Challenges of Marketing Across Cultures

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People now live in an "Ethics Era", where the International marketers are tailoring changes according to society's expectations. Ethics are a set of moral principles that govern a person, groups or cultural behaviour. Culture and expectations within culture has an impact on all marketing business deals. It is essential to realize the expectations of different stacks of culture around the world. Marketing ethics has developed in the context of business ethics that reflects the interests of various stakeholders in the exchange process (Carrigan, et al., 2005). Any company along with the moral issues should emphasize on identifying, anticipating and satisfying customer needs. If the companies seem ethical and follow the ethical codes and norms regulating their self-interest, they will be recognized and appreciated by the consumers.

The above concept is demonstrated taking McDonalds as a company, which markets its products in several different countries and how it has adapted its marketing mix in Singapore and India conforming to different cultural characteristics:

McDonalds follows the policy what food manufacturers do i.e., taking into account the homogeneous and heterogeneous cultures, understanding consumer differences from the perspective of cultural, social, economic and other marketing environment elements and search for common groups of consumers across countries, for International market segmentation purposes. McDonalds follows the localized and global marketing strategies wherein the potential elements of different cultures like language, needs and wants, consumption patterns, market segments, socio-economic and marketing conditions are well taken care. Consumers are given basic rights to be safe, to choose, be informed and be heard.

Case Analysis of McDonald's

COMPANY NAME: McDonald's, Inc.

INDUSTRY: Food Service

COMPANY WEBSITE: www.mcdonalds.com

COMPANY BACKGROUND: McDonald's is the world's largest chain of fast food restaurants, serving nearly 54 million customers daily. McDonald's is primarily seller of hamburgers, cheeseburgers, chicken products, French fries, breakfast items, soft drinks, milkshakes and desserts. More recently, it also began to offer salads, wraps and fruit. Many McDonald's restaurants have included a playground for children and advertising geared toward children, and some have been redesigned in a more 'natural' style, with a particular emphasis on comfort.

As a company, McDonald's was first introduced in Des Plaines, Illinois in 1955.   This was the very first McDonald's restaurant, which all started in San Bernardino, California in 1954 when Ray Kroc approached the McDonald brothers with a business proposition to start a new company.   In 1965 McDonald's went public and was later, in 1985 added to the Dow Jones Industrial Average.   (www.mcdonalds.com).

Case SWOT Analysis of McDonald's

Strengths:

McDonald's has a Strong Global presence. It is the leading fast-food organization in the world with 32,478 (as of 2009) restaurants serving burgers and fries in 118 countries.

McDonald's has a worldwide brand image and reputation. It has the same strategy   in every market all over the world, but also takes into consideration the local beliefs and likes of people of the respective country. That is the reason why, it is considered most famous and loved brands in the world.

Innovative products to attract the customers: McDonald's launches several different innovative products regularly to attract the customers such as: happy meals for kids, giving away small toys with the kids meal, organizing birthday parties and other events in the stores for the customers, considering the local favourites such as Aloo tikki burger and Paneer salsa wrap in India.

McDonald's offers the consumers choice, reasonable value and great service.

Wi-fi Internet, play zones for kids at all the franchises.

Weaknesses:

Quality issues across the franchise network: Customers require the same quality of food in all the franchises which McDonald's fail to achieve.

The core products of McDonald's does not meet the trend towards healthier lifestyles of adults and kids.

Opportunities:

Healthy lifestyle food segment: Introduction of a new segment which supports the latest trend of health conscious groups.

Growth of fast-food industry.

Joint Ventures: Joint ventures with the supermarkets such as costco.

Using more environment friendly products and processes can help them achieve socially responsible tag.

Threats:

Social changes - Government, consumer groups encouraging balanced meals, 5 a day fruit and vegetables.

Focus by consumers on nutrition and healthier lifestyles.

Competitive pressures on the high street as new entrants offering value and greater product ranges and healthier lifestyles products. E.g. subway.

This document is a brief research on how McDonalds reinvents new menu for its outlets in Singapore and India

in order to satisfy the taste buds of the consumers of different cultures:

Analysis on the Market strategies adopted by McDonalds in Singapore (March 2006 to April 2009)

Singapore's social and ethnic fabric is a unique blend of cultures and people - Malays, Chinese, Indians and now the expats. Singapore's lifestyle is multi-cultural with each of these ethnic communities maintaining their unique way of life. Singapore's society is cosmopolitan due to the influx of foreigners in recent times, The Free Library, 2008, Singapore population boosted by influx of foreigners, [online], available at:

http://www.thefreelibrary.com/Singapore+population+boosted+by+influx+of+foreigners-a0186685101 [Accessed 17th November 2010]. Singapore's population enjoys one of the highest levels of health and nutrition in Asia. Singapore promotes a clean and green environment. It encourages a healthy lifestyle and diet. Cleanliness and hygiene are imbibed in its system. The government of Singapore has taken up many healthcare reforms and educates its citizens through proper government channels (ex. Print Media, Television, Internet, etc.).

Keeping in tune with the government policies and going by the history of McDonalds which has a strong vibe for socio-cultural preferences of the people with regards to eating habits. We can see the following trend and initiatives taken by McDonalds in Singapore from 2006-2009

Singapore, 3 April 2009

McDonald's customers will enjoy a new grab-and-go value experience with the introduction of Spicy Snack Wrap island wide on 30 March 2009. At just $2.50, the Spicy Snack Wrap packs a punch with golden brown spicy chicken strip, fresh lettuce and cheese with spicy Chipotle BBQ sauce wrapped in a tortilla. It's a convenient light bite with a spicy kick for people on the move (www.mcdonalds.com.sg).

The new item in the menu is an extension of McDonald's commitment to providing great value experiences - with no compromise on great food quality - for its customers, in view of the current economic downturn. McDonald's wants to reinvent new recipes to give its customers a variety of great tasting value experiences leaving their customers with another reason to enjoy a new taste teasing their taste buds.

Singapore, April 10, 2008

'Kick off your day to a winning start with McDonald's latest innovation: the McGriddles Breakfast Sandwich…McDonald's customers have two choices: Sausage McGriddles or Sausage McGriddles with Egg. As Breakfast Leader, McDonald's continues to innovate and to find novel ways to meet evolving consumer tastes and hectic, changing lifestyles'. McDonalds, 2008, Get your morning boost with McGriddles, [online], available at: http://www.mcdonalds.com.sg/pr_04_10_2008.html [Accessed 16th November 2010].

McDonald's focuses on being a leader in its game by attracting its customers not just for a grab when hungry but also enjoy a happy breakfast through its innovative breakfast range which constitutes a quick, easy, convenient and tasty breakfast to a weekend family breakfast.

Singapore, March 22, 2006

'McDonald's "SIDEKICKS" offers fresh new choices. Great value at $1 each with an extra value meal. McDonald's is offering more choices and variety than ever before with the launch of three delicious side items - Corn Cup, Fresh Salad and Apple Dippers. …choices that customers want - and reflects its ongoing support for the Health Promotion Board's "eat 2 servings of fruit + 2 servings of veggies" public educational outreach McDonalds, 2006, McDonald's "Sidekicks" Offers Fresh New Choices, [online], available at: http://www.mcdonalds.com.sg/pr_22mar2006.html, [Accessed 16th November 2010].

As mentioned previously Singapore's market is very health conscious and offering fruit and veggies as sides to any meal, this is to meet the needs of the health aware consumer. The consumer will feel that as they are getting part of their 5 a day fruit and veg, as there has been much publicity on McDonalds not being healthy this will improve their corporate reputation. Parents of children will not mind taking their kids to McDonalds as in addition to the play areas installed in the majority of restaurants, they also have healthier choices of food. One of the major market target area of McDonalds recently have been children and parents of the children.

Analysis on the Market strategies adopted by McDonalds in India (August 2006 to October 2009)

India is a diverse and a complex country. People of India reflect the rich glories of the past, the culture, traditions and values relative to geographic locations and the numerous distinctive manners, habits and food that will always remain truly Indian. Food in India is wide in variety, taste and flavour. Being so diverse geographically, each region has its own cuisine and style of preparation.

With all the above complex socio-cultural environment, McDonald's has successfully adapted to the Indian market by offering a wide variety of tailor made menu list to cater for the Indian market as it understands the importance of its presence in India because of the economic growth of the country which has substantially grown in the past two decades.

October 16, 2009

McDonald's Offers Potato Burger with Fries, No Onions in India

'McDonald's, the chain famous for hamburgers tailors its menus to local tastes. Some items, including the McAloo Tikki and Pizza McPuff, were exported to restaurants in the Middle East. While locals expect the different menu, foreigners used to a Big Mac can be taken aback by a Chicken Maharaja Mac. The mashed-potato sandwich is the highest-grossing item on the menu. It costs 50 cents in a nation where the World Bank says 456 million people live on $1.25 a day or less. That's enough people to form the world's third-largest nation'. Bloomberg, 2009, McDonald's Offers Potato Burger With Fries, No Onions in India, [online], available at: http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aS3rBACqZf7Q (accessed 16th November 2010).

As you can see the marketing mix across cultures that McDonalds have catered their needs to the Indian population and based their pricing model to meet the majority of the nations pay packets. This will enable McDonalds to reach a wider customer base, potatoes form part of the Indian staple diet and can be found in abundance in North Indian and South Indian foods such as Aloo Gobi and Masala Aloo. It can be seen how well the marketing team has advised McDonalds in order to meet the needs of the everyday consumer, this can be seen in how successful McDonalds has been worldwide.

April 2, 2007

Where's The Beef? Meatless McDonalds Burgers in India

McDonald's restaurants can be found everywhere, including India. But as CBS News' there is one menu item that's drastically different there: the burgers. 'In India, there's something missing at the world's fast food giant: hamburgers. That's right - McDonald's signature snack and its most recognizable symbol is nowhere to be found in one of the biggest countries on earth. India is the world's vegetarian paradise. Nearly all of the one billion people living here eat meat only occasionally, or not at all. Beef never shows up on the menu. India is home to the Hindu religion, which preaches non-violence. Believers fear the karmic consequences of harming other creatures'. CBS News, 2007, Where's the Beef? Meatless McDonalds Burgers in India, [online], available at: http://www.cbsnews.com/stories/2007/04/02/asia_letter/main2640540.shtml?tag=mncol;lst;1 [Accessed 16th November 2010]

McDonald's provides a new menu range where people are not for beef and pork. There is no beef in India because the majority of its 1.22 billion people are Hindus and revere cows. It also doesn't serve pork items in deference to Muslims. Instead, it offers vegetarian and chicken dishes with items starting at about 40 U.S. cents. All restaurants have separate kitchens for vegetarians, including those who don't eat root vegetables like garlic and onions. McDonald's believes in analysing and satisfying the tastes of people of all different cultures.

Conclusion

McDonald's has successfully adapted to different ethical backgrounds by tailoring changes in its approach in different cultural platforms by maintaining consistency in the taste and quality of products and including more items in its product line at a great value which is easily affordable by every hungry man who wants to grab a burger and even a non-hungry man who is tempted to have a bite of the burger.

McDonald's celebrated 14 years of leadership in food serve retailing in India. It has a network of over 160 restaurants across the country with its first launch way back in 1996. The success of McDonald's is the result of the company incorporating marketing ethical values. The company not only emphasises on the theoretical elements of the marketing mix by producing a good quality product tagged with a fair price but also caters to the tastes, the likes and dislikes of various cultures across the world.

The market is purely culture based and by adopting the same McDonald's remains in the leading edge (and is the world's largest fast food chain) of International marketing and theory by understanding consumer differences from the perspective of cultural, social, economic and other marketing elements.

McDonald's has successfully adopted to various socio-cultural environments and the same can be clearly seen and illustrated by taking into account the growth of McDonald's restaurant from 2006 to 2009 across the world (http://www.wikinvest.com/stock/McDonald's_(MCD)).

McDonalds

2006

2007

2008

2009

Total Restaurants

31,046

31,377

31,967

32,478

Appendixes