Cultural differences in international marketing: Where's the beef? McDonald's sells hamburgers in a Hindu country

Résumé du document

The first McDonald's restaurant opened on 15th April 1955 in Des Plaines, Illinois, U.S.A. and after 50 years down the line, the company is the world's largest food service system with more than 30,000 restaurants in 100 countries, serving more than 46 million customers every day. McDonald's opened its doors in India in October 1996. Nowadays the company has restaurants all over India: Mumbai, Delhi, Pune, Ahmedabad, Vadodara, Ludhiana, Jaipur, Noida, Faridabad, Doraha, Manesar and Gurgaon. McDonald's in India is a 50-50 joint venture partnership between McDonald's Corporation and two Indian businessmen Amit Jatia and Vikram Bakshi, who share McDonald's complete commitment to Quality, Service, Cleanliness and Value (QSC&V). Having signed their joint-venture agreements with McDonald's in April 1995, they trained extensively, along with their Indian management team, in McDonald's restaurants in Indonesia and the U.S.A. before opening the first McDonald's restaurant in India.

Extraits

[...] To finish, much of the McDonald's growth in India can be attributed to its pricing strategy. Clearly, the McDonald's strategy has been to increase sales volume of its products by making its products available at an affordable price, for an Indian middle class who remains very price- sensitive. McDonald's has worked with local Indian suppliers to consistently improve the quality and increase greater yields of agricultural products. Such meticulous planning in setting up a well- coordinated supply chain system has paid rich dividends to the McDonald's operations in India. [...]

[...] English is also spoken, especially in urban areas and among the better-educated component of the population. Since it's difficult for firms to have a global and standardized strategy of set up on the Indian market. Moreover India is since long time known because of its caste system, which is a religious way to rank people. They believe that if you live a good life then you will reborn higher in the caste system. Today the caste system is vanished but still people live with it. [...]

[...] Approximately 75% of the menu available in McDonald's in India is Indianized and specifically designed to Indian customers. Besides with two local managing directors (Bakshi and Jatia) playing critical roles, McDonald's took a series of politically correct strategies to deal with the initial challenges of the Indian market. McDonald's typically employs local people, and the average McDonald's restaurant in India employs more than 100 people in all kinds of positions. And every expansion also brings additional income and employment opportunities to India's agricultural work force, which is very pleasing to government officials. [...]

[...] Considerable inefficiency in the food distribution system cuts farmers' income while raising consumer food prices. Moreover executives at Mac Donald's were aware of India's deep suspicion of foreign companies. India's sensitivity to cultural imperialism, the so called Western cultural domination over Indian values, traditions, religious beliefs, customs, and food habits, made the entry of foreign multinational corporations, particularly in the food industry, difficult. And in India, there is a vocal group of environmental and animals' activists who oppose the entry of fast food chains like Mac Donald's. [...]

[...] However, it is too early to say that McDonald's has succeeded in India. Nine years after McDonald's first set up in India, the burger giant has yet to make any net profit. Therefore, its growth in India remains uncertain. Indeed McDonald's is more than just another American fast food chain. It carries a symbolic load of Americanness—American variant of capitalism and its overwhelming domination over the global economy. It is also a symbol of American cultural imperialism. For this reason, McDonald's operations in India, like other parts of the world, will continue to face opposition from religious fundamentalists, environmentalists protectionists, animal rights activists, and anti globalization protestors. [...]