McDonald’s reveals Next Gen to-go model

mcdonalds

McDonald’s is adding curbside delivery and altering how customers place drive-thru orders as part of a revised long-term strategy revealed today to investors.

The plan also included a pledge to make McDonald’s “the global leader” in delivery through arrangements with third-party services, and accelerating the conversion of restaurants to a new high-tech, kiosk-studded format, with a goal of completion within the U.S. by 2020. 

The program’s end goal is increasing customer counts, according to executives. They set three pillars to the approach: hold onto current patrons; win back consumers who defected to other restaurant brands during McDonald’s recent struggles; and boost the frequency of what they called casual customers.

Technology will be key to the effort, not only as a way of speeding service but also providing more leeway for customization, indicated CEO Steve Easterbrook.

To-go customers who want to personalize their orders will be able to spec a complex order via a smartphone and then pull into an area in the parking lot where the food will be brought to them.

If patrons prefer to use the drive-thru, they can still input the personalized order via their phones and provide a code to the employee at the other end of the drive-up microphone. In that setup, the order can be highly customized without the need for the customer to painstakingly place the order, have it checked by the kitchen staffer, and then executed.

Digital technology will also converge for customers at in-store kiosks, which McDonald’s is already installing in selected stores. Recognition technology will enable the kiosk to “read” a signal from regular customers’ phones, suggest patrons’ favorite orders, and default to the guests’ usual method of payment.

The kiosks are an underpinning of what McDonald’s is calling the Experience of the Future, a new way of using the Golden Arches. McDonald’s has revealed that stores given an Experience of the Future facelift tend to see a sales increase in the mid-single digits.

Executives said the significant capital expenditure of updating all restaurants will come from the proceeds of selling company stores to franchisees. The agenda calls for refranchising 4,000 restaurants by 2018.

Under the new accelerated renovation scheduled, McDonald’s said it would give 650 stores the Experience of the Future facelift this year, for a year-end tally of 2,500 updated branches.

The pledge to become the leader in delivery came a day after Domino's Pizza, a pioneer and still a leader in that form of service, posted domestic same-store sales gains of 12.2% for the fourth quarter of 2016. McDonald’s U.S. comps for the same period were 1.3%. 

Technology has also figured prominently in Domino's strategy for growing off-premise sales.

Today's top stories

1
Domino’s proved once again it’s dodging the sales slowdown hamstringing other restaurant operations, posting a 10.2% domestic same-store sales gain for the first quarter. The leap in sales follows a...
2
The Food and Drug Administration is pushing back enforcement of menu labeling requirements for chain restaurants and retailers from the scheduled start day of May 5, according to a group lobbying for...
3
Cash may still be king, but a huge asterisk is being slapped atop that truism as it applies to restaurants. The number of places looking to forgo currency and accept only cashless payments, and app-...
4
It is a commendable goal to look at performance metrics to make sure your employees are performing to their potential and have incentive to excel. On the surface, there is nothing preventing an...
5
Much like food trucks before them, food halls are the new go-to format for incubating a restaurant concept. Andrew Gruel knows this well. Gruel’s California-based fast-casual sustainable fish chain...
6
After revealing dramatic indications that a sales rebound is underway , Chipotle acknowledged more misfortune yesterday, warning customers that some personal information may have been swiped by...
7
Chipotle proved today its recovery drive is finding traction , posting a same-store sales gain of 17.8% for the first quarter of 2017 and an expansion of store-level operating margins to 17.7%,...
8
With more consumers expressing an interest in “free-from” foods and wanting to know the origin of their next meal, operators across segments are taking a more transparent approach to menu creation...
9
Consumers continue to show interest in clean, natural ingredients on restaurant menus. It’s easy to see why: Mandatory nutrition labeling for chain restaurant menus has pushed the idea of...
10
Burgers are a major part of foodservice business, with more than 50 billion served each year. That's why burgers, although highly popular, are an area that is ripe for innovation. Chefs who are...