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Mcdonalds India. Porters Five Forces Model and Consumer Behaviour Analysis

Extracts from this document...

Introduction

Marketing Planning PGPM 2012-14, Term I Marketing Strategy Analysis ? McDonald?s India Submitted by- Group 5, Section C, PGPM 2012-14 12P133 - Apoorva Abhay Dave 12P145 - Lucky Sharma 12P146 - Manav Gupta 12P147 - Manoj Kapoor 12P149 - Mayank Bathla 12P150 - Mayank Sharma EXECUTIVE SUMMARY Purpose of the study: This report analyses the marketing strategy and position of McDonald?s India. For this purpose, SWOT analysis, PEST analysis, Porter?s five forces analysis and consumer behaviour analysis of McDonald?s India was done. The report also contains suggestions and foresights for McDonald?s India for improvement in their marketing strategy. Background scenario: As per estimates there are approximately 500,000 restaurants in India in the organized sector. Sales by Indian food service companies totalled Rs 350 billion in 2002. The organized sector is responsible for approximately Rs 20 billion worth of sales. Indian consumers spend only 2.4% of their food expenditure in hotels and restaurants (including on premises and take-out sales). In particular, Merrill Lynch estimates a growth in urban consumption at potentially 20% per annum in nominal terms (16% in real terms) for at least the next few years. In addition, higher disposable incomes among consumers particularly in the top 25 cities and the trend towards eating out are combining with growth in organized retailing to fuel growth in the foodservice sector. McDonald?s was one of the early entrants in this market and currently has over 250 restaurants across the country. SWOT Analysis: McDonald?s major strengths are its first mover advantage and innovative and adaptive work model and focus on customers? requirements. The main weakness of McDonald?s is its less variety of offerings which are not considered healthy. McDonald?s has a number of opportunities such as to widen its distribution network, introduction of healthier products and more variety of offerings. And the main threats to McDonald?s are the competition and changing market trend of health consciousness. ...read more.

Middle

high fat) foods. 4. With rising animal rights activism and increasing controversies related to beef/pork in food affecting the religious sentiments of Indians, more consumers are now inclined towards vegetarian food and moving away from non-vegetarian food. ________________ Technological Factors: 1. With technological advancement, the cold storage systems have become easily available. Restaurants will benefit from this as they can easily store their inventory and decrease the wastage of perishable raw materials. 2. Better transportation options being available now, restaurants can easily transport the raw materials and inventory from cold storage to their outlets. 3. With increased scope of television, radio and internet, companies have greater reach to customers which can be utilized by more efficient advertisements and marketing. 4. Technological advancement have enabled companies to take orders online from customers and procure raw materials through e-procurement portals leading to lower costs of supply chain. Also, higher standard of technological factors will be beneficial for maintenance of higher quality levels. ________________ SECTION ? 2 Porter?s Five Forces Model and Consumer Behaviour Analysis Count of words: 903 Section ? 2 Porter?s Five Forces Model: Competition: Restaurant industry in India is highly competitive. There are a number of restaurants in India and the competition for fast-food segment is higher than rest of the industry. There is a threat from entry of new fast-food chains like Burger King in this market which already has cut-throat competition from existing players. Although there is a substantial unorganized sector in the industry but the main competition is from the organized sector which has large corporations that run a number of brands at multiple locations. The local players give competition but only in one locality but these large corporations with their pan-India presence and high level of marketing are leading to severe competition within the industry. ________________ Threat of new entrants: Fast-food industry works on the concept of convenience and it will be fairly easy for any local player to enter the industry. ...read more.

Conclusion

________________ Conclusion In this study, we have analysed the marketing strategy of McDonald?s India. The study comprises of SWOT analysis, PEST analysis, Porter?s five forces analysis, analysis of consumer behaviour through survey and analysis of McDonald?s positioning strategy. The results of SWOT analysis showed McDonald?s as a strong company with more strengths than weaknesses and a greater number of opportunities as compared to threats. With the strong position in market, McDonald?s has been able to tackle competition, its biggest threat, very well. Large number of opportunities reflects McDonald?s great scope of growth which it can achieve due to its strengths. PEST analysis showed that the environment for McDonald?s India has been really favourable and it continues to be so. With no restriction on investment and increasing disposable income of consumers the path for McDonald?s growth has become clearer though there are some road-bumps like changing to the societal tastes and preferences like health consciousness and vegetarianism. Porter?s five forces analysis indicated that owing to severe competition, there is high threat of substitutes and new entrants in food industry. Though McDonald?s has brand recognition and differentiated offerings and no other large competitor in burger category, but still the high buyers? power forces it to be innovative and to meet customer expectations. McDonald?s can exercise its power on its suppliers and can easily adapt itself to changing social and technological environment. Consumer behaviour is in favour of McDonald?s and more customers can relate to the brand McDonald?s and hence, they prefer its products. They have few expectations from McDonald?s and for meeting these we have provide few suggestions to the company in this report. McDonald?s has well positioned itself in the market. It has communicated its philosophies very well through its marketing strategy and also through delivery of service. It is a very distinct fast-food chain that provides food for which the purchase and consumption both are fast. High standards of quality and taste have complemented its marketing techniques to position itself as a great and real fast-food company. ...read more.

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