Philippine Franchises

Mcdonalds Franchise In Philippines

Mc Donald's, the world's leading food service chain, rules the market in every country it does business. Well, almost. Because, in the Philippines, Ronald Mc Donald, the auburn-haired clown mascot in red-and-yellow costume, failed to dominate the quick service business and settled to be second fiddle to the more successful local food service brand, Jollibee.

It may come as a surprise for a social analyst who is familiar with the Filipino colonial mentality and love for everything American, to know that a well-accepted inherently American brand will fail to get a powerful grip on the Philippine market.

If thorough examination, though, of the leading competitor will be made, one can find an obvious answer: Jollibee's lead is a result of an ingenious marketing strategy. It adopted all the things that made Mc Donald's successful, but it adjusted its menu to cater to the local taste. The local licensee of Mc Donald's, Golden Arches Development Corp., being tied to follow the system imposed by the franchise, could not provide what the local market wanted.

Then on March 2005, the McDonald's Philippine franchise became 100 percent Filipino-owned, when George Yang's publicly-listed holding company, Alliance Global Group Inc. bought the 49 percent shares of its American partners, which gave its owners some flexibility in managing the business. Yang said that his full acquisition of the Philippine franchise would enable McDonald's to "give our customers even more by being more sensitive and responsive to their changing tastes and wants and by adding a local flavor to our product range."

McDonald's modified its menu to include Filipino favorites, including McSpaghetti (following the sweet-style spaghetti menu that Filipinos prefer), fried chicken and rice. They also aired family-inspired television commercials featuring megastar Sharon Cuneta-Pangilinan and her two daughters, Frankie and Miel which become quite successful in building the image of Mc Donald's as a family-friendly restaurant championing Filipino values like love for family members and sharing. A few years back, it capitalized on the popularity of "American Idol" finalist and Filipino-American Jasmine Trias who did the "Finally I'm home… Love ko 'to" commercial. The company plans to expand more aggressively by putting up more restaurants in the coming years especially in the provinces where they don't have much presence. Keeping their prices affordable to the general public without sacrificing product quality is a constant challenge but, so far, they have succeeded. Burger McDo and longganisa burger is priced at 20 pesos apiece; McSpaghetti is 35 pesos while an order of regular fries costs 25 pesos.

Beating the leading local brand is among its agenda and Kenneth Yang, Golden Arches managing director, believes it can be done. It's a tough game to play and it may take a few years of hard work and strategic move but as long as they continue improving their products, services and management and satisfying their customers, they believe they can beat all the competitors - not just Jollibee.