McDonald's plans to launch a loyalty program

mcdonalds exterior

McDonald’s is planning to roll out its first national loyalty program when it revises its smartphone app around the turn of the year, according to reports from a financial conference today in Boston.

The program will reward customers for their visits or transactions with redeemable points that could expire at the end of each month, McDonald’s U.S.A. president Mike Andres told investors.

A similar program was introduced by Brinker International for its Chili’s casual-dining chain last spring. Points accumulated through purchases at a Chili’s expire after 120 days.

Brinker executives revealed at the end of 2015 that the loyalty program figured into 16 percent of transactions, though it was not clear if they were referring to the redemption or accumulation of points. But they acknowledged that the program had failed at least in its early months to deliver the expected sales gains, prompting the chain to resort to more advertising-focused promotions. Executives explained that servers focused on enlisting new members of the program rather than selling a dessert or an extra drink.

McDonald’s included a loyalty-program capability when it rolled out an updated app last year. However, the function was only available for beverage purchases in selected markets.

App-based loyalty programs have proven a business booster for such chains as Starbucks and Dunkin’ Donuts.

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