- McDonald's entered the Indian market in 1996 to capitalize on its huge potential, but faced significant cultural sensitivities. - Economic liberalization in 1991 opened India up to foreign investment after a balance of payments crisis. This attracted McDonald's. - McDonald's rollout strategy emphasized local management, avoiding religious issues, and equal employment. It focused on adapting products, prices, locations, and promotions to Indian culture. - To overcome sensitivities, McDonald's tailored its menu, made items more affordable, located restaurants in family-friendly areas, and promoted through culturally-appropriate advertising. - Positioning itself as a family and child-centric brand helped McDonald's succeed in India by catering to the cultural importance

1. Principles of Business
Seminar: McDonald’s in India
Topic Number: 14

2. Overview
In 1996, McDonald’s opened its first restaurant in India in a
bid to capitalise on the huge potential of this marketplace.
Since then they have been on a significant growth trajectory
opening hundreds of stores across India. However, their path
was not easy and they have learnt a number of significant
lessons along the way about launching into an international
market such as India.
In this seminar, we will explore how McDonalds was able to
move into the Indian market and achieve profitability. We will
initially look at the economic and political rationale for
McDonalds to enter the Indian market. This will be followed
by an analysis of their roadmap into India.
We will explore how they developed their strategy looking
particularly at how they overcame a number of cultural
sensitivities they were faced with. Finally, we will explore why
they positioned themselves as a family and child centric
restaurant in India.

3. 3
Learning outcomes of this seminar
• Determine and describe the economic and political
rational for McDonalds to enter the Indian market
• Articulate their roadmap to launch and grow
• Critically evaluate and articulate how they overcame a
number of cultural sensitivities they encountered
• Justify why they positioned themselves as a family and
child centric restaurant in India

4. Agenda for this seminar
Explain the economic and political circumstances that attracted
McDonalds to India
Explain the roadmap and key considerations McDonalds had when
moving into India
Explain the steps they took to overcome a number of these cultural
sensitivities
Critically evaluate how they positioned themselves as a family and
child centric restaurant in India

5. Structure for the session
You will have
15 minutes to
discuss each
question
We will have a
de-brief at the
end of each 15
minutes to hear
your thoughts
on each area
Feel free to ask
questions but
please do not
have separate
conversations
‘we are all in
this together’!

6. McDonald’s in India: The Skeptics
India has a very ancient food
culture. We are not going to
change to American patterns of
consumption. McDonald's will
never become part of mass
culture in India because most
people can't afford to eat there
Vandana Shiva, Director of
the Research Foundation for
Science, Technology and
Ecology

7. And yet…

8. …So why have they been successful?
View video: http://www.youtube.com/watch?v=8TbiaEuAReE

9. Explain the economic
and political
circumstances that
attracted McDonalds to
India

10. Economic Liberalisation in India: Start of the
McDonalds journey
Economic liberalisation is generally defined as the loosening of
government regulations in a country to allow for private sector
companies to operate business transactions with fewer restrictions. In
relation to developing countries, this term refers to opening of their
economic borders to multinationals and foreign investment.
Why did this happen in India in 1991?
A balance of payments crisis
in 1991 which pushed the
country to near bankruptcy
India central bank had refused
new credit and foreign
exchange reserves had
reduced to the point India
couldn’t finance 3 weeks
worth of imports
The Rupee devalued and
economic reforms
No FDI & FII Investments

11. India’s Economic Profile
Source: i-pri.org

12. India’s Economic Profile
Source: www.csumba.org

13. Explain the roadmap
and key considerations
McDonalds had when
moving into India

14. Key Milestones
Source: McDonalds, 2014

15. Key Milestones
Source: McDonalds, 2014

16. Key considerations – Emphasis on
local management
Source: The Times of India, 2013

17. Key considerations – Politically Correct Strategy
How to avoid religious
sensibilities?
How to avoid political
confrontations?
Source: McDonalds, 2014

18. Key Considerations – Equal Employment
Source: McDonalds, 2014

19. Key Considerations – Giving Back
Go Green Traffic Safety
Civic Voting World Children Day
Illustrations: Wikipedia, 2014

20. Explain the steps they
took to overcome a
number of these cultural
sensitivities

21. McDonalds in India: McProduct
Source: McDonalds, 2014

22. McDonalds in India: McPrice
Source: McDonalds, 2014

23. McDonalds in India: McPlace
Source: McDonalds, 2014

24. McDonalds in India: McPromotion
View video: http://www.youtube.com/watch?v=21wsqNqqqsg

25. McDonalds in India: McPromotion
Source: McDonalds, 2014

26. Critically evaluate how
they positioned
themselves as a family
and child centric
restaurant in India

27. McDonalds The Family Restaurant
Source: McDonalds, 2014

28. What makes India unique?
Focus on
extended family
Children center of
household
Busy
professionals
Source: McDonalds, 2014

29. Family Initiatives
Source: McDonalds, 2014

30. Family Initiatives
Source: McDonalds, 2014

31. End of Seminar
Note: This recording is for your
personal use only and not for further
distribution or wider review.
© Pearson College 2013