that all tables, chairs, highchairs and trays are sanitized several times each hour. Such meticulous attention to cleanliness extends beyond the lobby and kitchen to even the pavement and immediate areas outside the restaurant. McDonalds Philosophy "They take the burger business more seriously than anyone else." Principles followed by McDonalds to be successful in India Quality, Service, Cleanliness & Value - It is an unflinching McDonald s ideology thattheir customers must always get quality products, served quickly and with a smile, in a clean and pleasant environment; and all at a fair price They are committed to exceeding their customers

expectations in every restaurant every time. They have a passion and a responsibility for enhancing and protecting the McDonald

s brand. They believe in a collaborative management approach, employing a mutually respectful business philosophy,


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They will seize every opportunity to innovate and lead the industry on behalf oftheir customers.

Evolution of McDonalds Richard and Maurice McDonald originally founded McDonaldsin the 1930s, but its success is due to the efforts of Ray Kroc, who put the hamburger on the assembly line. Each workers steps were calculated in order to ensure maximum efficiency. The result was a decrease in preparation time and an increase in volume, allowing for cheap prices and fast service. The restaurant chaingrew slowly at first. Kroc decided to build all of the restaurants and then franchise them out in order to have uniformity. He later founded the Hamburger University in 1961 in order to train franchisees and corporate decision-makers. Hamburger Universities were later founded in Tokyo, Munich, and London. He built primarily in the suburbs as suburban America was just developing in the 1950s after WWII. The popularization of the automobile also increased McDonalds popularity andthroughout the 1960s and 70s the chain grew incredibly quickly. In 1973 McDonaldsfirst opened for breakfast with the creation of the Egg McMuffin. By 1987 one fourth of breakfasts eaten outside the home in the United States came from McDonalds. In 1975 McDonalds pioneered its first drive-thru window; drive-thru sales eventually accounted for more than half of McDonalds system wide sales. In the 1970scompetition with other fast food chains intensified, culminating in the "BurgerWars" of the early 1980s. In order to cater to changing consumer preferences, McDonalds introduced Chicken McNuggets in 1983 and by the end of the year, McDonaldswas the second largest retailer of chicken in the world.


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However, due to a series of difficulties including failed marketing strategies and new sandwiches that flopped, growth in the U.S. slowed during the 1990s. Overseas, the 1990s saw an increase in international units from 3,600 in 1991 to more than 11,000 by 1998, largely in Japan, Canada, Germany, Great Britain, Australia, and France. The number of overall countries with McDonalds nearly doubled from 59 in 1991 to 114 in 1998. In 1993 McDonalds first expanded in to the Middle East and opened in Tel Aviv, Israel. As the company entered new markets, it showed flexibility with respect to the local preferences: in Germany, McDonalds serves beer with meals; in Israel, the first kosher McDonalds opened in Jerusalem in 1995; in Arab countries, the restaurant chain used Halal menus; in 1996 McDonaldsentered India where they offered the Maharaja Mac, made with lamb rather than beef; in Sweden, the first McSki-thru opened in Lindvallen, Sweden. McDonalds ubiquity has made it a lightning rod for criticism from numerous fronts. Vegetariangroups, farmers, university students, labor groups, and groups from practicallyevery foreign country have attacked McDonalds for damaging peoples health with bad food, using produce from huge factory farms, invading college student centers,using toys made in sweatshops, being the front-man for economic globalization,and every kind of global cultural hegemony.

Potato Farming In Gujarat McDonald

s India, even prior to its entry into India,was committed to working with local suppliers and farmers to source all its requirements. The company therefore spent 6 years and around Rs. 450 crore to set upthe food supply chain even before opening its first restaurant in the country.


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India, despite being the worlds second largest producer of food, loses nearly Rs.50,000 crore worth of food produce due to wastage at various levels, especiallydue to lack of proper infrastructure for storage and transportation. McDonald sIndia has pioneered the cold chain management system wherein the freshness, crispness and nutritional value of vegetables and processed products are retained. In 1991, McDonald

s was looking for a particular variety of potato for manufacturing its world famous French fries. One of McDonalds suppliers Lamb Weston invested heavily in setting up production lines to process these potatoes and make thefries. However, production was discontinued, as the right quality of potatoes could not be sourced. The right quality potato in India was unavailable as farmersused seeds from the preceding crop, which in turn resulted in a single varietyand poor quality potatoes. McDonalds needed the process-grade variety of potato for its products, which are as per McDonald s international quality standards. The variety of potato required by McDonalds had to have a certain length, high solids content and low moisture content while the ones that were available were of the table-grade variety. Nonetheless, as per its initial commitment to local sourcing, McDonald s and its supplier partner, McCain Foods Pvt. Ltd., began to workclosely with farmers in Gujarat and Maharashtra to develop process-grade potatovarieties. McCain Foods Pvt. Ltd. is the worlds largest French Fry Company in the world. Established in 1957, today it is a brand that is known and respected inmore than 100 countries, generating worldwide sales of more than $5.5 billion.It has more than 55 processing plants on 4 continents (29 of which are French fry and potato specialty facilities) and exports to more than 80 countries worldwide. Leaders in agronomy, technology and innovation, McCain Foods Pvt. Ltd. partn

ered with McDonalds to work with farmers in Gujarat (specifically the towns


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of Deesa and Kheda) to interact with agronomists and field assistants to demonstrate the best practices right from better agronomy techniques like irrigation system, sowing seed treatments, planting methods, fertilizer application programmes and better storage methods for the produce. In addition to this, the farmers also benefit through incremental monetary gains as they sell directly to McDonalds. Everyday Value At McDonalds Outlets in India McDonald

s India is an employer of opportunity, providing quality employment and long-term careers to the Indianpeople. The average McDonald

s restaurant employs more than 100 people in 25 different positions from cashier to restaurant manager. McDonald s world class-training inputs to its employees can be seen in the present close to 2000 employeescurrently in Mumbai and Delhi. Manpower Planning: The Scheduling Manager is in charge of the manpower planning in the outlet. They have full timers who work for9 hours and part timers who work for 3-4 hours. If they expect more customers (during holidays etc) then more part timers are recruited. Recruitment: Done by reference of the employees in the outlet or other outlets. Training and Development: Training is a continuous process at the McDonalds. It is the responsibilityof the training squad to train the other employees. The training squads maintaintraining logs of the employees, which clearly states that which employee is tobe trained, and on what station. The 3/30 Plan: According to this plan, the training squad has to train 3 people on three different stations in a month. One employee is trained on one station, say the vegetarian station for 10 days, and then for the nonvegetarian station for the next 10 days and so on. This is done till the


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employee becomes proficient on the station and is capable of handling the station on his own.

Performance Appraisal: Every employee joins in as a Trainee Crew where he is given the Green Badge. After a period of 3 months, the employee is checked for thehealth safety, cleanliness and sanitation after which he is given the Yellow Badge. After receiving the Yellow Badge, there are 5 stations that the employee hasto be proficient in: 1. Backroom Cleaning This includes mopping the floors, clearing the tables, maintenance of the machines etc. 2. Fried Products This involves frying of the French Fries, Pizza Puff etc. to the right degree. 3. Buns, Dress and Grill (BDG) This includes grilling the bun and dressing them properly. There is a time limit given to perform every function and the employee has to perform it efficiently, with minimum wastage. 4. Counter The last station is of thecounter handling. The employee should be able to converse with the customers courteously and take proper orders. 5. Personality The last criteria is the overallpersonality of the employee. McDonalds being in the service industry, having smart and courteous employees is of utmost importance to them. The productivity record has to show 90+ points. The productivity is various ways. For example McDonalds has a policy if

checked in

serving each customer within one minute on an average. The productivity at the counter is checked by the time taken by an employee to complete


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the order. For E.g.: If Freda (A service-counter in charge) has taken 2.5 minutes on a average to serve each customer in her shift, at the end of the shift, theshit running manager will speak to her and ask her the reason and accordingly ask her to try and improve. If this trend continues, Freda is trained further. After the productivity record shows 90+ points, the employees have

to appear for a documented written test where they must get more than 90 marks.Having got a 90+ average of the two, the employee is promoted to

the next hierarchy level. McDonald

s worldwide stand for QSC&V, where V stands forvalue and therefore the value proposition assumes special significance. Explaining this, Mr. Amit Jatia, Managing Director, McDonald

s Western India says, McDonald s success has been built on commitment to the delivery of QSC&V (Quality, Service, Cleanliness and Value) to customers, the expansion of restaurant numbersto improve convenience and large scale investment in supplier development, training and people. Getting QS&C consistently, and overwhelming appreciation of Value keeps our customers satisfied and maintains our competitive edge. The value initiative at McDonald

s is all-pervasive. Our strategy is to achieve best value byenhancing experience (offering best quality), while keeping prices reasonable.This applies to products we serve our customers and to every other aspect of the

way we do business. At McDonald

s, costs are kept low by increasing efficiencyand cutting wastage at all levels. This is possible by advanced operations, management and human behavior skills tested over time in around 120 countries acrossthe world. It is important to understand that delivering highest quality doesntcome easily. Customers, who walk into a McDonald s restaurant, expect to be served food that is hot and fresh, made from the highest quality ingredients, servedwithin minutes of placing their


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order and at a price, which is affordable. Such is the strength of the brand that they rely on McDonald

s to do all this, without thinking about how it is actually achieved. This is achieved through to the minutest details and doing thingsthe right way, whether it is the McDonald s unique cold chain network which ensures that food products move from farms to restaurants absolutely fresh, at the lowest possible cost, or, the reverse osmosis water treatment plant at every restaurant to provide water which is the ultimate in purity, McDonald s in India hasinvested heavily in achieving quality.

McDonalds Value offers Though all McDonald

s food products offer tremendous value, we continually review and improve our menu offerings to make sure that we notonly meet our customers expectations, but also exceed them. As a result, we haveintroduced a series of ongoing value options to enable our customers to appreciate this aspect of the brand even more strongly. McDonalds Advertising StrategiesDDB Needham and Leo Burnett are the advertising agencies of McDonalds worldwide.Hence, when they came to India, the subsidiaries of both the companies pitchedfor the account and Mudra, the Indian partner of DDB Needham got the account. Since the very beginning Mudra has been the advertising agency of McDonalds India. The Mudra team meets up with McDonalds marketing team on a regular basis and they have a debate and discussion on the new strategies to be adopted.


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McDonalds uses various medias like television, hoardings and bus shelters. They are almost out of print ads. McDonalds also sponsor many television programmes like Kaun Banega Crorepati, Children shows etc. Even the paper mats on the trays atthe McDonalds are designed as per the ongoing marketing strategy of McDonalds. For e.g.: During the French fries issue, all their paper mats had description of the burgers, how the vegetarian products are made etc, to regain the confidence of the customers.

The placing of the pamphlets, banners in and around the outlet is decided upon by the Area Sales Manager and the Operations Manager, in co-ordination with the Restaurant Manager. For e.g.: Currently they have the Bugs Life Theme going on wherein they give free Bugs Life toys with the Happy Meal. All the outlets are decorated with the pictures of the toys and even the paper mats have pictures of the toys on them. The hoardings around the outlets carry the same theme. Even themenu counters in the outlet are a marketing tool for the company. They have to be designed such that they catch the attention of the customer and tempt him to order the product. So McDonalds have menu boards that are descriptive as well as visual. They call it the 80-20-menu board-eighty percent visual and twenty percent descriptive. The aim is to make things easier for the customer to understand what the 39, 49, 59, 79, 89 rupee options are. And of course it is easier for McDonalds also to give back the one rupee change so that the service can be quick. The marketing strategy of McDonalds in India has gone through mainly 3 stages: Stge I: Building the Brand Stage II: Awareness of the products Stage III: Gunningfor market share.


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Stage I: Building the Brand The Stage Fright Advertisement (We make you smile!)The initial marketing strategy was focused on building the brand name in India.McDonalds wanted to bring an awareness of its presence, of the arrival of McDonalds in India. Hence, even thought it had presence only in 2 cities, Delhi and Mumbai, it still went in for Nationwide Advertising. The first advertisement of McDonalds in India was of a child getting tensed in a Fancy dress competition and forgetting his lines. His father then takes him to McDonalds where he forgets all his fears and gives a brilliant performance appreciated by all in the restaurant.Every child in India could relate itself to the child in the advertisement and it gave the parents the idea that if their child were unhappy, taking him to McDonalds would definitely bring a smile to his face. When Vikram Bakshi was asked how the idea for the first advertisement came up, his reply was: The idea came fromthe experiences of what we saw happening at the restaurants. I think one of thethings that recent research has shown is that 69 percent of the kids prefer us.That kind of response is overwhelming! We have seen over a period of time thatsome of the things we set out to do in 1997-98 are paying off now. Really the kids are very happy to be here. They find it a hassle free experience. Nobody to say, "Sit down!" or "Don

t move!" He is no longer told that if he runs around hewill bang into someone and spill things over. He doesn t encounter adults all the time like he does in specialty restaurantswaiters who are in their thirties and forties, with faces which say, "Keep out of my way!" What he sees when he comes into McDonalds is a place that is brightly litthere are no dark corners that he needs to be scared of. The people working here are all young. He can walk up alone to the counter and ask for whatever he wants, someone will talk to him, tak

e him seriously, look after him, ask him


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questions. He has a play area where he can run around. And clearly even parentsare happy to bring their children here. I have seen many instances where parentscome in with their children; they are playing while the parents are also enjoying themselves. There was this lady I met and she asked me, "What is this that you do to children?" So I said, "What do we do meaning?" She said, "My two year-old recognizes McDonalds. When I took her to Wimpy

s the other day she refused toenter the place, saying it was not McDonalds."

Stage II: Awareness of the Products McDonalds then felt that it needed to highlight its products along with the experience. Hence, came the series of advertisements highlighting on the products and new launches of McDonalds. McDonalds wanted the customers to know that they have something for everybody, be it children or adults, vegetarian or non-vegetarian. The advertisements in these series were: The Sleeping Couple: In the sleeping couple advertisement the husband is shown dreaming about the various products of McDonalds. Anyone watching the advertisementsfelt like going to McDonalds right away. The Police and Thief: The thief is on arun from the police but makes a stop at McDonalds to have the new McPizza Puff and the Chicken McGrill. The Barber and the Customer: The customer is getting himself shaved when he hears about the launch of McPizza Puff and Chicken McGrill,and runs to the nearest McDonalds half shaved.


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The Runaway Bridegroom: A couple is getting married when the Bridegroom runs away in the middle of the marriage to have the new McPizza Puff and the Chicken McGrill and the whole family follows him. Veg Surprise: The latest commercials, around 3 of them, are focused on the launch of the new Veg Surprise for Rs.17 onlywith the punch line Yakein hi nahin hota.

Stage III: Gunning for market share The latest advertisements of McDonalds are atransition from the first strategy. In the initial advertisements, McDonalds wasattempting to build a relationship with the customers. But now, the advertisements portray that the relationship has already been established. Its got the mindshare, and its now gunning for market share.

The ad campaigns are trying to portray McDonalds as a constant companion, which makes people feel special. The recent commercial highlights the bond that McDonalds shares with people. It shows a child moving to a new locality, and he is sad.But when he sees McDonalds in his neighborhood, the child is once again reassured. The recent ad campaign is targeting the Indian is targeting the Indian father,as he is still looked upon as a decision-maker. The new positioning: McDonalds is a special place where caring dads take their families to give them a great time. So its a clear positioning as a family restaurant. We are positioning ourselvesas the welcoming and affordable family restaurant committed to values of quality, fun and excitement. It is also a restaurant which makes you feel special andmakes you smile, says Amit Jatia.


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Miscellaneous Advertisements There were many other advertisements made by McDonalds emphasizing on the schemes, the prices and various other aspects. Some of them were: The Itch Karo Scheme: This advertisement was to promote the scheme of McDonalds wherein you could win prizes right from a small Cadbury to a television andbike. Soft Serve Cone: There were many advertisements focusing on the Rs.7 softserve cone. One of them was of a traffic policeman who gets tired of directingthe customers to the McDonalds outlet. This advertisement if of the most liked and remembered advertisements of McDonalds. Happy Meal: There are various advertisements relayed during children programmes on television and also children channels emphasizing on the happy meals and the toys you get with them.

McDonalds India has undertaken many social activities like: Supporting Health drives like Pulse Polio since 1998. McDonalds Spotlight, an inter-school performingarts competition started in 1998 for schools all over Mumbai and Navi Mumbai toprovide the students with an atmosphere for healthy competition. Over 120 schools participated in 1998,1999 and 2000. McDonalds has tied up with Nehru Science Centre, Mumbai (NSCM) in 2000 for a period of three years to bring the students ofMumbai a


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science quiz. This quiz has been conducted by NSCM for the past ten years. WithMcDonalds, it hopes to get the contest to a new level. Having cleanliness driveswith the BMC like the one on 15th August 1997 for making Mumbai garbage free andjoined in celebrating 50 years in Indias independence. Outlets in India McDonald

s India is an employer of opportunity, providing quality employment and long-term careers to the Indian people. The average McDonald

s restaurant employs morethan 100 people in 25 different positions from cashier to restaurant manager. McDonald

s world class-training inputs to its employees can be seen in the presentclose to 2000 employees currently in Mumbai and Delhi. Manpower Planning: The Scheduling Manager is in charge of the manpower planning in the outlet. They havefull timers who work for 9 hours and part timers who work for 3-4 hours. If they expect more customers (during holidays etc) then more part timers are recruited. Recruitment: Done by reference of the employees in the outlet or other outlets. Training and development: Training is a continuous process at the McDonalds.It is the responsibility of the training squad to train the other employees. Thetraining squads maintain training logs of the employees, which clearly states that which employee is to be trained, and on what station. The 3/30 Plan: According to this plan, the training squad has to train 3 people on three different stations in a month. One employee is trained on one station, say the vegetarian station for 10 days, and then for the nonvegetarian station for the next 10 days and so on. This is done till the employee becomes proficient on the station and iscapable of handling the station on his own.


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Performance Appraisal: Every employee joins in as a Trainee Crew where he is given the Green Badge. After a period of 3 months, the employee is checked for thehealth safety, cleanliness and sanitation after which he is given the Yellow Badge. After receiving the Yellow Badge, there are 5 stations that the employee hasto be proficient in: 1. Backroom Cleaning This includes mopping the floors, clearing the tables, maintenance of the machines etc. 2. Fried Products This involves frying of the French Fries, Pizza Puff etc. to the right degree. 3. Buns, Dress and Grill (BDG) This includes grilling the bun and dressing them properly. There is a time limit given to perform every function and the employee has to perform it efficiently, with minimum wastage. 4. Counter The last station is of thecounter handling. The employee should be able to converse with the customers courteously and take proper orders. 5. Personality The last criteria is the overallpersonality of the employee. McDonalds being in the service industry, having smart and courteous employees is of utmost importance to them. The productivity record has to show 90+ points. The productivity is various ways. For example McDonalds has a policy if

checked in

serving each customer within one minute on an average. The productivity at the counter is checked by the time taken by an employee to complete the order. For E.g.: If Freda (A service-counter in charge) has taken 2.5 minutes on a average to

serve each customer in her shift, at the end of the shift, the shit running manager will speak to her and ask her the reason


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and accordingly ask her to try and improve. If this trend continues, Freda is trained further. After the productivity record shows 90+ points, the employees have

to appear for a documented written test where they must get more than 90 marks.Having got a 90+ average of the two, the employee is promoted to

the next hierarchy level.

Consumer Perception about McDonalds in India To be successful in business one has to be etched in the minds of its customers. Hence, it is important to understand the customers perception. So what is perception? Perception is a process by which an individual selects, organizes and interprets information inputs to createa meaningful picture of the situation. Perception not only depends upon physical stimuli, but also on the stimulis relation to the surrounding field and connections with the individual. The key point is that perceptions can vary among individuals exposed to the same situation. People can emerge with different perception of the same object because of three perceptual processes: Selective AttentionSelective Distortion Selective Retention Selective Attention occurs due to individuals being exposed to so much information transmitted to them, they just shut

themselves up and pay attention


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to only a few information. For example people are likely to notice events that are pertaining to there current needs. They also notice stimuli that they anticipate will happen or whose deviation from the normal course is large.

Selective Distortion is the tendency to twist information into personal meaningsand interpret information in away that fits into the preconceptions. Thus, evennoticed stimuli are sometimes go unreacted by the prospect. Selective Retentioncauses one to remember the good points mentioned and perceived by the mind andforget good points mentioned about the unrelated and concepts that the mind hasnot perceived yet. In short, perception is a very complex through which one paints a unique picture of the situation, a picture that could be very different from the reality. Sometimes sensation and perception are used interchangeably but in fact, they are very different. Sensation is a collective interaction of the senses while perception is a complicated interaction of selection, organisation and interpretation. Perception begins with an individual is confronted by a stimuli which then is registered, interpreted by the brain and for which feedback is enacted. Numerous stimuli are constantly confronting with each other. Thus thereare many factors that affect the selectivity of the customer. The factors couldbe External or Internal.

EXTERNAL FACTORS: The external factors consist of environmental influences suchas intensity, size, contrast, repetition, motion, and familiarity to name a few.


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The intensity principle states that more the intensity of the cause, more likelyis it to be perceived. Closely related to intensity is the principle of size. Larger the size of the object, greater is the attention and higher is the probability of making an impact on the perception. The contrast principle states that the external stimuli that stands out against the background or which is not whatpeople were expected gets noticed which in turn enforces the retention ability.A repeated external stimulus by the retention principle is more attention getterthan singly transmitted information. The motion principle states that people pay more attention to moving objects in there field of vision than they to stationary objects. Familiarity serves as an important attention getting stimuli as people pay more attention to objects which they can relate to. INTERNAL FACTORS: Apart from the external factor there are some internal factors that also affect the selectivity process of an individual. People select situations from the environment to which they can appeal to and are compatible with there learning, motivation and personality. Learning pays a single biggest role in developing the perception of an individual. People generally look to relate information to alreadyexisting learning, any deviation from the expectations can either cause the subject to look for the reasons for deviation or just shut the mind out and refuse to incorporate the data.


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Motivation also affects the selectivity process the same way as learning does. Amotivated individual tries to incorporate any data that could cause him to improve his position or reinforce the existing belief that has motivated him. Personality is another factor which increases the selectivity process of an individual. The onus in todays world is on modifying the consumers selectivity in favor of the product that is being promoted. Once a product gets rated highly in the perception of the individual the product retention gets doubly simpler and helps theproduct or brand manager as the product gets wide attention and knowledge aboutthe product is already present the consumers mind.

REFERENCES OF LITERATURE REVIEW

Marketing Management - Philip Kotler (Tenth Edition) ISBN-81-203-1609-6 Organisational Behavior - Steven Robbins (Tenth Edition) ISBN-81-203-2283-5 Organisational Behavior - Fred Luthans (Ninth Edition) ISBN-0-07-120412-1


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RESEARCH DESIGN Exploratory Research We will use the descriptive research designwhere the main contact technique will be a survey method. This method will be used because it will help us to get the required responses from the individuals having various parameters such as age, sex, occupation, etc. Tool utilized for the contact: Our research will follow a combination of questionnaire, observationand personal interview method. The personal interview will help us to obtain a better insight into demographic and psychographic parameters. Data Analysis: Themain data analysis tools used will be: Formulation of cross-tabulated data usingchi-square test. Correlation (Factor affecting Perception) Hypothesis testing using Chi-square test for closed end questions (yes / no) Sampling Frame: Since it is not possible to define the exact list of visitors to Mc Donalds in Mumbai, as there is no sampling frame available from which the sample can be drawn. Defining the target Population:


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For any research study to be successful it is very important to carefully definethe target population so that the proper source from which data is to be collected can be identified. Since our study deals with consumer satisfaction with respect to Mc Donalds so we have chosen the target population that only those individuals who are regular visitor of the Mc Donalds. Hence our target population is defined as all individuals: 1. Aged between 14-50 2. Visits at least once in a month. 3. Have visited at least more than one McDonalds outlet. 4. Resident of Mumbai.

Sample Size: 1. The franchisees of McDonalds in the Mumbai area representing thewhole city are to be selected. 2. Sample of Approx. 150 customers selected randomly from different franchisees of McDonalds in the Mumbai area. Sample Size Determination: The sampling unit of our study will include males and females (age group of 2550) from middle and upper middle class, professionals and non-professionals. The sample size will consist of approximately 150 sampling units. The research will use Cluster-Sampling method and will use the stratified sampling wherein a particular stratum will be representative of demographic and psychographic parameters.


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Research would be based on probability sampling where a confidence level of 95%has been assumed with the standard error of 8%. Sample size would be determinedafter taking into account following factors Confidence Level: Corresponding z value (Z): Error in Estimation of proportion: 95 % 1.96 8%

In absence of information about the Population probability of customer enteringMultiplexes, Population Proportion (P) is assumed to be .5 to be on safer side.Their sample size n is calculated as follows, N N = = = P * (1-P) * (Z/E)2 0.5 *(1 0.5) * (1.96/.08) 2 150.06 150

Our sample size would be around 150, located in different parts of Mumbai.

Data Analysis: The main data analysis tools used will be: Formulation of cross-tabulated data using chi-square test. Correlation (Factor affecting Perception) Hypothesis testing using Chi-square test for closed end questions (yes / no)


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Nature and form of results: Hypothesis: H0: There exists a significant difference the perception of Customers visiting any Fast Food center. H1: There is no significant difference. H0: Demography has significant influence on the number of visits to the Fast Food centers H1: Demography does not have significant influenceon the number of visits to the Fast Food centers. Measurement instruments: Questionnaire Personal Interview Personal Observation Limitations of the study: 1] The study is limited to the city of Mumbai. 2] The study can be analyzed to have abrief overview of performance of McDonalds within Mumbai only and not outside it. 3] Time limitations & Cost limitations. Field Work: The sampling would be carried out at different McDonalds outlet located in Mumbai. The subjects which havebeen identified above would be approached at randomly selected hours in a day atthe McDonalds outlet.


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The subjects would be asked to fill up the questionnaire.

DATA TABULATION & DATA ANALYSIS

Gender based Male No. Respondents Percentage Respondents (%) of 58.82 41.18 100of 80 Female 56 Total 136

Out of the 136 respondents questioned 80 (58.82%) were Male while the remaining56 (41.18%) were Female.

Gender

F emale 41%

M ale M ale 59% F emale


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Food habits

RESPONDENTS Vegetarians Non Vegetarians TOTAL 50 86 136

PERCENTAGE approx. (%) 37 63 100

Vegetarian

50 Yes 86 No

Our survey recorded more Non Vegetarian visiting Mc Donalds than their Vegetariancounterparts.


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Frequency of Visit TIME Every day Twice in week Once in Fortnight Once In a Month Others TOTAL RESPONDENTS 0 14 32 60 30 136 PERCENTAGE approx. (%) 0 10 24 44 22 100

Frequency of Visit 70 60 50 40 30 20 10 0ve ry Tw da ic y e in O w nc ee e k in F O or nc tn e ite In a M on th ot he rs

Days

Frequency of Visit

Out of the 136 respondents surveyed almost 90% visited McDonalds visit atmost once in a fortnight.

E


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Favourite in McDonalds Products Mc Chicken Burger Mc Veggie Burger French Fries Others TOTAL RESPONDENTS PERCENTAGE approx. (%) 52 38 38 28 30 22 16 12 136 100

F v rite ao 6 0 5 0 4 0 3 0 2 0 1 0 0 M c C icke h n B rg r u e M c V g ie eg Brg r u e F n re ch F s rie O e th rs F v rite ao

The preference of the respondents shows a vast range of variance among the givenoptions. Also the data showed that the preference is not commanded by the foodhabit as many Non Vegetarians preferred Mc Veggie Burger and French Fries. Average Spending: Spending (Rs.) Less than 50 50-100 100-200 200 and above TOTAL RESPONDENTS 24 56 46 10 136 PERCENTAGE approx. (%) 18 41 34 7 100


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Spending 60 50 40 30 20 10 0


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Values for Money

No 22% Yes No Yes 78%

About 78% of the respondents claimed that Mc Donalds provides Value for money. Problems faced:

Common Problems Long Queues Wrong Order Bad Music Others Problems No Problems TOTAL

RESPONDENTS 54 2 22 22 54 136


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Problems 60 50 40 30 20 10 0es er Q ue u O rd M

Problems

Common problems faced by those who visit Mc Donalds are Long Queues while equal no. of respondents responded that they had No Problems during there visits. Somepeople also sighted Bad Music another major problem. Hesitancy after the "FrenchFries" issue:

Response Yes No Not Aware TOTAL

O th er s

Lo

P ro bl em N s o P ro bl em s

W ro ng

ng

B

ad

us ic

Respondents PERCENTAGE approx. (%) 24 72 40 136 18 53 29 100


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Affect of the French Fries Controversy80 70 60 50 40 30 20 10 0 Yes No Not Aware Responses

The survey results showed that more than half of the respondents are not affected by the Controversy while only 18% had been affected.

USP of Mc Donalds:


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Response Food hygiene ambience Quick Service Location TOTAL

Respondents PERCENTAGE approx. (%) 40 29 40 29 24 18 20 15 12 9 136 100

USP45 40 35 30 25 20 15 10 5 0 Food Hygiene Ambience Quick Service Location Response


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Respondents in the survey gave equal importance to Food and Hygiene as the two most identified USPs of Mc Donalds while Ambience, Quick service and Location receiving lesser weightage.


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RECOMMENDATIONS1. One of the observations from the survey that could be noticed were the usually long queues that the customers encountered at the outlets they visited. They had to wait in for some time before they can place the order which created some amount of inconvenience among the customers. So, in order to avoid the i


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