British Food Journal,
Vol. 103 No. 2, 2001, pp. 97-111.
MCB University Press, 0007-070X
McDonald's: ``think global, act
local'' ± the marketing mix
Principal Lecturer, Manchester Metropolitan University,
Globalization, Marketing mix, Marketing management, Fast-food industry,
Focuses on the marketing mix of McDonald's. Highlights how the company combines
internationalisation and globalisation elements according to various fast food markets. Using the
effect of strategical and tactical models, the case illustrates the effect of McDonald's on the global
environment and how they adapt to local communities. Describes future franchise plans for
Two brothers, Richard and Maurice McDonald founded McDonald's in 1937.
The brothers developed food processing and assembly line techniques at a tiny
drive-in restaurant east of Pasadena, California.
In 1954, Ray Kroc, a milk-shake mixer salesman, saw an opportunity in this
market and negotiated a franchise deal giving him exclusive rights to franchise
McDonald's in the USA. Mr Kroc offered a McDonald's franchise for $950 at a
time when other franchising companies sold restaurant and ice-cream
franchises for up to $50,000. Mr Kroc also took a service fee of 1.9 per cent of
sales for himself plus a royalty of 0.5 per cent of sales went to the McDonald
brothers. The McDonald's brothers sold out for $2.7 million in 1961.
McDonald's first international venture was in Canada, during 1967. Shortly
afterwards, George Cohon bought the licence for McDonald's in eastern
Canada, opening his first restaurant in 1968. Cohon went on to build a network
of 640 restaurants, making McDonald's in Canada more lucrative than any of
the other McDonald's outside the USA.
The key to the international success of McDonald's has been the use of
franchising. By franchising to local people, the delivery and interpretation of
what might be seen as US brand culture are automatically translated by the
local people in terms of both product and service.
McDonald's now has over 20,000 restaurants in over 100 countries, and
around 80 per cent are franchises.
Globalisation versus internationalisation
Globalisation involves developing marketing strategies as though the world is
a single entity, marketing standardised products in the same way everywhere.
campaigns, prices and distribution channels for all markets. Brand name,
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