Case 2
Case 2
Case 2
Introduction wrap line with the Angus Snack Wraps allowed customers to enjoy
“Can you imagine a world without the Big Mac? Or Chicken their popular burgers in a smaller, more portable fashion. Today’s Mc-
McNuggets? Or Happy Meals?” This is the starting line of one of the Donald’s website labels 10 “core menu items.” They are: hamburger,
McDonald’s website. McDonald’s the world’s leading food service cheeseburger, Big Mac ®, Quarter Pounder ® with cheese, Big N’ Tasty
retailer has more than 33,000 restaurants serving nearly 68 million ®, McDouble®, Filet-o-Fish ®, Chicken Selects ® Premium Breast Strips®,
people in more than 119 countries every day. Glocalization, a newer Chicken McNuggets ®, and French Fries (McDonalds Corporation,
term used to show the localization of corporations globally, is getting 2011).
popular due to a variety of reasons. The restaurant industry has been
McDonald’s Dilemma
foremost in this process with McDonald’s leading the way with several
With rapidly expanding global markets, McDonald’s have to de-
well-known fast food chains such as Starbucks and Dunkin’ Donuts
cide which countries to enter in order to serve growing world markets
(Jargon, 2011). McDonald’s have more than 32,000 locations in 117
as well as to gain the first mover advantage. However, they have to
countries and employ 1.7 million people (Jargon, 2011).
decide whether to use the standard menu used in the United States or
McDonalds divides countries into four different segments: United
to modify in order to suit the local tastes. If they have to modify any
States; Europe; Asia/Pacific; Middle East and Africa (APMEA); and Other
menu items, what is the degree to which modifications can be made,
Countries and Corporate. The U.S., Europe and APMEA segments ac-
without losing the McDonald’s brand image. In short, they had to
count for 35%, 41%, and 19% of the total revenues respectively. Under
tread slowly making changes and meeting the enormous challenges
the Europe segment, France, Germany, and the United Kingdom
embedded in domestic and international requirements. From the
make up for about 55% of revenues. Under the APMEA segment,
following discussions it will become apparent as to how McDonald’s
Australia, China and Japan make up more than 50% of the revenues.
menu changes were incorporated considering various elements.
McDonalds’ “major markets” include U.S., Canada, France, Germany,
U.K., Australia, China, and Japan, which together make up 70% of all Objectives
McDonalds revenues. According to 2010 annual report, global compa- Considering the large number of countries in which McDonald’s
rable sales growth was 5% with 11% earnings per share growth. The is located and the prevalence of prevalent differences, this case study
average number of customers served every day was 64 million (Mc- highlights some of the adaptations that were necessary to co-align
Donalds Corporation, 2011). with local consumer tastes and preferences. Menu offerings and ser-
vice styles in selected countries are analyzed highlighting the most
Menu Item Stategy
salient features and how these adaptations align with the prevalent
McDonald’s business model is designed to enable delivering of
food tastes and preferences. Items which are newly introduced and
consistent locally-relevant restaurant experiences to customers and
are different for the respective populations are also mentioned. Possi-
be an integral part of the communities. It facilitates their ability to
ble reasons for these adaptations or modifications are included in the
identify, implement and scale innovative ideas that meet customers
discussions of each country’s menu offerings. Each country’s adapted
‘changing needs and preferences.’ In 2010, McDonalds continued
menu offerings are compared with the core menu items served in the
to enhance the customer experience by remaining focused on the
United States highlighting significant changes. In short, examples of
Company’s key global success factors of branded affordability; menu
selected countries illustrate the menu adaptations to suit the socio-
variety and beverage choice; and convenience. Their financial perfor-
cultural, religious, food preferences, and environmental conditions.
mance is attributed to several factors including core menu items like
Using McDonald’s as an example, the primary focus of the study is on
Chicken McNuggets and burgers. In addition, extending the snack
how adaptations have to be made in order to compete as well as at-
tract foreign markets. The points of learning and discussions are (a) to
Mahmood Khan is affiliated with Virginia Polytechnic Institute and State realize the importance of socio-cultural, religious, food preferences,
University and Maryam Khan is affiliated with Howard University.
66 Volume 2, Number 2
delivery was the use of the drive thru concept by consumers. Many con- is included can be added to the chicken and shaken before eating.
sumers would buy meal using the drive thru, park their cars, and come Teriyaki Chicken Filet-O is released only during the month of April.
inside the restaurant to eat. (Griffith 2008). McDonald’s had to provide The Ume Nuggets are chicken nuggets served with Ume sauce, a sour
information on the correct use of the drive thru service. As with India, plum sauce for dipping. Shrimp Thousand Island Wrap, contains salad,
China is also the fastest-growing market with an increasing number of shrimp and Thousand Island dressing. French fries can be ordered in
restaurant units every year. It is also home to the world’s largest McDon- barbecue, seaweed or Italian basil flavors, which are all very popular.
ald’s restaurant. The first Chinese location opened in mid-1992 situated Dessert items include an unusual Bacon-Potato Pie, which is like an
very close to the Tiananmen Square. In spite of having a 20-year lease, apple pie with mashed potatoes and bacon. Green-tea flavored milk-
McDonald’s had to vacate the site since the Beijing’s city government shake is a very different beverage offered in Japan to match the local
decided to build a complex city center at that location. In spite of this taste (McDonald’s Japan, 2012).
set back McDonald’s now has more than 1,000 units in China and plans The Japanese did not use hands while eating food prior to the
to open 600 new units by 2013 (Keegan & Green, 2013). arrival of McDonald’s in their country. This was a big adjustment for
Japan Japanese who are so particular about their culture. Ronald McDon-
ald’s is different in Japan, named Donald McDonald, and looks more
McDonald’s have adapted several items and modified their menu
items considerably utilizing the existing domestic popular Japanese like a Spiderman type of character. McDonald’s in Japan is ladling on
the calories -- an unusual strategy in a country known for its healthy
cuisine. In addition to common breakfast menu items, Salad Marinate
diet and longevity. McDonald’s Holdings Co. (Japan) Ltd. rolled out its
McMuffin (lettuce, marinated onions, cheese, bacon and red paprika/
Big America 2 campaign featuring burgers named after U.S. locales.
pepper), Bacon Lettuce Egg wrap, Mega Muffin (two sausage patties,
The Idaho burger features a quarter-pound beef patty, melted cheese,
a slice of cheese, an egg, some bacon and ketchup) are included. Also,
a deep-fried hash brown, strips of bacon, onions and pepper-and-
Chicken Caesar Wrap as well as the Fillet-o-Fish sandwich is offered as
mustard sauce. The calorie count: 713. The Texas 2 Burger -- with chili,
breakfast menu since Japanese prefer to have meat items for break-
three buns, cheese and bacon -- comes in at 645 calories. The 557-cal-
fast. Lunch and dinner menus contain several adapted menu items.
orie Miami burger has tortilla chips -- not as a side dish, but nestled on
These include Chicken-lemon and salt, and shrimp burger called the
top of the beef patty (Sanchanta, & Koh, 2011).
Shrimp Filet-O or Ebi Filet-O, served with Thousand Island dressing.
Japan seems to have pioneered a shrimp creation, dubbed as Saudi Arabia
the Ebi Filet-O, which was offered first in Japan and now by other Mc- Imported American restaurant concepts are more affected by re-
Donald’s restaurants in the region, mainly because of its popularity. It ligion in the Middle East than in any other region on earth. Depending
is a deep fried shrimp patty covered with a tangy, chunky sauce and on the level of orthodoxy that prevails in a particular Middle Eastern
lettuce. There is also a Mega Teriyaki Burger (ground pork sandwich country, restaurateurs must adjust their construction, purchasing and
with mayonnaise, lettuce, and teriyaki sauce) and a Teriyaki Mac Burger, operating standards - even their trade names - in varying degrees to
which are likely temporary promotional items. Another seasonal item accommodate religious sensitivities. Operators have to heed such is-
is the Tsukimi Burger (literally moon-viewing burger), a beef patty sues as pervasive food-purity protocols, intermittent prayer breaks,
topped with bacon, one poached egg, and mayonnaise-ketchup and intolerance for alcohol as well as gender mixing (Martin, 1998).
sauce, served before or during the tsukimi (autumn moon) season; Being a strictly religious Muslim country no pork or alcoholic drinks
egg representing the moon. Koroke Burger, mostly served in winter, can be served. McDonald’s promote that 100% of their products are
is a sandwich with breaded mashed potatoes, shredded cabbage, and Halal, a term designating foods that are permissible according to the
katsu sauce, served with or without cheese. The quarter pounder is still Islamic law which has regulations related to animal slaughter, process-
called “quarter pounder,” even though Japan uses the metric system. ing, and additives. All products served at all McDonald’s restaurants
There is also a MegaMac, which has almost the double the amount of are inspected and approved by local authorities and Islamic inspectors
meat in BigMac. Croquette Burger and McPork are other meat items at the countries of export. They serve standard array of hamburgers,
offered for lunch/dinner. The Gracoro is an intriguing deep-fried veg- Filet-o-Fish, and chicken sandwiches. Chicken Big Mac is offered in ad-
etable milieu. Chicken items include Chicken Snack, which is a thin dition to regular beef sandwich. One of the special items is McArabia,
chicken breast breaded and fried – like a large flat chicken select in which is designed for serving in Arab countries. McArabia Kofta sand-
hash brown shape. Chicken Tatsuta is another chicken sandwich. They wich is an example of this modification which uses popular folded pita
also have something called a “Shaka Shaka chicken” to which a flavor bread instead of buns and contains barbecued style meats. It has two
(black pepper or cheese) is added and shaken before use. Actually this grilled chicken patties, Arabic pita style bread, lettuce, tomato, onion,
consists of little fried chicken pieces in a bag. The seasoning which and garlic sauce. People do not eat breakfast away from home and so
68 Volume 2, Number 2
Figure 1
Selected factors to be considered in menu offerings
to religious restrictions beef and pork cannot be served in India or Keegan, W. J. & Green, M. C. (2013). McDonald’s expands globally while adjust-
ing its local recipe. In Global Marketing (7th Ed). Pearson Education, 30-32.
special meat processing is required in Saudi Arabia and Malaysia. If
Kulkarni, S. & Lassar, W. (2009). McDonald’s ongoing marketing challenge:
consumers are not familiar with certain items they try to avoid them. Social Perception in India. Online Journal of International Case Analysis.
There are special religious and national festivals when people prefer Miami. Jan 31.1 (2).
special meals. In China people are more used to having soups and McDonald’s Corporation. (2010). Annual report. Published by McDonald’s
rice. Due to environmental conditions some hot or cold items have to Corporation. Oak Brook, Illinois.
be included. Conveyance and transportation are problems in some McDonalds India. (2012). Various. Retrieved April 5, 2012. http://www.mcdon-
aldsindia.com/.
countries, which makes it necessary to provide delivery service. In cit-
McDonalds Australia. (2012). Various. Retrieved April 6. 2012, from McDonalds
ies like Beijing, Seoul and Cairo, armies of motorbike delivery drivers Australia http://mcdonalds.com.au/.
outfitted in colorful uniforms and bearing food in specially designed McDonalds China. (2012). Various. Retrieved April 5, 2012, from McDonalds
boxes strapped to their backs make their way through bustling traffic China. http://www.mcdonalds.com.cn/.
to deliver Big Macs and buckets of chicken wings (Jargon, 2011). Thus McDonald’s France. (2012). McDonald’s France. Retrieved April 6, 2012, Various.
in order to be successful a corporation has to tread softly considering http://www.mcdonalds.fr/.
McDonalds’s Guatamala. (2012). Various. Retrieved April 6, 2012, from
all these factors. An outline of selected items that should be consid-
McDonald’s Guatamala http://www.mcdonalds.com.gt/.
ered is shown in Figure 1.
McDonald’s Germany. (2012). McDonald’s Germany. Retrieved April 6, 2012,
Various http://www.mcdonalds.de/.
Discussion Questions
McDonalds India. (2012). Various. Retrieved April 6, 2012), from McDonald’s
• People in other countries would like to taste American foods; India http://www.mcdonaldsindia.com/.
do you think restaurants like McDonald’s should even consider McDonalds Japan. (2012). Various. Retrieved April 5, 2012, from McDonalds
70 Volume 2, Number 2
Japan, http://www.mcdonalds.co.jp/.
McDonalds KSA. (2012). Various. Retrieved April 6,2012, from McDonalds KSA
http://www.mcdonaldsarabia.com/.
McDonald’s Malaysia. (2012). Various. Retrieved April 6, 2012, from McDonald’s
Malaysia, http://www.mcdonalds.com.my/.
McDonalds Russia. (2012). Various. Retrieved April 6, 2012, from McDonalds
Russia, http://www.mcdonalds.ru/?ver=html.
McDonald’s South Africa. (2012). Various. Retrieved April 6, 2012, from
McDonald’s South Africa, http://www.mcdonalds.co.za/home/home.html.
Martin, R. (1998). Religion reshapes realities for U.S. restaurants in Middle East.
Nation’s Restaurant News, 32 (7).
Sanchanta, M. & Koh, Y. (2011). McDonald’s in Japan gives new meaning to su-
persize. Wall Street Journal (Eastern Edition), Jan 12, pB1.