Michelle L.

Walker

AMU

BUSN601 Global Management Perspective

Instructor: Dr. Pomponio, Darlene

WA3

McDonalds and Starbucks spend huge dollars developing their brand names and

marketing initiatives domestically and internationally. How do you think McDonalds and

Starbucks are able to establish their brands to fit local markets through architectural design of the

stores, their e-commerce strategies and service to accommodate the local markets and culture? I

think both of them use similar techniques when it comes to blending a uniform corporate and

unique local design structures within their stores. They benefit from making specific

accommodations in their service strategies. For example, McDonald’s introduced McCafés to

accommodate for the new trends for high quality coffee. They also gain respect for the local

areas and their native cultures by linking their customer environments with their brand which

offers an emotional identification for the consumer. Their E-commerce strategies vary greatly for

the two corporations. You can see the differences between the design styles and customized

foreign websites. “All the McDonald’s websites are more colorful, hip and show big pictures of

the newest food products, a toll-free consumer hotline, offer free Wi-Fi, links for food nutritional

values, careers and having local fun” (Startz, 2009).

Do you think Starbucks benefitted from the missteps by McDonalds that you will read

about in your research? No, I don’t think Starbucks took full advantage of McDonald’s missteps
like McDonald’s took advantage of the mistakes Starbucks has made. Explain their approaches

individually and see if there are any differences or similarities. “Comparing Starbucks and

McDonald’s may not seem to make sense at first, but the two chains actually have a lot in

common namely, they both promise quick and easy food and beverages on the go, and both

companies have recently ramped up sustainability efforts” (Schwartz, 2010). Check out the full

HIP Investor chart below. (Schwartz, 2010)

McDonald's Starbucks

Overview Over 31,000 restaurants in 118 Over 16,000 locations in over 50

countries; $23.5 billion revenue, countries, $9.8 billion revenue
400,000 employees (FY09); 117,000 partners
(employees) **

Product Premium salads, fruit and yogurt
parfait, and apple dippers in
Happy Meal choices; packaging
gives customers essential
nutrition information in easy-to-
understand icon and bar chart
format
In U.S., spends more on partner
health care than coffee bean
purchases; The largest purchaser of
Fairtrade certified coffee in the world
**

Management 19 of 25: Carefully managing 21 of 25: Sustainability built into

Practices supply chain to control costs and
implement sustainability, and
developing an environmental
scorecard to measure supplier
performance
business vision, all performance
metrics and product development
decisions; From fiscal 2000 to 2009,
farmer loan commitments totaled
$14.5 million, goal is $20 million by
2015; Partners encouraged to
volunteer, with a goal of 1 million
hours of community service by 2015
**

Health In 2009 customer satisfaction is
70%; 82% of crew would
of 20% recommend working at
McDonalds to a friend
Wealth Crew members earn an average
of $7.60 per hour; 93% of eligible
of 20% employees participate in 401(k)
plan, made easier by $20 per
month auto-deductions
10% Customer satisfaction is 76%; all 14%
staff more than 20 hours/week have
health care access
9% Starbucks average hourly pay rates 13%
vary across the U.S. and the globe;
baristas in the U.S. are eligible for a
base rate increase after six months,
and a performance based increase

Earth About 82% of the consumer
packaging used in its nine largest
of 20% markets made from renewable
materials and 30% of the material
comes from recycled fiber.
Despite testing of innovative
materials, have not yet identified
more sustainable packaging
materials that are commercially
viable
Equality 37% of all U.S. owner-operators
are women and minorities; 26.7%
of 20% of worldwide leadership are
women
Trust Guidelines to determine the
sustainability of fisheries
of 20% developed in partnership with
Conservation International
Human TOTAL
Impact
of 100%
Corporate +30.1% return on equity (2008)
Profit
+20.4% annualized total return,
of 20% including reinvested dividends
(6/2004–6/2009
+23.4% annualized total return,
including reinvested dividends
(6/2006–6/2009)
(Schwartz, 2010)
every six months thereafter.; The
Stock Investment Plan allows
eligible partners to buy Starbucks
stock (up to 10% of base pay) at a
5% discount; Through the Bean
Stock program, stock options
granted annually to eligible partners
in 16 countries from part-time hourly
up to (but not including the director
level based on the company's
performance **
9% In fiscal year 2009, Starbucks 12%
served more than 26 million
beverages in reusable cups, and
approx. 70% (2,163) of its company-
owned stores in North America that
control their own waste collection
recycled items made from one or
more materials; Starbucks is
working toward 100% reusable or
recyclable cups by 2015 **
15% Among managers, approx. 31% are 12%
ethnic minorities and 66% are
women (6/1/2008-5/31/2009)**
14% All suppliers that adhere to C.A.F.E. 13%
status undergo third-party
verification; By 2015, Starbucks'
goal is to purchase 100%
responsibly grown and ethically
traded coffee, which the company
defines as coffee that has been
third-party verified or certified, either
through Coffee and Farmer Equity
Practices, Fairtrade, or another
externally audited system **
56% TOTAL 64%
+12.8% return on equity (fiscal
2009)
-6.2% annualized total return,
including reinvested dividends
(6/2004–6/2009)
-16.3% annualized total return,
including reinvested dividends
(6/2006–6/2009)
 References
Schwartz, Ariel (2010). Sustainability Faceoff: McDonald’s vs. Starbucks. Retrieved on April
24, 2011 from http://www.fastcompany.com
Startz, S. (2009). McDonald’s Free Wi-Fi Should Worry Starbucks. BrandCannel.com. Retrieved
on April 21, 2011 from http://www.brandchannel.com
.