Case 1-2: “McDonald’s Expands Globally While Adjusting Its Local Recipe” Discussion Questions:
1) McDonalds has a mixed global marketing strategy that combines Globalization and the ability to act local. Globalization refers to developing a marketing strategy as if the world is a single entity and to sell the same product with same promotion, same packaging all over the world regardless of geographic, demographic, political, social and cultural differences. McDonald’s global marketing strategy refers globalization in many terms but also takes into consideration local tastes and expectancies, and creates value with its capability to act local when required; this strategy is called glocalization.
The company has a high level of standardization which creates effectivenes in production that decreases the price and time of service. The packaging, the core menu, logo, brandname, distribution strategy, positioning of the company, main idea of the advertisements, design of the stores, business model, taste of the food, desing of the kitchens and working conditions of the workers are same everywhere in the world. As a strategy the company keeps all these operations standardized in order to remain profitable and global. However there are cases where standardization becomes an obstacle and McDonalds needs to make adjustments in order to enter the local market and expand its market share. In these cases, considering local preferences; product localization is done, some local tastes could be added to the menus (although its menus vary from country to country its core product offering is consistent on a global basis), as a marketing localization the company can combine local expectations with core values of American McDonalds and reach the target demographic.
McDonals is a perfect example of : “Think global and act local”.
Although it is highly standardized, the fact that 70% of its stores are franchises, and 80 to 90% of its suppliers are local businesses allows the company to act small and respond local demands in an effective way.
This provides also the opportunity to think local and act global on the basis that franchises and localized products may become global by time. For example, in January 1997, McDonald’s announced a global alliance with Walt Disney which allowed them to share exclusive marketing rights for everything from films to food, for the next ten years. This has led to McDonald’s producing toys in their “happy meals” for films such as A Bug’s Life, Toy Story and the latest Disney offering, Tarzan. In this instance, there is no need for McDonald’s to act local, the Disney charecters might be considered local or European but their effect had been global; as Walt Disney has a world-wide appeal that does not need altering for different communities.
2) Russia, China, India together with Brazil represents the BRIC countries which are considered to be at a similar stage of newly advancement development. These biggest and fastest growing emerging markets also atired the attention of the global fast food company McDonalds.
In the light of the information given in the case, we may claim that McDonalds is not very well welcomed on the other side of the globe because of its image linked to capitalism and imperialism of culture. It’s neither legal nor logical for governments of free market economy to take additional precautions to hinder the company’s activites. It’s obvious that the franchising strategy of McDonalds will provide large scales of employment wchich will help countries fight with unemployment rates. Moreover, McDonalds purchase 80 to 95% of its inputs from local suppliers which is an opportunity for local businesses to grow up, likewise in the case of Russia.
On this basis, we can’t really claim government’s role (even if they are not welcoming) but we must focus on the spirit of the streets and activist people who organize protests and boycot the company in some cases for valid...
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