The future is here, and McDonald’s is in the midst of bringing their U.S. restaurants up to speed to meet it. In March 2017, during Investor Day in Chicago, the burger giant unveiled their plans for the Experience of the Future, coming soon to a McDonald’s near you. The plans include in-store ordering kiosks, curbside pickup, app-based mobile ordering, meal delivery, and a more modern dining environment.
Winning Back Customers
McDonald’s is one of the largest global brands. It’s the biggest franchiser on the planet, with over $82 billion in sales worldwide. But in recent years, McDonald’s has been losing customers in droves to other, more technologically savvy fast food restaurants. Millennials, who account for 25 percent of the U.S. population and enjoy over a trillion dollars in spending power, are largely behind this decline in business. While Millennials eat less fast food than other generations overall, they’re behind significant traffic and revenue increases at Chipotle, Panera, and Starbucks. These restaurants have a strong digital presence, a significant social conscience, and invest in high quality ingredients—three important factors for young people.
McDonald’s hopes that upping the technological ante and updating their decor will help drive business back to the Golden Arches. And indeed, the chain says that restaurants that have been renovated—complete with ordering kiosks—are enjoying sales increases of four to eight percent.
Ordering Made Easier
The ordering kiosks, which feature Samsung tablets, are central to the Experience of the Future. These easy-to-use, high-tech kiosks let you bypass the front counter and place your own order. The kiosks make customizing your order easier, and they help reduce human error. You simply choose your items on the screen, customize them, choose a table tent and enter the number, and go sit down. Soon, an employee delivers your order right to your table. Some restaurants mount the tablets right at the table, and in some locations, the tablets provide entertainment while you wait for your order.
Ordering kiosks have been installed in 2,400 U.S. stores so far, and McDonald’s plans to outfit all 14,000-plus stores with them by 2020.
Curbside Pickup and Meal Delivery
By the end of 2017, the mobile app will be fully operational everywhere in America and in around 20,000 stores outside of the U.S. Curbside pickup enables patrons to order through the mobile app and skip the drive-thru line altogether.
The meal delivery service is through third-party services like UberEats, and it’s currently in testing mode in Florida. According to McDonald’s, 75 percent of the U.S. population lives within three miles of a Golden Arches, making delivery fairly simple and convenient to implement. In China, South Korea, and Singapore, where delivery is an integral part of the business model, systemwide delivery sales reach nearly $1 billion a year.
Renovations for the 21st Century
The outdated, cafeteria-style decor of most McDonald’s restaurants is a turn-off for with-it Millennials and older folks on the hipper side of things. The Experience of the Future will bring restaurants across the country into the 21st Century with a more palatable decor and redesigned kitchens to speed up service.
Replacing the garish red and yellow plastic tables and chairs that are bolted to the floor will be sleek and modern furnishings. A modern, subdued color palette is far more appetizing and conducive to a laid-back, enjoyable dining experience. The McDonald’s style book is put together by a 36-person design team that partners with top design and branding firms in the U.S., Netherlands, and Australia. “Origin,” “Simply Modern,” “Fresh & Vibrant,” and “Living Room” are just a few of the styles restaurants can choose from.
Around 650 restaurants will be remodeled by the end of 2017, with an average price tag of $695,000 per store.
Only Time Will Tell
While McDonald’s expects the Experience of the Future to drive up sales, it’s uncertain whether the chain will regain its former status as the Golden Child of fast food joints. A recent survey by RBC Capital Markets found that consumers rate McDonald’s dead last in terms of food quality.
While improvements in technology and aesthetics are well and good, it may all boil down to food quality in the end. Although improvements in the quality of the food are on the horizon, only time will tell if McDonald’s Experience of the Future will be all it’s cracked up to be.