Case Studies

Product Design at McDonalds: Standardization vs. Localization

In the fast food industry, standardization has always been a key to success-products that taste and look the same, no matter which location you visit, builds recognition and brand locality. but when a brand decided to go global, standardization is not enough.

McDonalds is a great example of how customizing products to suit local tastes is a successful strategy. McDonalds has managed to harmonize its most recognizable and highly standardized menu with local ingredients and flavors in several counties. The most recognizable of its standardized products is the Big Mac, which is so widely popular that the The Economist uses it ot compare purchasing power parity among nations.

Given the changing consumer preferences, compounded by materials changes, and ever-improving food technology, McDonalds realized that designing invocation was necessary-creating new products suited to local palates. Et voila! People in Canada can gorge on the poutine, a local favorite consisting of French fires covered in cheese, curd, and gravy. Japanese customers can enjoy the EBI filet-O, a shrimp filet sandwich, and wash it down with a melon float. In the Philippines, people can get an odd pairing of fried chicken with spaghetti on the side. Unique dishes are also available in regions where you would expect uniform taste preferences. In Europe, Italy has spinach and parmesan nuggets, Poland has the cordon bleu burger, and the Netherlands gets a burger with beef stew-filled coquette.

To implement its strategy, McDonalds incorporates customer satisfaction, strong teamwork, and aggressive promotion. And customers do respond to McDonalds because it delivers value-that is, benefits for costs. McDonalds has introduced several different items globally, and, although not all of them are available year-round, it shows that there is a demand for localized products, even in an industry where standardization dominates.

Discussion Questions:

1. What drives McDonalds need for creating local products in addition to their traditional menu items?
2. How can phasing out traditional menu items in some markets be a successful strategy?
3. Which other industries need localized products despite standardization being an important factor?