4-Ps in McDonalds
One of the aims of McDonald’s is to create a standardized set of items that taste the same whether in Singapore, Spain or South Africa. McDonald’s learned that, although there are substantial cost savings through standardization, being able to adapt to an environment ensures success. Therefore the concept of “think global, act local” has been clearly adopted by McDonald’s.
Adaptation is required for many reasons including consumer tastes/preferences and laws/customs. There are many situations where McDonald’s adapted the product because of religious laws and customs in a country. For example, in Israel, after initial protests, Big Macs are served ...view middle of the document...
McDonald’s has realized that, despite the cost savings inherent in standardization, success can often be attributed to being able to adapt to a specific environment. This is indeed the case with its implementation of its pricing strategy, which is one of localization rather than globalization.
McDonald’s has had to come up with different pricing strategies for different countries. More importantly, rather than just having a different pricing policy for the Big Mac, McDonald’s has had to select the right price for the right market.
Promotion, or the marketing communications mix, was seen by Kotler (1994) as consisting of five major tools:
(2) Direct marketing;
(3) Sales promotion;
(4) Public relations and publicity; and
(5) Personal selling.
Using these tools, McDonald’s looks to localize its marketing communications strategy as it needs to consider the enormous range of cultural and other differences that it would be faced with in each country (Web, 3). It needs to analyze consumers’ attitudes towards its product, usage patterns and ethnic, moral and religious considerations in that environment. Although the idea is to promote McDonald’s as a global image, McDonald’s focuses on the needs of the communities they are entering. In a communications context, the maxim “brand globally, advertise locally” (Sandler and Shani, 1991) is the McDonald’s promotional strategy.
After analyzing the marketing mix of McDonald’s, it is clear that the company can be said to be `global’, i.e. combining elements of globalization and internationalization. McDonald’s have achieved this through applying the maxim, `think global, act local’ (Ohmae, 1999), to all the elements of the marketing mix.
Explanation of the Above Example
Marketing Mix Paper
McCarthy (1975) formulated the concept of the 4Ps - product, price, promotion, and place marketing mix. For many years these have been used as the principal foundation on which a marketing plan is based.