McDonald’s began testing mobile ordering and payments on Wednesday in select U.S. markets — the first to receive the technology as part of a pilot test aimed at working out the kinks ahead of a full rollout across the U.S. and to other international markets by year’s end.
Initially, mobile ordering is available in 29 restaurants in Monterey and Salinas, California, through the company’s mobile application. The test will then expand to 51 more restaurants in Spokane, Washington on March 20, McDonald’s says.
By Q4 2017, McDonald’s plans to have mobile ordering live in its 14,000 U.S. restaurants. In addition, 6,000 others in Canada, the U.K., France, Germany, Australia and China will receive the technology by year’s end, Reuters noted.
The McDonald’s mobile app already allowed customers to browse the menu, check out the weekly deals, find nearby locations and more. But now it will begin to allow customers to place orders and pay within the app, as well, as mobile ordering becomes more broadly available.
Its implementation of the technology is a bit different from its fast food rivals. After customers place their order and pay in the app, McDonald’s uses geo-fencing technology to track the customer’s location, so their food is only prepared when they’re physically near the store. This will save the food from remaining under heat lamps for too long.
The time savings this will ultimately produce for some customers is questionable, as McDonald’s has already made a number of improvements to speed up its service over the years — especially through its drive-thrus. Its food may not be the best, but it’s certainly known to be quick.
However, for larger orders, mobile ordering has an advantage. McDonald’s tells us that the typical ordering process for 2-3 items takes 17 seconds on average at drive-thrus, but those with 8-10 items can take 50-100 seconds. Mobile ordering brings those averages back down to round 10-15 seconds.
Mobile ordering customers can choose to pick up their food by walking in to the counter, going through the drive-thru or via newly added curbside delivery, McDonald’s also says. At the drive-thru, customers simply give the order code to the crew, then pull forward to the pick-up window.
The larger goal with the pilot tests is to help work out any problems ahead of the nationwide rollout, as well as gain customer feedback.
The chain, surprisingly, has been behind the times when it comes to the shift to mobile.
Already a number of quick-serve restaurant competitors like Starbucks, Chipotle, Dunkin Donuts, Taco Bell, Chick-fil-A and other, smaller chains and local stores have introduced mobile ordering capabilities into their own apps. Plus, the major pizza delivery outfits have long since allowed customers to order on mobile — several are even testing new platforms, like Domino’s and Pizza Hut are now doing with Amazon Alexa.
Restaurants benefit from introducing mobile ordering into their applications, according to market research, to the tune of a boosted bottom line.
According to a Deloitte survey released this fall, the frequency of customer visits to fast food restaurants increases 6 percent and average spending rises around 20 percent when technology is used to place an order. (It didn’t specifically look at mobile ordering, we should note, but examined online ordering technology trends in general.)
For a chain like McDonald’s, which has been struggling in a new era where people increasingly care about how their food is produced, it’s odd that it has arrived so late to mobile ordering, given its promise of increased sales. While millennials and other younger users may now shun mass-produced food of questionable nutritional quality — in favor of “better burgers” and seemingly healthier fare — they do have a penchant for mobile ordering.
Mobile apps have been proven to improve sales at chains, including Starbucks, Taco Bell and Domino’s, reports have found. For example, mobile order and pay represents about 7 percent of Starbucks’ U.S. transactions, and mobile payments account for 27 percent of all its transactions, the company recently said.
“We look forward to learning from our customers in these markets as they order ahead, pay within the app and choose one of the various ways to pick up and enjoy their favorite McDonald’s foods,” says Julia Vander Ploeg, McDonald’s vice president of U.S. Digital, in a statement. “From the app to our restaurant operations, we’ve taken a fully integrated approach to ensure a seamless customer experience that we think our customers will love.”
Mobile order and pay isn’t the only technology McDonald’s is testing to reach new customers in the digital age. A recent filing stated that it is also experimenting with delivery, including through partnerships with third-party services worldwide.
McDonald’s tells us it has begun delivery tests in the U.S. with UberEATS in the Florida markets of Miami, Orlando and Tampa Bay.