Case Study: McDonald’s Success
HEW ANN LI ( C1301571)
Short essay questions based on the Case Study given. Answer ALL.
- Based on the case study, it is stated that ‘People’ come first in the context of McDonald’s success. Describe the impact of international activities on ‘People’ that contribute to its international success.
(10 Marks)
In order to achieve international success, “people” considered as the most important factor when doing international activities. The people involved including the advisors, vendors, partners and customers. It’s all about getting the right people on board with the intention of creating a unique, competitive advantage company which differs from others. Especially when it comes to international activities, “People” can make a huge change. Before we operate and manage businesses in foreign markets, first we need to understand the people there. Cultural differences of people can affect one’s buying behavior. The elements that need to take into consideration in cultural elements include values, beliefs, traditions, religion and languages. It is important to pay close attention on culture as it influences the way people negotiate and interact with other business partner, employees and even their customers. Putting people first is a key factor for a company to success because it helps to understand customer’s needs and wants; and even can satisfying their employees. Therefore, “People” can be said to be the most important factors that contribute to its international success.
- Describe the advantage of having the right ‘Product’ and the ‘Right Prices’ in the international context by referring to McDonald’s approach.
(10 Marks)
It is important to deliver the “Right Product” to the “Right Place” at a “Right Price”. By referring to McDonald’s approach, McDonalds have set their target market before they launch a new menu which meets the target markets’ needs. We know that customer preferences always change; therefore we have to do some research before delivering the product to them. Having the right product to the right person at a right place could help us to build a competitive advantage among others competitors. “Right Price” is also a determining factor to profit. Setting an affordable price to the market creates value to the customers. Although pricing decision making is difficult in international context as it involves adjusting prices concerning the competitive environment, currency exchange rates and involves buyer perceptions, but getting your international pricing strategies right is crucial to the success. When setting prices internationally, we have to consider the standard of living and income levels of the target markets. We also need to consider the buying behavior of the population to determine what value people perceive certain products and services to be worth. Then we have to decide either standardizing or adapting the price competitors offered in an unfamiliar market. Therefore, having a “Right Product” at “Right Price” creates sustainable competitive advantage over its competitors. As we know, being equal isn’t being competitive, being better is!
- In the context of cultural attributes of aesthetic, explain the importance of blending and condoning to national’s regulations.
(10 Marks)
Visual embodied in the color or shape of a product, label, or package. Styles is the various degrees of complexity, for example, are perceived differently around the world. For instance, red associated with blood, wine-making, activity, heat, and vibrancy in many countries but is poorly received in some African countries. White is identified with purity and cleanliness in the West, but with death in parts of Asia. Gray means inexpensive in Japan and China, but high quality and expensive in the U.S. Different countries have different cultural attributes of aesthetics. As for example, in China, people use Red to indicate good luck and celebration. In Malaysia, yellow indicates the Royals but in India, yellow signify a merchant. As we know the cultural attributes of aesthetic of different countries, it may reduce the barriers enter to a country. People can incorporate this understanding into the marketing planning process. An understanding of cultural attributes of aesthetic used in different countries is important if you want to be successful at an international level. A lack of knowledge about international business practices is one of the most common causes of conflicts and misunderstandings between two nations. This resulting in creating disagreements and missed opportunities. Therefore, it is important to understand and learn the cultural attributes of aesthetic which is blending and condoning to national’s regulations.