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
Brinker International has shifted the president of its Maggiano’s chain to a marketing and menu-development post at the company's core brand, Chili’s . As Chili’s EVP and chief marketing and...
2
Breakfast continues to be an area of growth and point of focus for operators across segments. But it’s no longer just reserved for the morning hours. Millennials are more interested in breakfast for...
3
Pie Five Pizza has pulled the plug on all eight of its Chicago locations this week as well as its locations in Minneapolis and Denver. The closures came with little notice. According to a statement...
4
Restaurants in Utah are mounting a last-ditch effort to prevent their state from becoming the first in the nation to limit how much alcohol people can drink and still legally drive to roughly one...
5
The parent of the Carl’s Jr. and Hardee’s burger chains has named Jason Marker, the former president of KFC’s domestic operations, to succeed Andy Puzder as CEO. Puzder, who has been CEO of CKE...
6
KFC has promoted Kevin Hochman, the creative force behind its offbeat multi-Colonel marketing strategy, to president and chief concept officer of the chain’s rebounding U.S. operations. He succeeds...
7
When Asian chain Wagamama opened its first New York City restaurant in November, it also launched its first brunch menu, starring a breakfast-inspired version of ramen. In scouting locations, Adam...
8
With the growing popularity of brunch, operators are turning to the bar—not just for dining room overflow or selling bloody marys, but as a focal point. Because whether diners are feeling social or...
9
Scratch-made biscuits are not new for Bojangles’. But as more restaurants tout housemade fare, the chicken concept realized it needed to communicate those claims more overtly. “As we go into new...
10
One of the industry’s boogeymen is a tightening labor market that seems to be snatching talented candidates from under hiring managers. “With historically low unemployment rates, you’ve got to move...