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| McDonald’s
and McArabia
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Contents
1. Introduction
2. Opportunity identification and selection
3. Concept generation
4. Concept evaluation
5. Concept development and product launch
6. Conclusion
7. Bibliography
IIntroduction
McDonald’s is one of the largest networks of fast food
restaurants in the world. In fact, this multinational company
currently operates worldwide and its further exposition is
the strategic goal of the company. It is necessary to underline
that McDonald’s fast food restaurants were traditionally
characterized by the high speed and quality of services, though
it can hardly be said about the quality of its products which
has been severely criticized since the negative impact of
fast food on human health was discovered. This is why the
company is under a constant pressure from the part of the
opponents of the spread of fast food restaurants.
At the same time, this does not really prevent the company
form the further growth, though in recent years a substantial
slow down in the development of the company was marked. To
put it more precisely, in 2002 McDonald’s announced
the first quarterly net loss in its history. Nevertheless,
the company is still progressing and its positions are quite
strong in the world market.
In this respect, it is worthy of mention that one of the strategic
directions of the development of McDonald’s fast food
restaurants was the adaptation of traditional American restaurants
to local culture, food habits, and lifestyle to the extent
that its fast food restaurants in different parts of the world
incorporated both American and local elements. As a result,
the traditional McDonald’s spacious fast food restaurants
with high speed and quality of services are combined with
local peculiarities such as McDonald’s restaurant in
the Arab world with strictly divided male- and female-only
lines. At the same time, the adaptation of restaurant to the
local conditions of life and local food culture imply not
only adaptation of restaurants but also the changes in traditional
menu and cuisine of McDonald’s which may vary substantially
in different part of the world. For instance, in the UAE,
as well as in other neighboring Arab states, the company launched
a new product known as McArabia that is supposed to match
the local tastes and preferences increasing the popularity
of McDonald’s fast food restaurants and its services.
Opportunity identification and selection
Basically, the identification and selection of the new product,
i.e. McArabia, were motivated by the necessity to adapt McDonald’s
fast food restaurants menu to the local peculiarities of the
UAE. It should be said that the main goal of the company was
to find the product that would match both the traditional
principles and standards of Mcdonald’s in all countries
of the world and the local cuisine and habits of local population
(Benedetto 2004). In such a way, the company focused on the
research of the product that could fully match this demand.
Obviously, the choice of McArabia was quite reasonable since
it was actually the adaptation of the major product of McDonald’s
fast food restaurants which was just modified to local conditions.
To put it more precisely, McDonald’s needed a product
that would constitute a traditional burger but did not hurt
the food habits and traditions of the local culture. It should
be pointed out that the selection of the product should be
very careful as traditional Arab cuisine has some products
that are simply forbidden to be used and consumed, such as
pork and similar products. This is why the company focused
on the product that could use elements of traditional local
cuisine and, at the same time, correspond to the brand and
image of McDonald’s.
Eventually, the company has dwelled upon McArabia as the perfect
product to the local market since it continued McDonald’s
traditions and cared about the local market as it was supposed
to be a sandwich containing some local ingredients, including
Arab bread, grilled chicken, lettuce, tomatoes, and Arab sauce
(Alkhereiji 2003). In such a way, the essential combination
was found and should be pointed out that this product was
actually selected because it was probably the most recognizable
dish served in McDonald’s fast food restaurants throughout
the world and, consequently, it would be quite logical to
select exactly this product and adapt it to the local market.
Concept generation
Naturally, the idea of the new product, McArabia could not
be immediately implemented in practice. At first, it was necessary
to analyze to what extent the idea of the implementation of
this product would be successful. In this respect, it should
be said that several factors were taken into consideration
that actually predetermined the decision concerning the choice
of McArabia and development of this product.
First of all, it should be said that it was necessary to decide
whether the product would be really popular and whether it
would mach the local tastes. To forecast the perspectives
of McArabia, McDonald’s specialists analyzed the local
cuisine and local food market. Eventually, they excluded all
ingredients that could be unaccepted by local people and substituted
them for the local one which were actually equal to traditionally
used in other countries, such as Arab sauce, Arab bread, etc.
Naturally, the forecast about the future implementation of
the product was made. In this respect, it is necessary to
underline that McArabia matching to the local food preferences
had really good perspectives. To put it more precisely, it
could be successfully implemented not only in the UAE, for
instance, but also in other countries of the Arab world as
well as predominantly Muslim countries with similar food habits.
In such a way, the potential market of McArabia was quite
large.
Furthermore, the universal character of the product could
increase its applications and the number of consumers since
due to the large implementation in various markets of Arab
countries it could gain the recognition and popularity of
consumers due to the correspondence of the product to the
local food traditions. In such a way, the potential markets
could involve all Arab countries that meant the increasing
sales of the product to local customers and, consequently,
the growth of sales potential of McArabia and the growing
popularity of McDonald’s at large since it would be
perceived not as a foreign company with strange cuisine but
rather as fast food restaurants friendly to local cuisine
and traditions.
Concept evaluation
However, before practical realization of the concept of the
new product, it was necessary to evaluate McArabia. It should
be said that the company carefully analyzed the perspectives
of the implementation of the new product and conducted a marketing
research focused on the analysis of the potential of McArabia.
It should be pointed out that the opinion of customers was
taken into consideration since they were questioned as for
their food preferences and their opinion about the implementation
of the new product was investigated. Basically, the consumers’
opinion was quite positive.
Naturally, McDonald’s could not ignore the opinion of
specialists and this is why the dietologists were also involved
in the development of the product since it is due to their
help the company had managed to clearly define what ingredients
were the most applicable to the new product that could be
the most popular among the local population and, at the same
time, preserve McDonald’s traditions.
Also, the company initiated the financial analysis of the
implementation of McArabia and it was found out that the new
product would not be more expansive than analogical traditional
products sold by McDonald’s. At the same time, it was
found out that the commercial potential of McArabia was really
great since Arab countries were the potential markets and
consumers of the new product that could stimulate the growth
of popularity of McDonalds which was often viewed as a hostile
network of fast food restaurants with cuisine that did not
match the interests of local population.
Concept development and product launch
On realizing the fact that McArabia has a good commercial
potential, it was necessary to practically implement the concept
in practice. First of all, it was necessary to create the
product and test it. Using the suggested ingredients the product
was carefully researched and its qualities were analyzed.
In the result of such a profound analysis it was found that
it was possible to start the production of the product.
However, naturally, it was necessary to initially develop
an effective business plan of the introduction of the new
product in the market. Basically, it was naturally to find
the suppliers of the product and provide efficient strategy
of promotion and distribution of McArabia.
First of all, McDonald’s defined its major suppliers
to its fast food restaurants in the UAE and other Arab countries.
In this respect, it is worthy of mention that, regardless
its concept as a local product, McArabia turned to be in actuality
a really international product since the Arab bread for the
sandwich was imported from Britain, while the chicken was
imported from Malaysia, though Arab sauce, for instance, was
really the local product (Leiby 2003). Nevertheless, such
the use of international suppliers did not affect the price
of the product dramatically and, nowadays, McArabia-with-fries-and-a-soda
meal cost at average $3.40 (Leiby 2003) that is quite a plausible
price for the local market.
Naturally, McDonald’s amply used its widely spread network
of fast food restaurants to distribute the new product that
was quite effective and the distribution was not very expansive.
In fact, it is possible to say that McDonald’s used
a traditional system of the distribution of McArabia similar
to other products which effectiveness has been already proven
by the large experience of the company’s work in the
market.
At the same time, it was obvious that the effective distribution
solely cannot contribute to the growing popularity of McArabia.
This is why the company launched a carefully planned and prepared
advertising campaign. Taking into consideration local peculiarities,
McDonald’s amply used billboards and printed media in
order to promote the new product. The main idea of the advertising
campaign was the idea of the creation of a totally new product
adapted to the national cuisine and food preferences which
was available at low price in any fast food restaurant of
McDonald’s network.
Conclusion
Thus, taking into account all above mentioned, it is possible
to conclude that the implementation of McArabia was essential
and strategically important step undertaken by McDonald’s
in Arab countries such as the UAE in order to change its public
image and get closer to the local customers. It is not a secret
that the popularity of McDonald’s in Arab world was
decreasing and, in such a situation the launch of the new
product adapted to the local food habits was simply essential.
Bibliography:
1. Alkhereiji, Mohammed. “McDonald’s Launches
McArabia”, Arab News Staff, March 5, 2003.
2. Benedetto, A. di. New Product Management. New York: Random
House, 2004.
3. Benfari, R. C. Understanding and changing your management
style. San Francisco: Jossey-Bass, 1999.
4. Gitlow, H. S. The Deming guide to quality and competitive
position. Englewood Cliffs, N.J.: Prentice-Hall, 1997.
5. Leiby, Richard. “You Want Falafel With That?”
Washington Post. Monday, March 17, 2003.
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