McDonald's & Consumer behavior by students of Capital University of Science and Technology Islamabad, Learning Objectives of Consumer Behavior chapters in relation with McDonald's company, Analysis of McDonald's that how they are using concepts of marketing and consumer behavior

1. McDonald’s
Mahnoor Bilal (BBA173003)
Sameer Farooq Khan (BBA173014)
Wajahat Farooqi (BBA173041)
Laiba Shafique (BBa173082)
Capital University of Science and Technology

2. AGENDA
• Chapter.1 Technology-driven Consumer Behavior
• Chapter.2 Segmentation, Targeting, And Positioning
• Chapter.3 Consumer Motivation And Personality
• Chapter.4 Consumer Perception
• Chapter.5 Consumer Learning
• Chapter.6 Consumer Attitude Formation And Change
• Chapter.7 Persuading Consumers
• Chapter.8 From Print And Broadcast Advertising To Social And Mobile Media
• Chapter.9 Reference Groups And Word-of-mouth
• Chapter.11 Culture’s Influence On Consumer Behavior

3. INTRODUCTION
 McDonald’s was born in California in 1940. It started as a fast food restaurant by brothers
Maurice and Richard McDonald.
 McDonald's is in the top ten most valuable U.S. brands of 2020 based on company value
 Its brand value of 143.8 billion U.S. dollars placing it seventh on the list.
 The company reported spending over 440 million U.S. dollars on advertising worldwide in
2019.
 McDonald is one of the largest chains of hamburger fast food restaurant. More than 58
million customers serve daily worldwide by McDonalds.
 A McDonald’s restaurant runs by a franchise, an affiliate or the corporation itself.
 The company’s revenues come from rent, royalties, and fees paid by the franchisees, as well
as sales in company-operated restaurants.

4. Chapter.1 Technology-driven Consumer Behavior
 To understand the evolution of the marketing concept, the most prominent tools
used to implement marketing strategies, the relationship between value and
customer retention, and the objectives of socially responsible marketing:
 Marketing Concept
Mcdonald’s has focused on delivering constant improvement across each of the 5P''s
 Product
 Place
 Price
 Promotion
 People

5. CONT.
 How the internet and related technologies improved marketing transactions by
adding values that benefits both marketers and customers:

6. CONT.
 To understand the interrelationships among customer value satisfaction and retention
and technology revolutionary role in designing effective measures and strategies:
 Value
 Services
 Cleanliness
 Branding
 Quality

7. CONT.
 To understand consumer behavior as interdisciplinary area consumer decision making
and the structure of the book
Consumer decision making Process
 Problem/Need recognition
 Information search
 Evaluation of different alternatives
 Purchase decision
 Post purchase behavior

8. Chapter.2 Segmentation, Targeting, And Positioning
 To understand the interrelationships among market segmentation, targeting and
positioning and how to select best target market:
 McDonalds segmentation, targeting and positioning is one of the integral components of its marketing
strategy.
 Segmentation involves dividing population into groups.
 Positioning refers to the selection of the marketing mix the most suitable for the target customer
segment.

10. CONT.
 To understand the bases used to segment consumers, including demographics
psychographic product benefit sought and product usage related factors:
 Geographical; region, density
 Demographical; age, gender, life-cycle stage, income, occupation
 Behavioral; degrees of loyalty, benefits sought, personality, user status
 Psychographic; social class, lifestyle

11. CONT.
 To understand how to position differentiate and reposition product
 McDonald’s has made itself to be the family friendly low-cost restaurant in the fast food business.
 They have a narrow scope for a customer base and a low-cost strategy.
 The computer operated machinery allows you to keep cost low by only needing a few employees to
do the work of several. It also allows your employees to do it quicker.
 if you notice, many McDonald’s have dual drive-through to decrease wait time and to increase
volume of customers served. This may be good idea for your location

12. CHAPTER 3: CONSUMER MOTIVATION AND
PERSONALITY
 To understand motivation theories and their applications to consumer behavior.
 Consumer’s position in motivation theories
 Acts differently in every region
 Middle-high class food chain
 Create environment according to consumer needs

13. CONT.
 To understand how to identify and measure motives.
 Quantitative Surveys
 Satisfaction Surveys
 Online Surveys
 To understand how innovativeness and other personality traits influence consumer behavior
 Involving every type of personality
 Keep on introducing new types of meals time to time
 Huge collection of products suitable for every type of consumer.

14. CHAPTER 4: CONSUMER PERCEPTION
 To understand why consumers, process only a small amount of the information
they receive.
 Introduce new products according to consumer perception, loyal customers and competition.
 Prioritizes excellent customer service, product quality, hygienic and cleanliness in their
restaurants.
 Continuously counter competitor's products

15. CONT.
 To understand why and how consumers “add” biases to stimuli and the implications
of this tendency for marketing.
 McDonald’s is one of the largest brand advertisers on Malaysia television
 Sales technique within the restaurant have a tactical role to play in getting the customer to return to the
restaurants regularly.
 Before a person makes the decision, a series of alternatives must be available.

16. CONT.
 To understand the elements of consumers’ imagery.
 McDonald's offers meals and other product bundles for prices that are discounted
 Make food fast available to its customers at a very low competitive price
 Capture consumer’s stimuli and the implications on their own favor

17. CHAPTER 5: CONSUMER LEARNING
 To understand the elements of learning in the context of consumer behavior.
 Different types of basic advertisements approaches.
• Introduction of a new meal (product), Especial event advertisement, Targeting different
age groups etc.
 Product oriented advertisements

18. CONT.
 To understand the role of observational learning in consumer behavior.
 Don’t usually use popular celebrities in their advertisements
 Use different celebrities in different advertisements
 Popular animated characters to get children’s attention

19. CONT.
 To understand consumer involvement and passive learning, and their impact on
purchase decisions and the retention and recall of promotional communications.
 Uses social media, television and billboards for its advertisements
 Social media is more interactive and attractive
 Billboards advertisements are especially designed to attractive information seeking cognitive type
consumers

20. CHAPTER 6: CONSUMER ATTITUDE FORMATION AND
CHANGE
 To understand what attitudes are, how they are formed, and their role in consumer behavior.
 McDonalds innovates new products all the time like CHAPLI KABBAB Burger in Pakistan so Consumers Learn
Attitudes
 Company knows their Ice cream is popular among their consumers so the Role of Personality factors in many
variants in their desserts section were created McFlurry I n many flavors.
 To understand the tri-component attitude model and its applications.
 The Tri-Component Attitude Model
 The Conative Component was triggered in the McDonalds kitchen inspection to inform consumers that their
product has hygiene and quality food
 The Affective Component in their ads they say their slogan (I am loving it) and name their kids meal is called
(happy meal) This shows the approach to the emotional aspect of the Consumers
 Altering Consumers’Attitudes McDonalds is often related to obesity and un healthy food in order to alternate this
vies they introduced Salads and apple slices in their menus

21. CONT.
 To understand the structures of multi-attribute models and their use in altering consumers’
attitudes.
 Multi-attribute attitude models portray consumers’ attitudes as functions of their assessments of the objects’ prominent
attributes.
 Attitude-Toward-Object Model The attributes McDonalds provides to its customers vary region to region as the value
Asia holds to American attributes are less so if the Burger has more flavor it will be more popular in India than Poland
 Attitude Toward-Behavior Model McDonalds noted the sale in Muslim countries in Ramzan would increase if they
introduced iftar deals as they studied the consumer attitude behavior.
 To understand how to alter consumers’ attitudes by making particular needs prominent.
 The Utilitarian Function the Environment that McDonald’s provide with its well-lighted and clean atmosphere
motivates a family friendly Attitudes making it favored by Families.
 The Value Expressive Function: McDonalds by no means is not the cheapest when it comes to prices but it justifies its
Value by claiming its raw material is attained from specified vendors for example its eggs must be sanitized and packed
before receiving it as shipment.
 Associating Brands with Worthy Objects or Causes during the first wave of Covid19 in Pakistan McDonalds offered free
breakfast to essential and healthcare workers

22. CONT
 To understand the role of cognitive elaboration in altering attitudes.
 The elaboration likelihood model (ELM) that attitudes can sometimes be changed by either one of two different
routes to persuasion—cognitive elaboration
 On March 22, 2016 An advertisement in America showed some unhealthy options like fries being thrown out
and apple slices with milo milk added in to persuade parents that their product is healthy option for kids
 To understand how attitudes can precede behavior in the form of cognitive dissonance and
the resolution of conflicting attitudes.
 Cognitive dissonance occurs when a consumer holds conflicting thoughts about a belief or an attitude object. In
April 12, 2014 a rumor had spread in Pakistan that McDonalds food is not halal the news was not from an
official source so some consumers became double minded and hence felt dissonance.
 Resolving Conflicting Attitudes McDonalds launched this statement attempting to resolve this issue (Our 100%
pure and Halal meat is all sourced from approved suppliers as well as globally recognized Halal practices. No
pork or pig derivatives are used in McDonald's restaurants) on website.

23. CONT
 To understand the ways people, assign causality to events and apply this knowledge to
consumer behavior.
 Foot-in-the-Door Technique sometimes McDonalds has to create a taste for western burger foods
before actually opening up its full menu that’s why in countries like china and Vietnam it had to
introduce full rice options cooked in western style before introducing burgers and Wraps.
 Attributions Toward Objects consumers can have a negative or unsatisfactory to experience to
product because something they themselves did for e.g. if McDonald’s meal is eaten cold or the day
after the taste is not the same so a negative attribute can develop.

24. CHAPTER 7: PERSUADING CONSUMERS
 To understand the elements and persuasive capabilities of communication, as well as the barriers to effective
communication.
 The Communication Process. McDonald uses a vast array of mediums in their marketing strategy to reach the consumers
these include the McDonald's app which can show promotions and deals going on in the restaurant also you can trace your
order. Furthermore, traditional methods are used but are not as effective as new media for example on social media sites.
 Taking example for word of mouth in McDonald's desserts such as ice-cream has become popular due to the word of
mouth as consumers have recommend each other because of their satisfaction which they received from consuming the
product
 To understand the distinctions between broadcasting and narrowcasting.
 Broadcasting it is the way of traditional media in which the message is sent one way and the receivers of the message
cannot respond to the source examples can be of McDonald's TV ads and the ads seen on YouTube of McDonald's
 Narrowcasting in which the response and the number of views can be measured and the data collected can be acted upon
which is effective and efficient at the same time
 example can be one dining at McDonald's a crew member approaches you and take some measure of your time for filling
up of form of customer satisfaction in return they give you a free ice cream the data collected can be Addressable,
Customized, Interactive And Response Measurable

25. CONT
 To understand how to design persuasive messages effectively. McDonald’s launched
their favorite brand campaign with a TV advert created by Leo Burnett.
 IMAGES AND TEXT are used in This ad titled “Nah, you’re alright” uses emotion to capture its
audience and is therefore a “Feeling ad” rather than a “Thinking ad”. It brings to light the idea that
McDonalds burgers can mend bridges between families. Way of showing that “We all have McDonalds in
common”. Thus, although research shows that emotional appeal works in advertising,
 MESSAGE FRAMING is used in this advert uses negative rather than positive emotions.

26. CONT
 To understand the effectiveness and limitations of prominent advertising appeals.
 McDonalds BUN KABAB introduced in Pakistan created a Humorous Appeal to the desi food loving community
the add on radio introduced in a funny accent attracted attention.
 The golden Arches and the main star the BIGMAC have created a Timeliness Appeal and by introducing a gold
coin for each one ordered promoted the product and Brand without an expire date.
 To understand how to measure the effectiveness of advertising messages.
 Measures of Message Effectiveness McDonald’s used to be all about the food, but in 2018 it chose to focus on
strides in customer experience, physiological measures were being highlighted how the brand is making it easier
for everyone in restaurants as the people in the add were facing everyday problems.
 The campaign is made up of three different ads, called ‘Hands Full’, ‘Grownup’ and ‘It Must Be’.
 Each one shows a different in-store innovation, including the McDonald’s mobile app, in-store order screens, and
table service attitudinal measures were expressed as the services and clean tables attracted logical audiences who
use cognitive sense to make opinions. Part of McDonald’s aim was to change perceptions (and highlight
innovation), making it a story driven and highly engaging campaign that targeted families in particular with these it
showed persuasion effects especially for families.

27. CHAPTER 8: FROM PRINT AND BROADCAST ADVERTISING
TO SOCIAL AND MOBILE MEDIA
 To understand the strategic superiority of impression-based (eyeballs) targeting over segment-
based targeting.
 When broadcasting their ads on TV marketers don’t know which Half of them adds are seen and how many eyeballs they
have collected so in order to attract new consumers McDonald’s broadcasts them adds on TV and Radio but uses New
Media such as the McDonalds app and social media accounts where they attain accurate data regarding their Exposure
and Retargeting for more deals and other updates
 To understand Google’s targeting and advertising capabilities and its value to both consumers
and marketers.
 Google collects data on the average users and shows them adds for e.g. if a user searches for burgers automatically adds
of McDonalds are shown Web-search ads McDonald’s APP ads are considered Mobile advertising
 To understand the dynamics of social media and its strategic and promotional advantages
over other media.
 McDonalds has a separate social media account for every region they have a Franchise in they advertise their deals and
interact with the teen’s segment on social media. When on social media more followers of similar interests can be
attained. Social networks create interactions among group members via “discussion boards” and by allowing members to
post pictures, music, video clips, and other tidbits for the groups’ members to view.

28. CONT
 To understand how consumers, use mobile media and their reactions to mobile advertising.
 McDonald’s sent messages via mobile phones that Health care workers can have a free breakfast this created
emotional value Emotional value Also Social value is created when McDonalds send messages on special
international days like Mother’s Day women’s day with small motivational messages
 To understand how to measure the effectiveness of advertising in traditional and social media.
 Return visits can be measured by the Help of the McDonalds APP append consumers are rewarded with ice-cream
and information about the new deals before regular consumers can. DATA collected on consumers can help in seeing
if the new ads are effective in their attempts to send encoded message and result in Gauging Influence within Social
Network
 To understand the advancement of print and broadcast media into electronic communications.
 Advancement in electronic media and the shift from traditional media to electronic medium can be seen in
McDonalds all their menus are seen above the counter on LCDs also new smart ordering systems are installed on
entrance help to create a non-human supported food ordering system even cash is paid via debit card and the
order is made electronically.

29. Chapter.9 Reference Groups And Word-of-mouth
 To understand the credibility of reference groups and their influence on
consumer behavior.
 Consumer is highly influenced by the member of the family. If buying decision of
some product is influenced by children then McDonalds will target kids in their
advertisement.
 Reference group have the potential in forming an impression or persons attitude
towards the product. The effect of Reference groups varies across product. It tends to
be strongest when the product is visible to other consumers.

30. CONT.
 To understand the persuasive power and credibility of spokespersons, endorsers,
celebrities, salespersons, vendors, and media.
 Celebrities make really good salespeople. When a much-loved star endorses a product,
it gains immediate credibility. And for a long-standing product or business, a celebrity’s
involvement reinforces the product’s relevance.
 But the key here is that the celebrity is relevant and familiar to the brand’s target
audience. McDonald’s collaboration with pop star Jessie J is a great example of this.
 As part of the fast food giant’s global 24-hour ‘day of joy’ campaign – the brand’s
biggest marketing drive since its decade-old “I’m lovin it” campaign – Jessie J hosted a
surprise concert on a double decker bus in London.

31. CONT.
 The hour-long performance was streamed live across McDonalds’ social media
channels. Jessie J was also joined by YouTube stars Thatcher Joe and Lucy & Lydia
were absolutely spot on and relevant choices for McDonald’s’ target audience.
 Celebrity endorsements now need to go further than simply a tweet or a TV ad – live
experiences really are the route to success.

32. CONT.
 To understand the strategic applications, advantages, and potential perils of
word-of-mouth.
 McDonald’s has used word-of-mouth marketing strategies to boost sales and raise its profile.
In March, the American fast food chain invited people who had discount coupons on chicken
wings from any restaurant in China — including rivals like KFC — to use them to buy McSpicy
Wings at a discount.
 Building on the buzz, McDonald’s promised that if one million people in China were to pledge
their love online for McSpicy Wings, it would hand out free chicken wings for seven days at
seven restaurants. In just four weeks, more than two million people signed the pledge and
McDonald’s happily handed out 10,000 free wings. Because of these word-of-mouth
promotions, sales of McSpicy wings shot up by 10% in March over the previous month.
 Physical or virtual, word-of-mouth is an essential brand-building tool for companies in China.
60% of Chinese consumers say friends and family members (F&F) are a major source of product
information, based on which they make purchase decisions.

33. CONT.
 To understand the process for diffusion of innovations, and adopter categories as
distinct market segments.
 Historically, McDonald's had a diffuse innovation process. An individual franchisee might
develop and launch a new food item. If the food item caught on, the idea might spread to
other markets. This process produced some big winners, such as the Egg McMuffin
breakfast sandwich, the Big Mac and kid-friendly Happy Meals.
 For example, while McDonald's owns peak meal times in many markets, most people still
eat breakfast at home. New products targeting the on-the-go breakfast eater, such as the
popular McGriddle product, helped the company grow its share of the breakfast market.

34. CONT.
 Many McDonald's franchises are now open 24 hours a day. To try to draw people at
slower hours, McDonald's borrowed a page from Starbucks' playbook, improving the
quality of its coffee and making its stores warmer and more accessible, encouraging
consumers to linger in the afternoon or early evening.
 By exploring untapped avenues for expansion beyond simply opening more stores,
McDonald's created new opportunities for innovation.

35. Chapter.11 Culture Influence on Consumer Behavior
 To understand culture’s role, dynamics, evolution, and impact on consumers’ priorities and
behaviors.
 McDonald’s marketing has different strategy in different regions.
 Even in Asia, the advertising content for each country is different.
 For example, in Japan, most Japanese have high preferences on animations and the animation in Japan
is the fastest growing industry as well. So, McDonald tends to use more animation elements for
marketing and advertising. Many well-known cartoons were used in McDonald’s advertisement
marketing that enhances the attractiveness and popularity of products.
 McDonald’s in China, Kung Fu and the movie stars of the show are utilized in advertisement. Its
marketing was integrated Chinese traditional culture with star effect.

38. CONT.
 To understand language, symbols, and rituals as expressions of a learned culture.
 McDonald’s carefully standardized food items according to local tradition and culture. For
example, in Middle east Arab countries, McDonald’s consumer can get McArabia (grilled
halal chicken with Arabic spices and bread), New menu for Vegetarian in India as some
people don’t consume meat, in addition to this they avoided beef as cow is sacred in Hinduism
i.e. majority religion in India, Shogun Burgers in Hong Kong (Teriyaki pork), McShawarmas
in Israel (Kosher meat), Bubur Ayam McDs in Malaysia (chicken porridge), McPaltas in Chile
(a burger with avocado paste), Bulgogi Burgers in South Korea (thinly sliced meat in bulgogi
marinade).
 Furthermore, McDonald’s marketing and advertising strategy were different for different
regions. Their advertisement reflected different culture, subculture, racial group and social
class. Also, regular and repeated exposure of an advertisement brings about a familiarity and
positive feeling about the brand.

39. CONT.
 To understand how to measure the influence of culture on consumer behavior.
 The statistic shows that fast food is developing and expanding immensely.
 Hence, many people are consuming fast food and take it regularly either lunch or dinner and
even breakfast.
 The working force increased due to rise in numbers of women employed, including
international students and foreign workers have arisen.
 McDonald used the idea of sub-culture by diversifying few of the restaurants into ‘Halal’
restaurant to accommodate with Muslim customer.
 Diverse number of different ethnic background, McDonald operates various events with a
promotional item to attract the client.
 McDonald’s customer profile is considerably diverse. Family comes with their children for a
sweet treat; kid’s visits McDonald’s for seeking fun and young adults come for a value meal.

40. CONT.
 The fast food is driven by multi-cultural people in Malaysia.
 McDonald has tried in promoting the different cultural promotional menu.
 The idea of launching free internet service in the McDonald restaurants helps to get
customers walk into the restaurant.
 The free Wi-Fi concept attracted students
 Consumers can make payments with hassle free via card payments
 The fast-food trend takes away the concept of cooking in the house to save time.

41. CONT.
 To understand Americans’ core values and how to apply them to persuasive
communications.
 McDonalds HEALTH campaign includes organized, communication-based interventions
aimed at different group of people and communication activities include social marketing
effort. McDonald’s communication objectives:
 The image of McDonald is change from junk food restaurant to one restaurant that serves
healthy food
 The major challenge that McDonald’s face today is positive dietary change.
 For positive change McDonald should design nutrition messages that attract customer attention,
make sense, and encourage change in people attitude and behaviors audience is targeted by
scientifically practical and motivating manner.

43. CONT.
 To understand green marketing and ecologically responsible consumption.
 Environmentalism on the rise among the general public in 1980s
 The use-and-dispose philosophy at the core of McDonald’s business.
 In late 1980s, it reduced consumption by using lighter weight paper in straws, paper bags and other items and
recycled paper and cardboard packaging.
 In 1989, the company instituted a pilot program in 450 New England stores to recycle its plastic clamshells.
 In April, 1990, it committed $100 million budget, to buy recycled materials for restaurant construction,
remodeling, and operations under a program called “McRecycle”.
 In 1989 and 1990, McDonald’s bolstered its environmental management practices with a proactive public
relations campaign.
 In addition, McDonald’s worked with several different environmental and nonprofit groups (e.g., the World
Wildlife Fund and the Smithsonian Institution) to coproduce elementary school materials on the environment.

44. CONT.
 McDonald’s is trying to show consumers its “greener” side with marketing effort, “Global Best
of Green.”
 80% of packaging used by McDonald’s Europe comes from renewable resources.
 In Canada, switching from bleached white napkins to plain brown has saved $1.3 million annually
 U.S. restaurant locations recycle about 13,000 pounds of used cooking oil per year, on average.
 Using a fryer requires less oil allows restaurants to cook the same product with 40% less oil,
saving 4% in energy over other fryer models.
 U.S. locations completing an energy survey identify savings of $3,000-6,000. McDonald’s USA
recognizes “Energy All-Stars,”.

45. CONT.
 McDonald’s Mexico is testing solar hot water heaters in four locations to reduce the use of liquified petroleum
gas
 McDonald’s Sweden is using CO2 detectors in 24 restaurants to adjust ventilation systems reducing electricity
use 15% annually.
 McDonald’s Europe is serving salads in cardboard bowls instead of plastic dishes, and wooden coffee stirrers
instead of plastic.
 In the U.S., decreasing the weight of polypropylene cold cups has decreased costs by 6% and saved nearly
1,000 tons of resin.
 A variety of different waste and recycling bins have been tested in certain countries. A German model achieved
a 90% recycling rate.
 Restaurants in Switzerland feature a separate receptacle for organic waste, which is sold to Kompogas, which
ferments the waste into biogas.