MD, | 02 Jul 2002
"Advertising does help in building brand recall, but advertising alone does not sustain a brand"
In this part of Brand Speak, we speak with Vikram Bakshi and learn about the various advertising and marketing initiatives at McDonald's, which have made it one of the favourite fast food resturants, especially amongst kids.
Q. Despite the fact that McDonald's is a fast food chain of restaurants, in India it has been positioned as the family restaurant. How did you bring about it? Was it a conscious decision or did it just happen. Was there any strategy behind it?
McDonald's is known as a family restaurant. We believe that we are here to make our customers feel at home and enjoy their time out with their family when they are at McDonald's. Extra care has been taken to make our restaurants child friendly, by providing play areas wherever possible so that the parents can relax and have a good time when they are visiting McDonald's. Our tables are rounded so that a child does not hurt himself while in the restaurant, our counters are low and the menu pictorially depicted so that a child can order a meal for himself very easily and his parents don't have to bother. At McDonald's, the customer always comes first. Every employee strives to provide 100 percent customer satisfaction -- for every customer -- every visit. This includes friendly and attentive service, accuracy in order taking, and anticipation of customer's needs. We have hostesses who keep circulating in the lobby helping children and adults alike with straws, napkins, soufflÃ© cups, sauce sachets etc. and any other assistance that they may require.
Q. Recently your ad line shifted to
When we started operation in India, five years back we were still trying to position ourselves as a place to visit, with the baseline "McDonald's mein hain kuch baat" in our advertisements. This had an aura of mysticism whereby people were encouraged to try the McDonald's experience. However over the years, McDonald's has been hugely accepted by our customers, so there was a need to evolve our communication strategy and move on from trying to encourage people to visit us for the first time to making McDonald's a regular experience. Now that we have already established ourselves, people have already visited us, they know what McDonald's is all about, we have changed our baseline to 'Toh aaj McDonald's ho jaye". Here we are talking about an everyday experience, not the first time visit. We are encouraging our customers to visit us more often with their family and enjoy their time out.
Q. Would more ad-campaigns be coming up this fiscal? What would be the theme? And if there is a shift in the same, then why so?
The present campaign will be on air for eight weeks. While other food commercials will follow this year, the theme will remain same. The objective will be to continue positioning McDonald's as a comfort zone for families.
Q. What is the brand's media strategy?
At present our focus is more on the electronic media as is evident. Our new brand film is all about emotions, family ties, fun and this has a higher visual appeal. The new ad that we have come up creates more impact if it is seen and heard at the same time and that fun filled atmosphere which our customers can identify with when in McDonald's, can be created only on electronic media. We do not usually support other advertisements be they marketing or commercials through other mediums such as print.
Q. On an average what has been the growth of your customer base. Please give us the break-up of first time consumers and repeat consumers. Has advertising played a role in attracting first timers?
Advertising does have its impact on consumers, but if the product that is being advertised is not good enough, then it is very difficult to maintain consistency in the sales figures. Most customers, who visit any McDonald's restaurant once, do come back. Our customer base has increased substantially since we started operations. The past four years has seen very high trials from first-time customers- averaging 77-80%. Now we are trying moving away from inviting trials and focussing on building customer loyalty.
Q. With so many coffee bars coming up and other fast food chains has it affected McDonalds? What has been the marketing strategy to meet competition?
We have always offered tea and coffee on our menu at our restaurants but we have recently tied up with Coca - Cola to serve their Georgia Gold brand hot beverages in our restaurants. We believe in providing variety and in keeping with this we try to add value to our customers eating out experience. Our core product and focus continues to remain burgers. Our marketing strategy is simple, we believe in satisfying our customers. QSC&V (Quality, Service, Cleanliness and Value) have been our core values from the very beginning and we firmly believe that these values will bring our customers back to us time and again.
Q. If these new trends have not affected your business what is it so unique about McDonald's positioning and marketing strategy that it has not been hit by these new outlets?
We believe in the McDonald's promise of "With a sense of fun and youthful spirit, we will proudly serve an exceptional McDonald's eating experience that makes all people feel special and makes them smile, every customer, every time." Every employee strives towards providing 100 percent customer satisfaction. We do not compromise on the quality of our products and have stringent checks at every step to ensure this. All these have resulted in developing a loyal customer base that keeps visiting us again and again. We do believe that it is this drive towards providing the best that keeps us head and shoulders above the rest.
Q. McDonald's is looking at a tie-up with Nestle India. You have already started test marketing nestle products in some outlets. Is it an attempt to counter competition from the new coffee bars, which serve varieties of coffee and tea?
Testing new products is an ongoing process based on our own menu vision and customer response. Of course, our focus does remain on core products - burgers, but we would like to offer some variety on our menu too.
Q. What according to you has been the strength of McDonald's as a brand in India?
McDonald's is the most recognisable brand world over amongst all age groups. When we launched in India we realised that we would have to Indianise some of our products to appeal to the local taste and yet retain our equity on core products. Being a culturally sensitive company, India is the only country where McDonald's does not serve beef and pork. This coupled with our consistently maintaining high standards of QSC&V and understanding of the Indian consumers, their needs and wants have helped in strengthening the McDonald's brand in India.
Q. Recently McDonald introduced co-branded ice-cream McSwirl with Cadbury India. Why did you go for a co-branded product when you had your own ice cream, which was doing well?
Yes, we do have our own soft-serves. But as I have already mentioned above, we keep introducing new items to our menu. Before introducing any product on the menu, we conduct extensive consumer research. We had received overwhelming response to this new product and our soft serve sales have gone up by 25%. Cadbury enjoys a 70% share in the chocolate market. We introduced this product as it offers a fantastic product to our consumers at a great price, which is basically a value addition.
Q. What has been the role of advertising in the success of McDonald's in India?
Advertising does help in building brand recall, but advertising alone does not sustain a brand. The products that we serve are of international standards and we believe that our brand has grown because we deliver our promise, we sustain the quality and experience promised to the consumers in our advertisements in the restaurants.
Q. When is McDonald expected to break even and how many more outlets do you plan to have in place by the end of this fiscal. What would be your marketing strategy for the smaller towns and cities?
McDonald's is planning to break even on operations by December 2003 and expand to 80 outlets the same year. We are planning to open 16 new restaurants by the end of this year. At present we are concentrating on cities from where our cold chain facilities can be availed, but yes, opening up in new places are on the anvil. We are also focussing on opening up restaurants in Highways. McDonald's has already opened 3 highway restaurants in India on the Delhi - Agra highway, Delhi-Ludhiana highway and Mumbai-Pune highway. We are also looking at several small cities too.
Q. McDonald's has been a favourite with kids. Will you be undertaking any promotional activities aimed at this segment?
McDonald's does run promotions and that involves children from time to time. At present we are running a Happy Meal Carnival in all our restaurants where a child can pick a toy of his choice from among 45 toys and win amazing prizes every time. The focus of this promotion is to enhance the family experience. McDonald's is all about having a great experience and this is another effort by which we hope to ensure that.
Q. You have used kids as an entry strategy to the family. Why this emphasis on kids? Is it part of your international strategy or a special plan for India?
World over McDonalds is a family restaurant and children are an integral part of a family. McDonalds ensures that every member feels special at our restaurants. Our restaurants are child friendly where children feel comfortable. The entire family can come and have a good time. We have always tried to make McDonalds the best family outlet where both the parents and the children would have a good time.
Q. Kids are becoming a very important target audience for most categories including consumer durables. Why have kids become the center to communicate?
In the 90's India saw a major shift to nuclear families. When there were more joint families, it used to be the head of the family who used to take most decisions. In smaller families everybody's opinion started mattering, whether it was for buying a fridge or a TV or whether it was for going out. The child became an integral part in decision making for buying things. Today the child does influence the decisions of parents as have been proved by research. We all realise that no longer can this group be ignored.
Q. McDonalds' is perhaps the icon of indeginising a foreign brand. How have you done it? What are the steps that you will be taking in future to bring it close to the Indian community
McDonald's worldwide is well known for a high degree of respect for the local culture. McDonald's has developed a menu especially for India with vegetarian selections to suit Indian tastes and preferences. Keeping in line with this, McDonald's does not offer any beef or pork items in India. In the last two years, it has introduced some vegetarian and non-vegetarian products with local flavours that have appealed to the Indian palate. Efforts are on to add and enhance variety in the menu by developing more such products