Marketing Across Cultures: The impact of McDonalds and Starbucks Marketing elements

Introduction

The process of globalization enforce many multinational company like McDonald and Starbucks need to modify their marketing strategy to adapt the cultural difference. Cross-culture marketing is one specific knowledge that is increasing needed for marketers to learn and perform. Within Marketing across culture, marketing mix is the most common tools for marketers to analysis and develop critical strategies for their target markets. In order to make the best sales for multinational companies in different countries or cultural areas. Marketers need to identify the issues and problems within different cultural markets. The following essays is first going to discuss the McDonald’s marketing strategy by using product and promotion marketing mix analysis, then demonstrate the practical example about how McDonald’s achieve its market efforts. After that, the essay will analysis the product and promotion of marketing mix of Starbucks and how it manage its market efforts.

In 1960, Jerry McCarthy stated a marketing theory in his book ‘Basic Marketing’, that is: Product, stress on the development function, requires the product with a unique selling point, functional requirements of products is paramount; Secondly, price, depend on different marketing position make different price strategy, the products pricing is based on brand strategic of company; Next is place, the company not direct face to customers, but focus on cultivate franchiser and establish marketing network, the connection between company and customer are through distributor to build up; Finally, promotion, company focus on changes of sales behavior to stimulate customers, use short -term behavior (such as buy one get one, etc.) to encourage consumption growth or attract other brands of customers spending in advance to promote sales. Product, Price, Place and Promotion are famous 4P marketing theory. This paper will focus on 2P(Product and Promotion) in depth to discuss.

Marketing mix of McDonald and How it manage its marketing efforts

McDonald’s is one of the most successful fast-food restaurants. The goal of McDonald’s is to establish a standardized product, whether McDonald’s in Singapore, South Africa or Spain, customers will taste the same flavor. MacDonald’s realized that due to the procedure of standardization can save significant cost of product, enable to adapt to the environment and make sure success. So, McDonald’s has adopted the idea “think global, act local” (Vignali, 2001).

Adaptation contains many requirements, such as customer’s tastes, preferences and the local law. McDonald needs to adapt to many situations, religion, laws and customs. For instance, after initial protests in Israel, McDonald’s supply Big Macs without cheese in several outlets, thus allowing the kosher restaurants required separation of meat and dairy products. Moreover, McDonald’s restaurants in India provide Vegetable McNuggets and a mutton-based Maharaja Mac (Big Mac). Beef is not acceptable in Hindus, Jains (among others) do not eat any type of meat, Muslims do not eat pork, as this innovation is essential within a country. McDonald’s need to experience rigorous inspections by Muslim clerics in Malaysia and Singapore, this is for ensure ceremony cleanliness; a series of act was award with a halal (” clean, acceptable”) certificate, making known the completely lacking products that contain prok (Vignali, 2001).

McDonald’s also has many examples to adapt the original menu in different countries just for meet customer demand. Guava juice was introduced to the McDonald’s menu in tropical markets. In German, beer is served on the menu. In Turkey served chilled yogurt drinks, McDonald’s in Italy supply espresso and cold pasta. McDonald’s in Japan sold Teriyaki burgers, vegetarian burgers in The Netherlands. The McSpaghetti launched in Philippines is getting popular gradually. Grilled salmon sandwich named McLaks is launched in Norway, poached egg hamburger that is named McHuevo in Uruguay. In Thailand, sweet sauce is served with Samurai Pork Burger at McDonald’s. Above examples are how McDonald’s adjusts its product based on cultural difference in different areas.

No matter how to change the basic menu structure of McDonald’s is unify in the world: the main course is hamburger or sandwich, fries and drinks (majority is Coca-Cola). Main course may be very difference, but the McDonald’s sign idea: fries, is always be there and used in McDonald’s around the world, no matter their political statement or religious beliefs. This is the reason why McDonald’s do fries so successfully and continue efforts to work on improving the delivery of this industry winner (Vignali, 2001).

Kotler had stated promotion as composed of five major tools in 1994: sales promotion, direct marketing, publicity, advertising, public relations and personal selling. McDonald’s has very different advertising based on different culture in different country. For instance, McDonald’s find England football representative Alan Shearer as a figurehead to increase selling hamburgers; in France, they use French national goalkeeper to promote hamburgers. McDonald’s wanted to express the same concept: in different culture use different personalities to communicate their message.

McDonald’s has distinct advertising in China. In the fall of 1994, they had not put advertisement on Beijing television program. The general manager of McDonald’s indicated that McDonald’s advertising on television is meaningless, because of China’s advertisement is different from the West; it is only emerged in interval between programs. After watching this program, audiences will switch to another channel, which means the advertisement have little chance to be seen. Newspapers and magazines are popular, these is a good way to presented McDonald’s public image (Eckhardt & Houston, 2002).

In Beijing, the localization strategy of McDonald’s is totally different to the united state; the Beijing McDonald’s relies on interaction with customers to a great extent. There are several public relations employees are available to answer customers’ questions in daily operations and in each restaurant. Every outlet assigned five to ten female receptions to look after children and chat with parents. The whole courtesy issue is too important that McDonald’s have to pay extraordinary attention on that. (Cai, 2003). This public relation measures is completely not in the UK, people in there have totally different mentality, they are happy to just left the restaurant after meal (Vignali, 2001).

There are certain numbers that McDonald’s does not adopt a global strategy. McDonald’s signed up a ten years global alliance contract with Walt Disney in Jan 1997, allowing them to share the exclusive marketing rights, from film to food. This is means McDonald’s producing toys from movie in “happy meals”, such as Toy Story, Finding Nemo and A Bug’s Life. In this case, McDonald’s would not take local measures, because of Disney has a huge influence in the world, and there is no need to do modification for different regions. As well, another global public relations exercise is being presented in associate with McDonald’s, Walt Disney and UNESCO (United Nations Educational, Scientific, and Cultural Organization), which is the Millennium Dreamers Global Children’s recognition program. Young generation from all over world have opportunity to give expression of their dreams, future plans and wishes (Abramowitz, 2006).

Marketing mix of Starbucks and How it manage its marketing efforts

This paragraph is going to discuss the marketing strategy of Starbucks and how it manages its market efforts. The product strategy of world’s largest coffee chain store Starbucks emphasis on not just sell a cup of coffee, but selling the coffee experience. The most attractive of Starbucks is innovation in the ordinary, change consumer goods existed hundreds of years into a popular trend, changed the modern life. In Taiwan, the coffee industry imported two kinds source of coffee: Arabica (accounted for 75% of total world output), Robusta (about accounted for 25% of world output). Most of the low-cost coffee in the last use of Robusta, but now the new franchiser join the coffee market stressed use the Arabica coffee bean’s quality is better than before, also the price is a little bit high.

Starbuck not just sell coffee, but also sells coffee beans, coffee-related equipment, books, coffee cups, sweets and pastries. The coffee store make warm leisure and chatting atmosphere, it is intangible products. Burca (2004) noted that modification of product is required for one company so that they can enhance attraction to its customers within its target market. Taiwan Starbucks developed green tea flavored products and approved by the United States headquarters. These products exported to the Starbucks in Singapore. Starbuck adapted the local culture to increase its sales. Taiwan Starbucks not only sales the Christmas merchandise in Christmas global activities, but also exploit exclusive moon cake in Chinese Mid-Autumn Festival, it is sell tens of thousands boxes in one year.

When modern consumer goods in commercial process, it is no longer from the view of political and economic environment to see commercialization, but further put centre of commercialization into cultural meaning. Modern customers in consumption not just consume goods, but includes the “symbol” of goods, product itself has a “cultural meaning”. The culture meaning of coffee is represented afternoon tea, relaxed, comfort and high degree of European culture. which is a increasing new life style in Chinese society.

Starbucks emphasis on product innovation and continuous introduced new products. In 1995, Starbucks introduced crashed ice cappuccino made Americans’ preference of hot coffee toward ice coffee. Now, Starbucks is faster to introduce new products, only in 2002 introduced 7 kinds of new drink to increasing attraction to young people. Starbucks continue to play the brand force to find new channel to sell more kinds Starbucks. In 1996, Starbuck cooperation with Dreyer’s to develop Starbucks ice cream.

On the other hand, brand image and product standardization are also the competitive advantage of Starbucks. The name of Starbucks is one of the main reasons why millions of customers buy coffee from Starbucks (Cateora et al, 2009). Johnasson (2009) had stated several reasons why product standardization can benefit one company. Cost Reduction, increase global customers, enhance global segments, enhances customer preference and Improved quality. Those are the advantages of product standardization.

In promotion aspect, according to Borden in 1964, promotion includes policies and procedures that associate with coming up with special sales plans and form of devices for customer promotions. Starbucks in North America and Europe launched online and mobile phone pre-ordering services in 2002, nearly two thousands Starbucks sticker a small antenna affixed on the door to marked there is high-speed wireless internet in store, this is Starbucks cooperation with German telecommunication company to provide new service. Starbucks will bring out annual Thanksgiving Day in the winter, when customer consume something will have 85% discount. Except these Starbucks also introduced delivery service, some stores offer delivery service, deliver drinks and pastries (Laura, 2003). Above examples are how Starbucks adapts local culture or specific needs in order to meet its market efforts.

There are many marketing features of Starbucks, for example, in Taiwan, unlimited supply of sugar, whipping cream, cinnamon, vanilla powder, cocoa powder, cardamom powder. Provide American traditional style consumer environment, use of the South American style of music: JAZZ. provide introduction of coffee culture, for example, books about coffee, the choice of coffee beans, all kinds of coffee name, coffee conditioning tips. Offers a wide range of coffee brewing equipment and coffee subscription service. The reason for that is within Taiwan society, there is relatively high cultural identity toward western culture such as American culture (Mathews, 2000). Starbucks also encourages environmental friendly, if customers bring their own cups that have cash discount.

Conclusion

In conclusion, marketing across culture plays an important role for those multinational companies when they expand abroad. Most multinational companies have been struggle on how to balance product standardization and localization. However, we can hardly say that witch strategy is best for some specific area or cultures. There is still needs for a period of marketing observation and survey then decide which strategy is suitable for that market. The reason why McDonal and Starbucks are such successful global companies is that they identify the cultural difference and local requirement. Only when marketers who can identify the cultural difference and issues so that the company can smoothly manage its market efforts.

References

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