What we can learn from McDonald’s Global Strategy

A cup of rice with chicken, ginger, onion, shallots, and chili peppers. A fried patty made of potatoes, peas, and spices, topped with tomatoes and vegetarian mayonnaise. Grilled chicken in pita bread with lettuce, tomato, onion, and tahini sauce. English muffins topped with refried beans, white cheese, and salsa. Breaded chicken covered in guacamole. A deep-fried roll of beef ragout. Lamb wrapped in Arabic flat-bread with shredded lettuce and tomatoes. A sandwich made of grilled salmon and dill sauce.

To the delight of many Americans and to the dismay of many others, the golden arches of McDonald’s appear throughout the world. But the menu items vary greatly. Go to a McDonald’s in Singapore, and you can order jasmine tea and a Shaka Shaka Chicken, which you create by dumping spice powder into a bag and, with a quick “shaka” of the bag, coating your chicken patty in local spices. In Spain, you can actually buy the country’s chilled soup, gazpacho, at McDonald’s, where it is served in a carton. In Brazil, you’ll find McDonald’s filling that rectangular apple pie crust with bananas instead.

The burgers that made McDonald’s famous also vary tremendously by country. Head to Japan and you can order a Koroke Burger, which consists of mashed potato, cabbage, and katsu sauce. In Hong Kong, you’ll find a burger that is served not between sesame seed buns, but between rice cakes. In Malaysia, you can order a Double Beef Prosperity Burger, which features spicy black pepper sauce. In Italy, the burgers come with pancetta and usually are on ciabatta rolls. Visit India, where eating beef is against religious rules for about 80% of the population, and you won’t find any beef burgers on the menu whatsoever.

In Germany, you can pick up a McSausage Burger. In Greece, a Greek Mac. In New Zealand, a KiwiBurger. In Costa Rica, a McPinto Deluxe, with rice, beans, and plantains. In Thailand, a McSamurai Pork Burger. Head to the United Kingdom around Christmastime, and you can order a mincemeat and custard pie for dessert. When in France, you can order Le McWrap Chèvre, a goat cheese wrap. In Argentina, you can have wine with your McDonald’s meal; German outlets of McDonald’s sell beer; in Israel, kosher food is served; and in Hawaii, you’ll be handed Spam with your breakfast. How’s that for contrast?

There are  five important lessons we can take away from McDonald’s global success:

  1. Don’t confuse your brand with your products.  While it’s true that the McDonald’s brand is strongly associated with hamburgers, this has not prevented the company from dropping all meat from some local menus. McDonald’s announced that it will open up its first vegetarian restaurants in India, a nod to the dietary preferences and religious beliefs of local customers.
  2. Figure out which products have international appeal.  It’s quite likely that some of your products might be desirable in every market, as McDonald’s has found. Some of the company’s products, such as its fries and shakes, stay consistent at most of its global locations.
  3. View a new market as a chance to take on new brand attributes.  While McDonald’s is known for its affordable fare in the United States, in many countries with a growing middle class, it can actually be a status symbol to be seen eating there.  Don’t assume that just because your brand has negative aspects in one market that it will necessarily carry them into another.
  4. Remember that “small markets” may very well define your future. Many companies make the mistake of only focusing on major world economies. McDonald’s is a global company, but about 70% of its revenue, which normally tops $20 billion annually, comes from restaurants in Australia, Canada, China, France, Germany, Japan, the United Kingdom, and of course, the United States. Paying attention to those countries that “only” make up 30% of the company’s revenue is a wise move. As their spending power grows, so too does their share of the pie.
  5. Let your customers tell you what they want. McDonald’s did not come up with all those adapted product offerings in isolation from its customers.  Rather, the company observed the behaviours of customers in these local markets and packaged their products in ways that would seem local and familiar. When was the last time you adapted a product for a new market based on in-country customer feedback?  You should.

Reblogged from HBR Blog Network

McDonald’s’ Local Strategy, from El McPollo to Le McWrap Chèvre

by Nataly Kelly  |   1:00 PM October 8, 2012

For Global marketing training, email Chipo at chipomaps@gmail.com

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About chipomaps

A brand reputation, marketing and new media trainer and consultant. Constantly curious, constantly learning.
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