Kedar Teny, Director - Marketing & Digital, McDonald’s India, West & South, talks about marketing efforts behind making the brand affordable and convenient in the QSR category
By SALONI DUTTA
Q] You’ve introduced new products in association with Minions and are running a campaign for it. What led to the menu association?
We have multiple levels of activation within our system. Sometimes, it is just to create some excitement in stores, something on the menu, or some hoopla for customers. This time, we have taken the idea to a more integral level and made a more cohesive effort around the campaign, with a TVC backed by in-store excitement followed by menu integration as well as toys. This is the first real ‘vertigration’ across the brand menu and the product. Along with TV, we are also doing digital integrations like a Minions’ takeover of our Facebook page and contests on our Twitter handle. We are also using Radio to drive awareness. In Mumbai and Bangalore, the Minions’ following is the highest and trending quite high, and these cities also happen to be our strong markets, so we are leveraging other mediums to drive excitement in them.
Q] What is your general media mix?
Television is the primary medium of delivery for us. It is followed by Digital because it allows us to engage with our customers. And depending on who and what kind of a product we are targeting, we use other support mediums like Outdoor, Radio and Press.
Q] How have your campaigns fared over the last few months in terms of building the brand?
Nowadays, people are constantly in the virtual world and tend to miss out on creating fun memories in ‘real time’. We touched upon this subject in our campaign Kuch Pal Offline in April-May, as most of our customers could identify with its message. The campaign highlighted the importance of enjoying offline moments and creating fun-filled memories while dining at our restaurant. McDonald’s introduced sharing bundles with the tagline – ‘Internet se kuch pal ke liye break-up kar le, McDonald’s aa kar share kar le’ to echo our sentiments #together4real #kuchpaloffline. Sharing bundles are customized meals that can be shared between groups of twos, threes or fours. It gave us great results; our brand scores looked healthy, and we were able to do exceedingly well in that quarter. Another campaign was our Doubles Fest which happened at the start of the year. Through the launch of the Doubles Fest, the widely popular McDonalds’ burgers were available with two lavish patties, for a little extra price. We had taken a 360-degree multi-channel approach for the campaign and it was promoted across TV, Print, Radio, Digital and Outdoor mediums.
Q] How are the online ordering service and the app working for the brand?
Online ordering is on the rise in the QSR category, and we see great traction coming to us from there. We have just about started building our capability in Delivery and it is working well so far. Online ordering and the mobile app contribute to over 30% of the revenue of the Delivery business. Our communications have also become far more integrated. In addition, we have started to customize offers uniquely for our online and app delivery customers. The app requires a separate marketing effort to drive customers to use their phone.
Q] How do you maintain the price point with issues like food inflation?
Since 1990, over six years were spent to establish the McDonald’s unique ‘cold chain’ which brought about a revolution in the QSR industry. When we started our operations in India in 1996, a lot of time, money and effort was invested in building capabilities for the business to handle the scale that we knew we were going to achieve in the next few years. With the help of the supply chain and the cold chain, we are able to help cut down on food waste. Since we work closely with farms, there are no middlemen involved, which allows us to save cost and pass on this benefit to the customer. In order to maintain value and ensure consistency in the quality of produce, McDonald’s and its suppliers have invested $200 million in the supply chain till date.
Q] What is the USP of McDonald’s in relation to competitors in QSR segment?
Competition is always welcome. Western fast food is a very small sub-set of the eating out category in India. There is massive headroom for growth. We define ourselves on QSCV, which is quality, service, cleanliness and value, which is our USP. The sheer footprint we have and the options and variety that we offer is our other big USP.
Q] What are some of McDonald’s brand extensions?
McDonald’s is the first QSR brand to make full-scale deployment on brand extensions and formats such as McDelivery Service, Drive-Thru’s, Breakfast, Kiosks and McCafé. Today, 25% of our restaurant portfolio comprises of Drive-Thru’s on key highways. We launched McCafé in October 2013 and now have more than 40 McCafés in West and South India.
Q] In this health-conscious age, do you find it difficult to keep the customer satisfied?
Over the years, we have taken steps to ensure that our offerings are wholesome and aligned to the nutritional benefits that customers seek. We display our ingredients in our communication, and also talk about our fresh food. More than 98% of our products today are sourced locally. Starting from 2010, when we launched our all-grilled breakfast menu, a lot of menu innovations like the steamed egg patty have taken place. Our ice-creams, soft serves and shakes have less than 3% fat. Recently, we reduced the sodium content in our fries and nuggets by 20% and in other products by 10% without altering the taste. We have also cut down the oil percentage in mayos by 40%. The calorie content has gone down and overall every burger or packet of fries now has 7 to 8% fewer calories.
Q] Going forward, what will be the focus area for McDonald’s?
One, store expansion because that gives you penetration. Two, developing relevant menu products so that you always remain the brand of preference. Three, to offer an environment that entices consumers to come in, hang out and spend more time at an outlet. In the next three to five years, we are looking at investing around Rs 700- 750 crore, building a database and adding to our current strength of 209 restaurants with 175-200-odd outlets in West and South India.
ABOUT THE BRAND
Westlife Development Limited (WDL), listed on the Bombay Stock Exchange, focuses on putting up and operating Quick Service Restaurants (QSR) in India through its subsidiary Hardcastle Restaurants Pvt. Ltd. (HRPL). The company operates a chain of McDonald’s restaurants in West and South India, having a master franchisee relationship with McDonald’s. There are 209 McDonald’s restaurants across 26 cities in India (as on March 31, 2015), which provide direct employment to over 7,500 employees. India is the first country in the world where McDonald’s does not offer any beef or pork items. It has also re-engineered its operations to address the special requirements of vegetarians.
FACTS
CREATIVE AGENCY: LEO BURNETT
MEDIA AGENCY: MADISON
SOCIAL & DIGITAL MEDIA MARKETING AGENCY: TONIC
PR AGENCY: TORQUE COMMUNICATIONS
CMO FILE
Kedar Teny, Director - Marketing & Digital, McDonald’s India (West & South), has over 17 years of experience in brand management, strategic planning and advertising. He joined Hardcastle Restaurants as Director - Marketing & Digital in mid-2014, and now spearheads marketing for McDonald’s across consumer engagement platforms. A commerce graduate from Sydenham College, Mumbai, Teny holds an MBA in Marketing from the Institute of Management Studies, Indore.
MARKETING TIP
Stay focused on consumers and cater to their needs.
MARKET SCENARIO
The Informal Eating Out Industry (IEO) market in India was valued at US$ 96.0 billion in 2013 and has been growing consistently over the past couple of years. Catalysed by the growth in of QSRs, the IEO segment is expected to surge to US$ 1.2 trillion by 2015. The Quick Service Restaurant (QSR) space is part of the IEO industry and represents about US$ 15.6 billion or 18% of the total IEO market in India. Western Fast Food (WFF) category is one of the fastest growing segments within IEO, and is seeing huge action with new entrants (Burger King, Wendy’s, etc) while existing players (McDonald’s, KFC and Pizza Hut) have been evolving to meet changing customer needs.
(Source: Euromonitor)
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