McDonald’s gets some early results from its loyalty program

MyMcDonald’s Rewards is already one of the industry’s biggest programs as the company takes steps to know more of its customers.
McDonald's loyalty program
Photograph: Shutterstock

It’s amazing how quickly the world’s biggest restaurant company can bring a lot of people under its digital umbrella.

McDonald’s long-awaited loyalty program, MyMcDonald’s Rewards, has already become one of the industry’s most populous loyalty programs just a few months after its debut.

The company said this week that the program has 21 million total members, 15 million of whom are considered “active.”

That’s a fast debut, making it one of the industry’s largest programs. While it has a way to go before it can match chains like Chipotle, Domino’s and Starbucks that have more established loyalty efforts, McDonald’s omnipresence and the frequency with which customers use the chain could quickly reduce the gap.

CEO Chris Kempczinski this week called the program “an instant fan favorite” that is already generating results. The company cited MyMcDonald’s Rewards in part for its two-year same-store sales growth of 14.6% in the third quarter.

“We’re already seeing increased customer satisfaction and higher frequency among digital customers compared to nondigital,” Kempczinski said on Wednesday.

Major chain loyalty programs

Source: Company reports

Loyalty programs have become table stakes in the restaurant industry this year as companies push for more one-to-one methods of luring customers in the door. Companies also get more data on their customers and their behaviors, data that has proven invaluable for making decisions.

For McDonald’s, the potential benefit from loyalty is frequency. With nearly 14,000 U.S. restaurants that on average generate nearly $3 million in revenue per year, it’s not as if the company needs to make people more aware of its existence.

“In the markets where we operate, roughly 80% of the population visits a McDonald’s once a year,” Kempczinski said. “So it’s not that we have reach opportunity. It’s about driving frequency in the business.”

Loyalty programs reward customers based on the number of times they use the restaurant. Kempczinski said that its global markets that have opened their loyalty programs have seen visits pick up from existing customers.

The bigger long-term potential, however, is with the data these customers provide—which is the biggest reason why restaurant chains have been pushing loyalty harder than ever this year and are giving out more free menu items to get customers to sign up.

By establishing its loyalty program, McDonald’s has an opportunity to know more about its individual customers.

At the moment, Kempczinski said, McDonald’s knows who just 5% of its customers are. The company wants to get that percentage to 40.

“And then you can imagine all sorts of things that you’re able to learn about customers and their preferences when you’re able to get more of your transactions where you know who the customer is,” Kempczinski said. “Loyalty is certainly the way that you get that customer to engage and share information with you.”

Unsurprisingly, McDonald’s wants to see its loyalty program take hold in more markets around the globe. The company said it expects to have loyalty started in its top six global markets by mid-2022.

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