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Restaurants rethink the drive-thru

Fast-food chains, and more fast casuals, are quickly upgrading their drive-thrus. It makes sense—that’s where the customers are.
Photograph courtesy of Jack in the Box

For all restaurants’ talk of mobile ordering, curbside service, delivery, kiosks and other strategies, the most tried-and-true way to provide a convenient experience is still just a hole in the wall. The drive-thru, which first emerged in the fast-food business in the 1960s, is still effective today, and maybe even more so. Many traditional quick-service chains generate more than two-thirds of their business through that window. And fast-casual chains that have added drive-thrus have found them to be instant sales generators.

The fact is, many restaurant visits are compulsive decisions made during a trip to work or school or on a vacation. In other words, these diners don’t have time to punch an order into an iPhone.

Restaurant chains, which have spent so much time and effort upgrading their technology, have started turning their attention to that window. They are adding second lanes and additional windows. They are upgrading technology. And in some cases, they are changing the meaning of what a drive-thru can be. “It may seem like a drive-thru,” says Tabassum Zalotrawala, chief development officer for Chipotle Mexican Grill, which is adding mobile-order drive-thru pickup windows called “Chipotlanes” to dozens of locations this year. “But I believe strongly that our version of the drive-thru allows us to keep our brand ethos.”

McDonald’s big play

The biggest restaurant brand in the world is taking aggressive steps to protect its drive-thru turf: Earlier this year, McDonald’s Corp. spent $300 million to buy a company that promises to make its menu boards fancier.The company’s acquisition of Dynamic Yield gives McDonald’s early access to technology that will suggest items based on the time of day or the season. And if the restaurant is busy, the menu board will be able to suggest sandwiches with simpler builds that are faster to make.

Essentially, it will make ordering in the drive-thru more like shopping on Amazon. “Introducing Dynamic Yield will provide us with a great opportunity to smooth the experience for customers in the drive-
thru, regardless of whether we know you or not,” CEO Steve Easterbrook said during a conference call in April. 

McDonald’s purchase of Dynamic Yield signaled a shift in focus. The company in recent years has been aggressively upgrading its in-restaurant experience, spending billions to add kiosks and table service. Those remodels are set to be largely complete by the end of next year. 


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Photograph courtesy of McDonald's

Photograph courtesy of McDonald's

McDonald’s doubled down on the drive-thru with its acquisition of Dynamic Yield.

But drive-thru is vital to the Chicago-based giant. It accounts for about 70% of its business. If its drive-thrus suffer, the entire business suffers. In fact, McDonald’s believes that its slower service in the drive-thru is a major culprit behind the company’s decline in traffic. Same-store customer count declined more than 2% last year, and those declines continued in the first quarter, even as same-store sales rose 4.5%. 

So it’s taking action. The company has focused on shrinking and simplifying its menu, ending its Signature Crafted Recipes line of burgers and chicken sandwiches, for instance. It’s also planning to reduce its breakfast menu. 

And it’s relying on more technology than just the recent acquisition. McDonald’s added other tech inside the drive-
thru to improve order accuracy and speed. It even held a contest in stores earlier this year to reduce service times. “We decided to kick off with a focus on drive-thru during peak hours at breakfast,” Easterbrook said. “We managed to reduce service times, which is really encouraging. The enthusiasm of the competitions was great. So we’re going to continue with a series of these throughout the year.”

Shifting remodels

McDonald’s is hardly the only chain shifting its focus to concentrate more on the drive-thru. Jack in the Box, its San Diego-based rival, has opted to simplify a planned remodel of some of its oldest restaurants to focus only on the drive-thru. Lenny Comma, CEO of the 2,200-unit chain, said in May that it made more financial sense to remodel just the drive-thru, rather than the entire restaurant. “We learned that the majority of the returns from a full remodel are coming through the drive-thru, where 70% of our business is generated,” Comma said. “We are reprioritizing our spending and shifting our focus to our drive-thru-of-the-future initiative to get most of the sales lift for smaller investments.”

The investments include items such as digital menu boards, more LED lighting and canopies. The company is still working on the final elements of that drive-thru effort and expects a systemwide rollout early next year. 

The improvements can make a real difference. Company executives said remodeled restaurants have generated sales lifts in the mid- to high single digits, with most of that coming through the drive-thru. 

Comma noted that even customers who go inside the chain’s restaurants are taking their food to go. That emphasizes the importance of convenience. “I don’t think the consumer is valuing all-new furniture and wall treatments and lighting as much as they’re going to value enhancements to the drive-thru and a more efficient pickup system at the counter,” Comma said.

Burger King and Tim Hortons are also looking at their drive-thrus. The chains are featuring digital menu boards in drive-thrus as part of their respective remodels. Both brands are owned by Restaurant Brands International.

“I don’t think the consumer is valuing all-new furniture and wall treatments and lighting as much as they’re going to value enhancements to the drive-thru.” —Lenny Comma, Jack in the Box

Fast-casual drive-thrus

Remember when fast-casual chains didn’t like drive-thrus? They’re not so resistant anymore. Fast casuals emerged more than a decade ago to focus mostly on dine-in customers. They tended to have slower service than their fast-food rivals and were frequently more experienced-based. As such, they targeted inline locations and didn’t bother with a window.

But many chains have seen a major shift in sales from dine-in to takeout—and that has made the window more appealing. That’s true for concepts such as The Habit Burger Grill: About half of its new units are being built with drive-thrus. “It’s been well-received,” CEO Russ Bendel said on an episode of Restaurant Business’ podcast, “A Deeper Dive.” “We’re bullish on them.” Drive-thrus, Bendel said, open up the universe of potential sites, enabling the company to target more rural areas with interstate access rather than 
focusing only on densely populated urban areas. 

He said consumers are willing to take a bit longer to get a higher-quality burger. “It really falls into that category of convenience,” Bendel said. “With today’s consumer, convenience trumps a lot of things.”

Maybe nothing can illustrate this trend toward more drive-thrus quite like fast-casual pizza. These chains, including major players Pie Five, Blaze Pizza and MOD Pizza, emerged as experiences, focused on enabling customers to customize their pizzas and then see them made in just a couple of minutes. But that demand for convenience has all three of these concepts looking at drive-thrus. “You build the love on-premise,” MOD CEO and co-founder Scott Svenson says. “But you have to be able to meet consumers’ increasing demands for convenience.”

That melding of customization and convenience is demonstrated via Chipotlanes. Leave it to Chipotle, the chain that helped rethink the idea of fast food, to rethink the idea of the drive-thru. The mobile lanes are not typical drive-thrus. Guests don’t drive up and order food from a menu board. Instead, customers pick up their orders placed via app or web through those lanes. That marries the idea of a drive-thru with more modern ordering strategies. It improves the convenience of that digital ordering, enabling customers to skip the line and get their order without taking away from that in-store experience. 

Chipotle customers can pick up mobile orders via the Chipotlane.

Photograph courtesy of Chipotle Mexican Grill

Photograph courtesy of Chipotle Mexican Grill

“They can customize their meal and we don’t lose the essence of what Chipotle stands for,” Zalotrawala says. “They never have to get out of their car. They choose the time to pick their food up. And it delivers well on the promise of speed and accuracy.” Just like a drive-thru is supposed to do.

 

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