McDonald's began as a barbecue restaurant opened by Richard and Maurice McDonald in 1940. Ray Kroc franchised their restaurant in 1955 and later bought the whole chain. McDonald's expanded aggressively throughout the US and overseas in subsequent decades. It now serves 70 million customers daily across 118 countries. McDonald's emphasizes quality, cleanliness, service, and affordability. It strengthened its brand through iconic products, marketing campaigns, and tailored offerings in different markets. McDonald's faces risks from competition and health concerns but maintains relevance through innovation.

1. cDonald’s Case Study

2. Inception of mcdonald’s
Richard and Maurice McDonald
started McDonald’s as a barbeque
restaurant in 1940
Ray Kroc, a multi mix salesman
franchised a restaurant in 1955 and
later bought the whole chain
Ronald McDonald, the world
famous mascot - introduced in 1960
Expanded to over 700 restaurants
in USA by 1965 - Aggressively
expanded overseas in the 80s
Added almost 2000 new restaurants
every year

3. Mantra for mcdonald’s initial
success – ray kroc
•Domestic and international
expansion reinforced with quality,
service, cleanliness and values.
•Iconic golden arch and red and
white stripe restaurants
•Menu expanded – iconic items – Big
Mac, Fillet-O-Fish, Egg McMuffin
•Ramped up advertising – targeted
children and families

4. the magnitude of mcdonald’s
McDonald’s serves 70 million people every day.
That’s 5 million more than the population of UK
World’s largest chain of restaurants.
118 countries – 34000 locations –
1.9 million employees
Generated revenues of $27 billion in 2012

5. Brand promise
Hot, high quality food at a great value at the speed
and convenience of McDonald’s
High Quality Great Value
Speed and convenience

6. Science behind mcdonald’s success
Customer service has
always been top priority
FOCUS:
•Consistency of quality
•Creating strong brand
equity through holistic
marketing activities
•Emphasis on cleanliness
and service
•Affordability of products
•Localized offerings
satisfying regional taste

7. Science behind mcdonald’s success
Quick Service Affordability

8. Science behind mcdonald’s success
Localized Offerings Quality Control

9. Creating Brand equity
Wide Array of Marketing Campaigns

10. Creating Brand equity
Adding more products to the product line.
Expanding beyond hamburgers. Brand extension.

11. Brand power
Regular food items tastes better
when wrapped in McDonald’s
familiar packaging
4th most valuable brand in the
world, valued at $85.7 billion

12. Marketing strategies
Marketing Segmentation
Psychographic segmentation
Demographic segmentation based on
income

13. Marketing strategies
Marketing Segmentation
India
China
Japan
Geographic segmentation
catering to needs of local market

14. Brand positioning
Family restaurant –
Ronald McDonald
Targets kids – Happy
Meals
Attracts teenagers and
young adults - $1 menu
Attracts health
conscious consumers –
Premium low calorie
salads
McCafe – targets
consumers in booming
coffee industry

15. What are McDonald’s core brand values? Have these
changed over the years?
Core values – quality, cleanliness, service
and value
Products, product pricing, restaurants
and employees showcase these values
Lost their way in the 80s and 90s due to
aggressive expansion
Devised a strategy to restore broken
brand promise
Strategy of 5P’s – people, product,
promotion, pricing and place.

16. How has McDonald’s grown it’s brand equity over the
years?
Brand equity has been created over the years
by:
• Holistic marketing activities
• Smart brand elements – Ronald McDonald
• Campaigns – I’m loving it, Closest thing to
home
• Overhauling restaurants and improving
services

17. Has McDonald’s changed in different economic times or in
different parts of the world?
o One of only two companies to
register increase in share prices
during worldwide recession
o Changes product line from country
to country based on local taste
preferences

18. Risks McDonald’s may face in future
Rising competition in
the market
Association with
obesity
Rapid expansion ->
deteriorating quality and
service

19. How to overcome those risks
Introducing healthier items
Study market risks and
avoid them by research
Innovate their product
line and marketing
strategy

20. SUMMARY
Richard and Maurice McDonald started the
company, Ray Kroc expanded it to several
countries. Now it has grown to be the world’s
largest restaurant chain with 1.9 million employees
Managed to create an international presence
Reputed for service and quality
Strengthened brand equity by product line
extension and various marketing campaigns
Adopted clever marketing strategies – market
segmentation – demographic, geographic,
psychographic
Faces risk from competition
Needs to continuously innovate and update to stay
relevant

21. Disclaimer
Created by Aniketo Ghosh, Heritage Institute of Technology, Kolkata
during a marketing internship under Prof. Sameer Mathur, IIM –
Lucknow.