Ask yourself: what has changed in QSR’s in the last, say 40 years? Equipment, production time, family oriented, comfort…maybe? There has been nothing that comes to mind as great as the original drive-thru; literally redefining “quick” serve. It seems all other improvements have been a continuation of small adjustments. McDonald’s stakeholders have recently decided to change that. It was inevitable that sooner or later smartphone service to place orders would infiltrate the QSR operations program. McDonald’s is taking it a few steps further. They have realized a multi-tiered front from other existing/new QSRs, expanded growth in limited service restaurants (LSR), health based outfits, and third party delivery services.
In a concerted effort to combat these threats while staying relevant, trendy, and forward leaning, McDonald’s has several big initiatives to boost their presence among most competitors:
- Deploy their mobile app to allow guests to order and pay for meals via smartphone with restaurant pick up in 20,000 locations by end of 2017
- Re-introduce quality, convenience, and value
- Accelerate launch of “Experience of the Future”
The latter would consist of delivery service, table service, kiosk ordering, integration of mobile app, and interior modernity. The long term goal is to get all free-standing locations to this level by Q4 2020.
“Experience of the Future” has partially been realized by the McDonald’s brand and visually expressed by other QSR’s. Many leading national ASR brands have found value in competing with the aesthetics and comfort of fast casual restaurants. In fact, as 53% of the total restaurant market has been consumed by LSRs (QSR and fast casual), quick serves are now finding benefits in upping the store environments and menu selection. But few, if any, have adapted the game-changing element of delivery; most that deliver still depend on third party services (GrubHub, Foodler, Eat24).
If successful and implemented appropriately, McDonald’s poses the threat of re-revolutionizing the fast food industry with delivery. This has the potential to be the single greatest development for the company (and possibly all fast food) since the drive-thru (1975) was adapted. It may seem rather counterintuitive to rebrand their interiors while also offering a service which requires fewer people to visit the physical location. However, a strong argument can be made for the increasing variety of social, physical, and time-related conditions which make driving less desirable for some, while others make more concerted efforts to make a trip to McDonald’s an outing. By increasing service variety, interior comfortability, and quality menu selection, many of the outstanding profit gaps may be closed.
- With McDonald’s growing into a visionary corporation, have they lost the character and nostalgia that once brought so many customers through their doors?
- What are millennials’ views of fast food restaurants (especially in urban environments with vast food options) compared to baby boomers?
- Does the sophistication change the view of the brand? Draw new consumers?
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