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In business marketing, there are three competitive strategies that businesses implement: focus, differentiation, and cost leadership strategies (FrogDog Magazine 2014). Thus, “Pricing strategy is one of the most significant aspects when it comes to marketing”. According to Euromonitor International and Credit Suisse Emerging Consumer Survey, on average a household in India spends about 23 percent of their income on food and beverages, while people in the U.S spend less than 15 percent. Most Indian families tend to devote less than ($11) for food, as an effect, they opt for low price food.
As a result, widespread success and flourishment of McDonald’s in India can be credited to its pricing strategy which was developed to attract the middle and lower class. “The basis of McDonald’s success is serving low priced value-oriented product fast and efficiently in clean and pleasant surroundings” (Ray Kroc, Former Senior Chairman). Mcdonald’s pricing strategy in India was different from other countries, they offered low prices for their fast food, and this won fans for McDonald’s India.
Moreover, McDonald’s also provides price bundling, where combo meals and family deals are available for a discount; this affordability attracts the broadest number of clienteles. They even combine psychological pricing and price bundling where they use prices that seem more affordable to the eye and mind such as $.99 instead of rounding it to a dollar (Meyer 2015). This encourages customers to buy more products. The menu even provides various prices from higher-priced items to lower-priced items to cater to consumers that hold diverse price perceptions.
For example, the McVeggie and McChicken burger cost approximately 50-60rupees while the McAloo Tikki and Chicken McGill cost 20-30 rupees (Wells 2020). It further strengthened the brand affordability mantra by presenting a 25-rupee Happy price menu.
According to Hofstede culture is “the collective programming of the mind which distinguishes the members of one human group from another”. Culture is essentially the differences amongst groups where people have different languages, communication, beliefs, and values. These factors of culture influence India consumer’s brand choice therefore successful businesses keenly incorporated the dimensions of culture such as collectivism or individualism; or special catchphrases and language into marketing.
“Good marketing makes the company look smart, great marketing makes the customer feel smart” (Joe Chernov). McDonalds uses this aspect of culture through various digital marketing to attract the nation of India. India is a country where families place an integral role. The main focus isn’t individualism like in the United States rather it is collectivism (Hofsetede,1980; Das,1993; Rose Dalakass and Kropp,2003). In Indian society, an individual isn’t seen as a separate entity rather part of a group or an entire community. According to (Roth 1995) customers that are part of a collectivist nation, find brands that implement the ideals of family, friends, and group connection and affiliation more striking.
As a result, McDonald’s is promoted as a family-oriented restaurant. Arvind Singh stated, “The first Indian Tv commercial, Stage fright attempted to establish an emotional connection between (Indian) family and the brand” (Marwah Nishu 2017). There are digital marketing advertisements that are family-centric seen on television such as “McDonald’s mein hai kuch baat” this phrase is used in ads to imply that Mcdonalds is a special place for families to bond over the dinner table and celebrate by socializing. Another catchphrase used in advertisements in India to depict the collectivism dimension is “To aaj McDonalds ho jahyaye” this phrase suggests that McDonald’s is a great dwelling for families to enjoy and have fun.
Moreover, their corporate culture is a family happy culture which emphasizes happy culture from the mascot, Ronald McDonald, which is their” Chief Happiness Officer”, happy meals, and iconic Golden arches logo. McDonald’s emphasizes their attention to children. They offer cute “happy meals” with toys inside them, they built “happy lands” inside restaurants so children can play in them and be entertained. Why does McDonalds focus on children? Seema Arora Nambiar, senior vice president, strategy, innovation, and capability in India stated: “Since the launch of the iconic Happy Meals in India in 1997, it has grown in popularity. The toys that our customers have collected bring back the happy memories created over food. We wanted to celebrate the emotional connection that our customers have with the brand through their Happy Meal toys” (Srivasta 2018). This is a strategy they use they focus on children to attract more families. Also, they focus on children so the children can associate McDonalds with happiness and build brand loyalty tirelessly, so when they grow up, they still relish McDonalds and subordinate happy reminiscences. McDonalds isn’t just thinking about the present day but also the future. It can grow upcoming generation customers by concentrating on children at the moment.
This chain is not only a fast-food restaurant, it has impacted numerous lives, rather it is a global icon and cultural symbol that affects the lifestyle of people. In the United States, McDonald’s is viewed as an eatery that provides fast food and fast food is a representation to be Americanization of the régime. In America, 85 million people eat fast food every day according to CBS News. According to Kirsten Herrick, one of the researchers at the National Center for Health Statistics says” Fast food consumption has been a part of the American diet for a while” (Sathl Stephanie 2018). Fast food is known to be American culture. In fact, the United States is the home country of McDonalds, because the first store opened in 1940 in San Bernardino, California. In today’s day, Mcdonalds in the United States has the largest number of restaurants, approximately 14,000 stores. But how is this chain so successful in the United States?
Well according to Sarah Ohle, xAd’s senior director of global research” A lot of it comes down to the sheer number of business locations” (Business Insider 2016). With so many chains “Americans are never farther than 15 miles from a Mcdonalds, while many cities have several chain outlets within driving distance”. That’s is true in the United States there are numerous stores of Mcdonalds that are so close and convenient for the average American to drive pass and to the drive thru. It is also known as the biggest employer for the country where 420,000 employers in 2014. In fact, according to the novel “Fast Food Nation,” approimatley1 in 8 Americans have been employed by the chain. It is also successful because it fits with American lifestyle, Kirsten Herrick states that:” with today’s lifestyle, fast food is an easy option that people choose” (Sathl Stephanie 2018). Fast food is known for its convenience and known to fit in America’s workaholic lifestyle.
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