Macdonald's Advertising and Culture - Case Study Example

Specialty: Year: Paper Macdonalds Advertising and Culture Paper on: International Business Supervisor: Submission Date: Contents Paper Title: Macdonalds Advertising and Culture 1 Executive Summary 3 Introduction 3 Investigation, analysis, and interpretation of the core issue 5 MacDonald’s advertisement in America and how it related to American culture 5 MacDonald’s advertisement in Asia and how it related to Asian culture 8 MacDonald’s advertisement in Europe and how it related to European culture 11 Conclusion and Recommendations 13 Works Cited 16 Executive Summary McDonald’s has started off its business operations as serving hamburgers. The company through its unique strategies has been able to expand into 119 countries. However the strategy that the company has adopted is different in different cultures. The company takes very effective measures in clearly analyzing and identifying cultures prevailing in various regions it operates and designs all its promotional techniques based on the culture of the country so that the majority of the population can quickly relate to such advertisements. The company has different forms of advertisements in Asian countries compared to that of America as the culture of these two countries is very much different where culture in Asian context is more inclined towards saving money and spending quality time with family on the contrary in American context the culture is more of individualistic where the people intend to enjoy their life more in comparison to saving money or looking for affordable price menu. Similarly in European context the culture that mostly prevails in all of its regions is to have a healthy lifestyle and to dine at places with friends or family that are more sophisticated. This culture has made the company advertise its newly designed restaurants for its European customers so that it can drive in more of customers and hence more profit margins. Hence the company has tried to adjust itself as per different cultures in different regions in order to sustain its business operations. Introduction The McDonald’s Corporation forms the biggest chain in the world that deals in hamburgers. The company operates in over 119 countries and serves approximately 68 million customers across the globe daily. The company had been initially started as a barbecue restaurant. The owners of this restaurant were Maurice and Richard McDonald. Later the business was restructured in order to form a hamburger chain following the various principles of the production lines. The company has expanded its operations into many locations and majorly its revenue comes from the royalties and the fees that are given by the franchisees through which it operates and even through the sales revenue that is contributed by those restaurant chain that are owned by the company. Over the years the company has been able maintain very profitable advertisement campaign and apart from using the traditional media it also incorporates other forms of media platforms such as billboards, sponsoring various sports events, signage, and even highlights its logo in all kinds of special events. However the core advertising medium for the company has been television. The company has adopted different slogans for different countries and its promotional techniques largely depend on the culture in which it runs its business operations. This research study is mainly to analyze the three different cultures of Asian market, American and European market and how these cultures had an impact on the advertisement campaign being launched by McDonald’s. The study comprises of a thorough analysis of the link between the culture of a country and the advertisement campaign undertaken by a company. The main strategy of McDonald’s was to fit into different cultures and offer the consumer market what they actually demanded. The company incorporated a lot of flexibility in its business operations so that they can easily accommodate the cultural differences in which ever country they operate. Their strategy even involved a diversified product line as per the taste and preferences of the consumer market. In today’s competitive scenario one of the most important macro environmental drivers that have an impact on the business operations is culture. Culture of a particular country differs from the other and it can be defined more of civilization stage that is possessed by a particular nation or country. Culture of a country is established by an individual and the level of education or training that is imparted on those individuals. Culture develops desires in individuals which later gets converted to demand and triggers business opportunity for many companies. Culture mostly relates to the beliefs and behaviours that form the basic characteristics of an individual. Culture plays an affective role in the rise or fall of an economy. International business does not only deal across various national borders but also operates across cultures. Culture majorly influences the way people communicate, behave and think. Culture also affects the way in which the transactions are done by a company and even the level of negotiation done by the company so as to operate across diverse culture. In order to meet the various cultural differences across the borders international business enters into two forms of negotiations either through a process in which there is a win-win situation or through a struggle stage in the initial phase where there is a win-loss situation. The marketing communication approaches across various cultures also differs by international business in some culture the focus is on direct communication and in some other countries focus is on indirect way of communication. The international business expansion of many companies mainly relies on three differ aspects such as to think about the culture in which it operates, think more on a global scale, and be more of a cultural and global thinker in the same time period. In order to gain expertise across various cultures the companies encompasses more of diverse workforce who has a clear understanding of varying cultures across the borders. McDonald’s over the years has expanded its operations across various countries and has also been able to maintain a standardized approach in relation to the various local traditions. The company launches unique product range as per the cultural trend in whichever region it operates such as McShawarmas in Israel, and Bulgogi Burgers in South Korea. The company innovate recipes so as to meet demand across various cultures and it does not standardize its product line across all countries. The operations of McDonald’s have a direct influence in various cultures as it operates across different countries. It adjusts its operations and restructures its marketing mix as per the culture so as to be aligned with the significant culture of the country. The company even undertakes some form of advertisements in some particular country which has no relevance in a different country. The company promotes McLobster only in some of its stores across the world. The company has been able to effectively manage its operations across the globe and fits into different cultures mainly because of its feature of quick adaptability and flexible organizational structure. Investigation, analysis, and interpretation of the core issue MacDonald’s advertisement in America and how it related to American culture Fast food is a major cultural element across the American market. It is such a concept that gains its importance in every age group such as younger as well as older generation. The fast food restaurants are considered by the teenagers as the most convenient food item in terms of price, later on it is regarded by the younger generation as an efficient substitute for cooking, and finally at the later stage it is regarded as the most preferable food item for lunch and dinner. The culture of America has been more over predisposed to form a fast food nation. The Asian culture is more of family oriented but on the contrary the American culture can be related to more of an individualistic approach and because of this culture that prevails in this country the majority section of people live alone more or less from their teenage (BloomBerg Business Week Magazine 45).This culture gives rise to a vast opportunity for all the fast food restaurant chains like that of McDonald’s. McDonald’s has been proved to be the icon for the cultural power of America. Food has been the underlying element that defines culture of a country and so has it has done for America. The culture that prevails in America are more inclined towards eating wide variety of foods that may not be so nutritional but needs to be tasty so has to satisfy the taste buds (Kahn 175). The love of American people towards fast food and the changing trend of eating habits of American citizens has contributed towards success of McDonald’s and even triggered the company to launch new ad campaigns and innovative product lines for all its food lovers of America. The company has launched commercials and ad campaigns through billboards, leaflets, sponsoring events where it related its product items as “fast food – way of living”. The American culture considers food more of necessity in comparison to other cultures and tradition that considers such fast food centres as a social gathering and more of dinning with family and friends. The American culture relates more to enjoying life to the fullest and even highlights more of leading a happy life, superior life, and to love the life they live. Such a culture has resulted into the slogan for all the advertisement campaigns of the company that is “I’m Lovin It”. Through their advertisements they indulge into developing emotional bonds with their customer so that they can enjoy their food at McDonald’s and even come back to dine at the stores over and over again. The various regions in America comprises of United States, Cuba, Costa Rica, and Canada where the company advertises its product lines very differently. The culture of these different regions is very different from each other and over the years the company has been able to adapt to such cultural differences. For instance in United States the culture is more inclined towards quality food and they love to enjoy life and are not bothered about prices of such products. This culture is well seen in the advertisements of the company as they promote wide array of food items through commercials and social networking sites. In Cuba the inclination is more towards beverages which has made McDonalds advertise itself as a brand providing innovative juices and drinks as per the preference of their customers. In Canada the culture of true value for money can be well depicted in their product line advertisements as they promote more of items in least cost possible. On the contrary the culture of Costa Rica is trying unique products which have made the company to promote itself as a fast food restaurant that operates on the tastes and preferences of their customers. The company has implemented various ads that are more focused on minority groups and it even sets lower prices for all its product line so that it can attract it a large consumer market. The company has already started advertising new drinks such as mochas, and even coffees in all its ad campaigns so that the people are aware that they get a wide array of food items at McDonald’s (Dransfield 104). The culture of America is more aligned towards trying new innovative products that are according to their taste and preferences. This cultural aspect been observed in all its advertisement campaign across American region. The ads mainly focus on delivering better deals to its customers. The common form of advertisement that is undertaken by the company is in the form of TV commercials which is aired across twelve months. The recent advertisement that was aired by the company was ‘Big Day’ that highlighted American and African wedding and the boy in the ad was getting bored in traditional wedding procedures and then he gets highly enthusiastic when he finds “Happy Meal” being offered by McDonald’s. The culture of America is very thoroughly examined by the company because this was the main region of its business operations. The main cultural behaviour is that they are more inclined towards try the best and tasty food products and are not much concerned with the sophisticated nature of the restaurant in which they dine. This was the major area that was highlighted by the company in every aspect of their advertisement. McDonald’s sustains its market position in this region by offering a wide range of products according to the taste and preferences of the Americans. (Kincheloe 129) The above advertisements state the fact that the company had analyzed the demand of the consumer market towards innovative product lines and it offers such product range at the lowest prices. In order to satisfy the demand of American consumer market the company even advertises on websites, billboards, and even in some daily newspapers there new product items manufactured only for the American locals. The company down the lines has been able to respect the culture of America that highlights more of value for money and tasty food products as it forms a part of necessity for the American market. The company also takes into considers the taste and preferences of the consumer market that are more aligned towards less spicy and more of vegetables, toppings, cheese, etc., and so it has been effective enough to offer some of the best products to the American market that is not found in any other region across the globe. MacDonald’s advertisement in Asia and how it related to Asian culture The entry of McDonald’s Corporation into a completely new market such as that of Asia was more of a continental push that resulted into its expanded business operations in the Asian market. The company has entered into the markets of Japan in the year 1971 and it gained its importance at a much later stage in other Asian markets. The arrival of this company into the Asian market was a kind of symbolic event as the Asian culture relates Golden Arches to more of modernization and westernization of the market. When the company had opened its franchisee stores in China it was more of fanfare and thousands of customers lined up in front of the franchisee store so as to experience the flavour of new cuisine that was being offered by the restaurant chain in Asian market. The promotional technique that was adopted by the company was very strong in this market that considered it to be not just any other restaurant in the fast food industry. The symbols that were used by the company f or its advertisements carried a lot of weight that was not possible to be ignored by any individual with any cultural background in the Asian market. The company had recognized the fact that there advertisement of fast service and better prices would prove to be very advantageous in the Asian market. On the other hand the franchisees of McDonald’s in the region focused more on packaging as per the cultural trends in the Asian market. The Asian market was not a fast paced market in comparison to United States and hence it required more of restructuring in the advertisement campaign that was undertaken by the company in other regions of its business operations (Schnaars 166). With time the company has been able to succeed in a rapid rate and it has been proved through its phenomenal expansion across various regions in the Asian market. The company has opened its first store in Hong Kong in the year 1975 and since the company operates across the entire market with a total of 125 outlets. The company focused more on the traditional values of the Asian culture and had incorporated a common objective in all of its advertisements and promotions that highlighted family, goodwill and children. As an advertisement campaign in Beijing McDonald’s adopted the slogan of “Get together at McDonald’s; enjoy the happiness of family life”. The four main countries in Asia where the company has been able to establish its operations mainly comprise of India, Sri Lanka, China and Japan. In the Indian context the culture is more inclined towards getting tasty food and at a reasonable price. This has enforced the company to restructure its pricing strategies and it now promotes more of economic meals where people can enjoy food along with their family at an affordable price. The main platform of advertising that has been adopted by the company is through television. In China since the culture likes more of spicy food the company promotes its product line as per their taste and even keeps their restaurants open 24x7. The culture of Japan is to enjoy healthy food and get a warm and friendly customer service. This is the main aspect in the company’s advertisements in the country where they promote their service as the friendliest one for the people in Japan. In Sri Lanka the culture is slightly different where the people majorly enjoy more of non vegetarian items in their appetite and to be successful in this market the company has adopted specific product line and advertises itself as delivering the best quality food at a competitive price. The culture of Asian market pays more importance towards spending quality time with their family and all of the company’s logo had taken this aspect into consideration. Where the advertisements reflected that having a meal at McDonald’s is more of spending some quality time with family after a busy schedule. The company promoted all its stores as ‘family restaurants’ so as to achieve harmony and domestic unity. This made the franchisee stores not only to be appealing to children as Westerners but also to the older generation with basic traditional values and beliefs (Allen 213). There are even other ad campaigns that were aired on television such as an aid campaign launched in Singapore that highlighted enjoying their meals at the restaurant comprising of all three generations. Some other advertisement campaigns that was launched by the company in the Asian market has been given below. (Watson 189) The company uses more of billboards and TV advertisements in order to promote its products and services in the Asian market. The ad campaigns as reflected in the above diagrams clearly illustrates that the company analyzed the culture of Asian market that is more concerned towards value for money, quality food and spending time with family in a pleasant ambience. The consumer perception of Asian market towards the brand is related to traditional preservation and even links it with family values thus naming it a family restaurant. Through its effective ad campaigns the company has been able to fight the cultural restrictions of the Asian market that regarded McDonald’s as an American Juggernaut that entered into the market to erode the Asian cultural norms (Chai 173). The advertisements of the company focused on target market that was children and established itself as a media of inter generational harmony. The further extended promotional techniques of the company comprised of giving gifts and arranging games for children so that they feel the warm and family culture at McDonald’s. However down the line the traditional look of all its advertisement campaign has been restructured where the focus has shifted from grandmothers to that of youth generation giving all its franchisee stores a cool and a hip look. On the contrary the advertisement slogan of the company ‘I’m Lovin’ It’ has been standardized by the company across all the regions of its business operations. MacDonald’s advertisement in Europe and how it related to European culture McDonald’s has its business operations expanded into distinct geographic segments and it was able to open its first store in the European market in the year 1971 and that was primarily in Netherlands. In the present scenario the franchisee stores along with McDonald’s Europe operates in over 40 countries and has a store base of 7000 restaurants serving daily approximately 13.6 million customers. The company has been operating in Europe from the last twenty years but it has not been able to set up its organization in France as it holds only a few scattered stores. Europe by far is considered to be the most profitable region of the business operations of McDonald’s Corporation. The European market denotes the largest revenue generator amongst all the markets where the company operates through franchisees or its wholly owned stores. In today’s scenario the company has is having sizzling business operations in European market and as per analysis the fast food restaurant industry of Europe has more growth and scope in relation to that of American market. The cultural trend of the European market is more inclined towards having a splendid experience in the restaurant in comparison to wide range of food items. The main focus of the company in the European market has been to design the Golden Archs in such a way that it becomes the most preferred location for the Europeans to spend their time or to hangout. The company has also undertaken major changes in its signage in which it transformed its colour combination from bold red and yellow to a signage made up of yellow and dark olive. The style interiors that were designed in 1970s had more of elegant spaces. The main objective behind the restructuring of the outlets of the company was to offer the European market what they demand for by getting in the best of architects and advertising its stores as one of the most innovative and technologically advanced outlets across the region (Smart 156). The goal of the company was to make the experience that the customers would undergo and the product range to be more localized. McDonald’s promotes all its ad campaigns in the European market on the basis of privacy that it offers to the consumer market and even the level of comfort that the consumers experience while dinning at McDonald’s. The company has even incorporated kiosks in all its stores across the European market as majority of the customers uses debit cards for all their transactions and this would be a comfortable media through which the customers can order for their meal and pay at convenience. The company had even taken effective advertisement measures so as to rebrand its stores and position itself as a “healthy fast food restaurant” that offers the European customers a wide variety of sandwiches, burgers, salads, etc. The company advertised an innovative product menu with healthy dishes and it was mainly done through billboards, leaflets in daily newspapers and radio ads so as to make the consumers aware of the new products available at its stores. Some more advertisements that were implemented by the company in the European region has been given below. (Ritzer 167) The company has even been actively involved in promoting the aspect of nutrition in today’s world. It has even launched its own website in France that is considered with nutrition, quality and green aspect of the environment, and even promotes different kinds of environmental awareness programs so as to build a strong brand image amidst the population. The four main regions in Europe where McDonald’s operates are Germany, Austria, Switzerland and Hungary. These four regions has different form of cultures that has even made McDonald’s change its advertisement and even product line so as to suit the different culture. For instance in Germany in order to meet the demand of health conscious citizens it had introduced salads and different forms of juices in its product line so that it can meet their demand. On the contrary in Austria it had completely changed its brand logo and this was the first country in Europe to notice such a change in brand logo as the logo was given a green background with the symbol in yellow. In Switzerland since the culture of people in this region is to have their meals in a sophisticated way so the company had taken effective measures to redesign its architecture and offer their customers an exotic experience while they have their meals in the restaurants of McDonalds. On the contrary the culture that is prevailing in Hungary is more inclined towards getting value for their money and this was highly reflected in the business operations of the company when it offered low priced products, combo meals, and even price discounts on specific occasions so as to satisfy the needs of this market and even to adjust itself in the culture. Thus there can be a clear distinction be made between the different cultures and the strategy that is adopted by the company so as to be aligned with the differences in culture. The advertisements of the company were mainly focused on the culture of European market that preferred more of healthy food and a sophisticated place to hang out with friends and family and enjoy their meal. All its ad campaigns encompassed delivering nutrition to the customers in the best and most tasteful way possible. However the company faces a tough challenge in the European culture where there is lot of criticisms that their ad campaigns shows great degree of nutrition content in their food items but in actual the products do not comprise of high nutritional level. There have also been challenges such as the stores of McDonald’s are un-cool and outdated as per the opinions of the consumers. Conclusion and Recommendations McDonald’s not only experiments with its product line but also comes up with the most innovative advertisement through any media so as to attract the maximum percentage of the consumer market in which ever region it performs its business operations. This has even enabled the company to obtain not only a desirable market share but it has even able to establish its market position in every country. The company which was been previously related to Americanization has been later adopted by every other culture. This was mainly because of the fact that the company always aligns its business operations according to the culture in which it operates. The culture of Asian market is completely different in respect of the other two markets in which it performs its business operations. This is majorly because of the tradition, beliefs and values that the people in Asian market possess are completely different in context of other two markets. The likes, preferences, tastes and dislikes of all the described markets in the study are not related to each other and so this has enforced McDonald’s Corporation to form different promotional strategies so that people of a particular culture can effectively relate to the advertisements being promoted by the company. For instance in this study it has clearly been depicted that the preference of Asian market is more about spending some quality time with family at these restaurants and so the ads that were designed were more focused on involving all the three generation who can dine at McDonald’s and create some memorable moments with family. This culture has even enabled the stores to be considered as ‘family restaurant.’ To further highlight the cultural aspect of different regions in which the company operates it can include various culture people who enjoy their meal at different outlets of McDonalds. The cultural aspect can further be shown by associated the brand with the main traditions that exist in different regions. If in some culture giving time to the family is more important than that should be reflected in the advertisements whereas in some other culture if spend quality time alone in a sophisticated atmosphere is more important than that should be reflected in the advertisements. In the form of advertising the brand the company can restructure itself in the form of products, prices, store outlets and design. The culture played a very important role for the company in this context because based on this cultural aspect the company modified its product range and even came up with the concept of combo meals, better prices, quality, and to develop a warm and friendly atmosphere for all of its consumers in the Asian market. Later on the company even shifted from this strategy as per the cultural trend and started promoting its product features in context of youth generation. However this cultural trend does not have any kind of similarity with the European market where the people are more sophisticated and this resulted into the company to make certain changes in its advertisement campaign so as to be aligned with the culture of the European market. The company focused on developing better interiors and even designed advertisements promoting the architectural designs that the company had undertaken so as to attract the sophisticated consumer base in the European market. The product line of the company was also modified which now focused on nutritional content of the food items that were being delivered by the company. Nutritional aspect was a major concern of the European culture as they preferred to consume those foods that were nutrition rich rather than consuming spicy food unlike Asian culture. On the contrary the individualistic cultural aspect of America had enabled the company to design food items and to advertise its services and product line more of getting extra value for the money being paid by the consumers. The company advertises through sponsoring various sports events that are held across these regions. However in the phase of intense competition the company needs to perform more of aggressive advertising so as to attract and retain existing consumer base. In today’s context the most effective media to reach out to wide range of consumers is utilizing social media. This platform is shared by majority of the population situated across the globe. The company even linked itself and its business operations with a global and noble cause which would be very effective to influence consumer market. In global context it can advertise itself as using recycling resources and minimum wastage of energy resources so as to safeguard the environment from global warming. In the noble context the company can undertake some activities towards helping the poor and needy in the form that every burger that is consumed by the customers some percentage of the amount of that burger would be given for education of poor children. Irrespective of which ever culture it operates such advertisement strategy has great convincing power and even would enable the company to derive the image of corporate social responsibility. As per the different cultural aspect the company should try out some innovative approaches such as solving obligations of consumers and by constantly upgrading and incorporating innovative product features in its product range. Works Cited Allen. Melanie., Analysing the Organisational Environment. UK : Select Knowledge Limited. 2006. Print. BloomBerg Business Week Magazine., Ethnic Marketing: McDonalds Is Lovin It. Web. 15th May 2014. Retrieved from: http://www.businessweek.com/magazine/content/10_29/b4187022876832.htm Chai. Dexican., West Meets East: The Evolution of McDonald’s Marketing in East Asia. Web. 15th May 2014. Retrieved from: http://wps.ablongman.com/wps/media/objects/4116/4215271/DexCaiResearchPaper.pdf Dransfield. Robert., Corporate Strategy. USA : Heinemann. 2001. Print. Kahn, Kenneth. Product Planning Essential. USA: M.E. Sharpe. 2011. Print. Kincheloe. Joe., The Sign of the Burger: McDonald’s and the Culture of Power Temple. University Press: Philadelphia. 2002. Print. Ritzer. George., McDonaldization the Reader. UK: Pine Forge Press. 2002. Print. Schnaars, Steven. Marketing Strategy. USA: Simon and Schuster. 2008. Print. Smart. Barry., Resisting McDonaldization. London: Sage .2000. Print. Watson. James., Golden Arches East: McDonald’s in East Asia. USA : Stanford University Press. 2001. Print. Read More