McDonald’s attempts mobile comeback with US app rollout
McDonald’s is tiptoeing behind its competitors by rolling out a mobile application to United States consumers this fall, but could reclaim some of its flagging revenue with in-app coupons.
During its second quarter earnings call, the fast food marketer claimed it is testing mobile ordering for U.S. markets and will introduce a mobile app for domestic customers, adding to its plentiful mobile offerings abroad. While offering mobile coupons and deals in a branded application is likely a smart move for the chain, McDonald’s is still lagging behind other competitors who have now turned their efforts to wearables and mobile delivery.
“The harsh reality of mobile apps is that the later something is rolled out, the harder it is to get consumers to download it,” said Shuli Lowy, marketing director at Ping Mobile, New York. “While McDonald’s enthusiasts will be excited to order through the app when it comes out, the app will not have as easy of a time gaining the level of traction that competitor apps have.
“That’s because as time goes on more apps come to the market and it becomes harder to grab consumer attention in the mobile ecosystem,” she said. “This late rollout is not occurring because McDonald’s hasn’t been attentive to mobile entirely.
“In fact, McDonald’s has been fairly innovative in the breadth of its mobile advertising campaigns—understanding that mobile is a major touch point for its customer.”
While McDonald’s currently offers mobile applications in several foreign markets, such as Britain, this will mark the first time that fans will be able to receive coupons within a branded app rather than a third-party marketer.
The ability to receive discounts on the fast food chain’s menu items may convince some users to download the app, while others may prefer using third-party services such as CouponSherpa or RetailMeNot to search for weekly promotions.
Mobile coupons are rising in popularity as consumers eschew the hassle and potential of misplacing paper coupons.
However, McDonald’s may face some challenges in introducing its app to a national audience in a tight timeframe.
“Rolling out a cool mobile advertising campaign is very different than rolling out a fully functional mobile commerce system,” Ms. Lowy said. “A mobile advertising campaign can be fully completed and run at a corporate marketing level.
“Introducing a commerce solution requires massive amounts of local training and substantial investment in local POS hardware.”
McDonald’s also claims it is partnering with Google to test hands-free technology that would enable consumers to order and pay for food without pulling out a smartphone.
One key area that the new McDonald’s app will likely expand on is loyalty and rewards for frequent customers.
“A loyalty app is a crucial tool for any QSR,” said Karyn Andrade Bordoni, marketing manager at Mowingo, Los Altos, CA. “McD App, developed by Mowingo and used by McDonald’s in 18 markets, over the last three years, has generated phenomenal results, increasing the frequency and order size for millions of guests.
“The new app is a natural evolution of McD App and an effort to standardize their app roadmap globally,” she said. “We are very proud that the platform that will manage the offers for the new app, worldwide, was developed and will be continually enhanced by Mowingo.”
The fast food marketer has been racing to catch up with competitors such as Taco Bell and Chipotle, which are expanding their reach to all mobile devices, including wearables, and efforts including mobile-equipped delivery.
McDonald’s recently announced it is joining the shift towards mobile delivery by partnering with the Postmates app for a test at 88 New York locations (see story).
This past May, McDonald’s also asked fans in Northern California to text or tweet their nominations for who should receive a free breakfast delivered by McDonald’s employees, pointing to how mobile is at the center of efforts to surprise and delight consumers (see story).
“Obviously, down the road, the app will include additional elements, beyond offers, but we are not at liberty to disclose these future features,” Ms. Bordoni said. “I can tell you, without tying it to a specific client, that beacons will play a major role in the customer journey for all retail sectors.”
Alex Samuely is an editorial assistant on Mobile Commerce Daily, New York