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Improving McDonald’s in China

International Business Research project pitch

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Improving McDonald’s in China

  1.  Erika Friedmeyer
  2.  Aim: To improve McDonald’s market share among fast- food giants in China How can McDonald’s appeal to adults (as more than the parents of children)? How can McDonald’s balance the novelty of western cuisine with local tastes?
  3. Industry McDonald’s KFC entered in 1987  Entered Beijing in 1992 Over $30b as of 2008  Over 1,100 restaurants Dominated by KFC &  Unchallenged by indigenous McDonald’s firms Rapidly growing industry  “Multilocal,” not multinational
  4.  Institutional Factors o Informal, cultural influences are very strong o Informal > Formal Industrial Factors o Rivalry, Substitution forces are strong o McDonald’s uses Cost Leadership Resource Factors o System of fast, consistent production o McDonald’s has a well-developed, tested value chain
  5.  Institution-Based View • Informal institutions Customers have to like it!
  6.  Beef isn’t very  Informal institutions popular  Industry factors China offers a huge market. What about rivals?  ??? Restaurants are used as public space
  7.  Why are McDonald’s restaurants appropriated into public property, turning it into a sort of public park? What can McDonald’s do to combat this?
  8. 4 Case Questionnaire Interviews Studies Mixed-method Research o Both quantitative and qualitative data Cross-Sectional Time Horizon o The issue will evolve over time
  9.  4 Chinese cities: Beijing, Shanghai, two small cities/towns School-age 2,000 respondents (14-25) Young Stratified Professionals Professionals Random Sampling (40-60) (25-40) Retirees (≤60) Interviewees will be randomly selected from
  10.  How long is your average visit? o 5-10 min, 10-30 min, 30-60 min Rank the purposes for your visit. o Quick meal, visit with friends, read the paper Rate the friendliness of the staff. o Extremely Unfriendly Extremely Friendly 1 2 3 4 5 6 7
  11.  Semi-Structured Respondent-based Focus groups Sample questions o When you visit McDonald’s, with whom do you go? o How long is appropriate to linger after the meal is finished?
  12.  150pilot questionnaires  Focus groups in Beijing o Various age, social groups Participants asked to comment on clarity, difficulty of questions
  13. Qualitative Quantitative  All data cleaned Transcribed/translated  Imputed Response Analytic Induction Substitution o Conditions may not mandate phenomenon  Multivariate Technique o Multivariate Analysis of Variance o Risk of over-simplification
  14.  Large sample size Drawing from four cites: two large, two small Variety of age groups Not limited to McDonald’s frequenters Highly-trained interviewers
  15.  12 months o 8 months for data collection o 4 months for data analysis
  16.  Four interviewers Two translators Researchers and Analysts Statistical, Qualitative Data Analysis Software
  17.   References can be found in an additional document upon request.Contact Mrs. Dena Warneke ( for more information.