Marketing Strategies of Mc Donalds and Subway Sandwiches – Cases

The title is very clear and self-explanatory as to what I intend to write in this article. Actually, both these fast food giants are opening outlets on franchising basis. In addition to this,they (Mc Donalds and Subway) opened their outlets catering to local tastes and keeping in mind that most Indians prefer vegetarian food and do not eat beef.

There was time when burgers and pizzas were not very popular  amongst Indian people. But with the rising trend of globalization, increase in disposable income and western influence,  now consuming western fast-food has become an integral part in the life of  an Indian youth. The popularity of fast-food restaurants in India is increasing day by day as a result of which a numbers of foreign fast-food restaurants are coming to India to explore the fertile market here.  Growing at a rate of 25%–30%, the INR 11 billion Indian organized food and retail sector itself attracted various global food chains. Restaurants like KFC, Mc Donald’s, Pizza Hut and Subway are just a few fast food restaurants that have explored the potential of the Indian market.  In India, the food industry and particularly informal eating out market is very small.  Over a quarter of a million customers visit the McDonald’s family restaurant every day. The Indian fast food market is valued at $1-billion (Rs 4.547 crore) approximately. This excludes South Indian Udipi restaurants.

The two giants of fast food industry Mc Donald’s and Subway are trying their best to capture the bigger part of the market, and they have been quite successful in their approach. Mc Donald’s and Subway are two names that have attained great success in their Indian campaign.

The world of fast-food is growing at a fast pace. There are number of fast food companies that have played their cards well, but none of them has managed to reach the popularity level like Mc Donald’s. Mc Donald’s has emerged as a brand name for fast food. Think about fast food and the name of Mc Donald’s will strike you first. With more than 30,000 restaurants all over the world since 1948 Mc Donald’s is providing better service and products to its customers all over the world. None of its competitors have ever come close to the popularity of Mc Donald’s. MFY is a unique concept (cooking method) where the food is prepared as the customer places the order. All new upcoming McDonald’s restaurants are based on MFY. This cooking method has helped McDonald’s further strengthen its food safety, hygiene and quality standards. McDonald’s has around 10 MFY restaurants in its portfolio

In 2009, McDonald’s India won the CNBC Awaaz Consumer Awards for the third time in the category of the Most Preferred Multi-Brand Fast Food outlet.

In 2010, McDonald’s India planned to open 40 more outlets. The company has also earmarked a budget of Rs 50-60 crore to market its new products and initiatives for its consumers. Its new marketing campaign is titled – ‘Har Chotti Khushi Ka Celebration’ – in other words ‘Celebrate the little joys of life’ where it positions McDonald’s as a venue for enriching the life of consumers. In South India, McDonald’s has 29 outlets and plans to add 10 more by the end of 2010.

In India, McDonald’s employs 5,000 people and serves half a million customers a day via its 169 family restaurants. McDonald’s has 85,000 employees and serves 2.5 million customers a day in the UK.

Subway is a leading sandwich chain, which operates through a wholly-owned subsidiary, Subway Systems India. The case study provides an overview of the product strategy followed by Subway that involved customization of its recipes and preparation to match the tastes and sensibilities of Indian consumers.

Subway has followed more unconventional methods in approaching its customers. Subway has opened around 8000 outlets in non-traditional and unusual locations. E.g. in Automobile showrooms, Goodwill stores, high schools, zoos, appliance stores, ferry terminals, riverboats, and even a church. In China, it has around 200 stores and has plans to expand it to around 500. Subway has competitive advantage over other chain restaurants as it costs less to open it and operate a smaller format store.

Mc Donald’s and Subway have targeted different sections of the society to sell their products. Mc Donald’s is more concerned with kids, selling burgers and ice creams with toys whereas Subway is putting its emphasis on healthy eating habits targeting the young and the working class of India.

Now people are more conscious about their health and their eating habits. They prefer eating healthy food instead of junk food. To remain in the race it is important for Mc Donald’s as well as for Subway to offer people what they like to have.