McDonald’s CEO: ‘We’re behind when it comes to tech’

McDonald’s CEO Steve Easterbrook says the brand fell behind in technology and is now having to play catch-up as it looks to use tech to improve the customer experience and boost engagement.

Mc Donalds

Speaking at the Bernstein annual strategic decisions conference, Easterbrook admitted the company was “a little bit behind” when it comes to incorporating technology within the business.

The brand has only recently introduced digital tills to 100 of its UK stores but, as part of its ‘Experience of the future’ programme, is hoping to introduce more innovations, including table service and wireless charging. However, brands like Starbucks have proven to be ahead of the curve, having introduced free Wi-Fi in all of its stores back in 2011. More recently, it launched a ‘Mobile Order & Pay’ feature and added wireless charging pads in 10 London shops.

Easterbrook recognises that McDonald’s needs to do more and is particularly keen to use technology to make the customer experience smoother, so that consumers can, for example, store their favourite meals on their phone so they don’t have to keep repeating orders when they visit.

“[We] can take some of the heavy lifting, the human element out and [offer] a smooth experience,” he said.

READ MORE: McDonald’s to roll out table service across UK as premium focus pays off

Easterbrook also believes tech can be about engaging consumers. It is doing this through partnerships with film studios, sport franchises and local communities to reach a diverse range of people.

“[It’s about] how can we put more fun into the experience, in a way that the customers themselves curate. There are certain people who care about certain elements but not about others,” he explained.

“We see technologies being an enabler of growth to smooth experience, as well as a driver, because we believe we can build a stronger relationship with our customers through technology than we can two 15-second interactions on a drive-through window.”

Copying the UK’s success

At the event Easterbrook also spoke about the success of the UK market, which has seen 40 quarters of consecutive growth. That is in marked contrast to some of McDonald’s other markets, including the US, where sales have been in decline. McDonald’s is attempting to turn that performance around and has seem some success, with global comparable sales growth of 6.2% in the first quarter of this year, while in the US, first quarter comparable sales increased 5.4%.

Easterbrook put the UK success down to the business being “customer obsessed”, something he said most businesses try to be but very few “truly live”.

“You will hear a whole bunch of people like me sitting up here and talking about being customer obsessed or customer led and every retailer in consumer facing business will say that, but very few truly live it,” he commented.

“The UK market more comprehensively and consistently builds their plans against consumer needs, against the core consumer segment and then has a discipline of executions. So in a way [it’s] not so inspiring as some of the other markets we have around the world in terms of headline energy, but 40 consecutive quarter is a pretty good effort.”

Learning from past mistakes

Also speaking at the event, McDonald’s CFO Kevin Ozan said the company is eager to learn from its past mistakes, admitting that it spent too much time worrying about what other companies are doing rather than coming up with its own strategy.

“The fortunes of different companies ebb and flow, but the reality is [the market] is always competitive. Perhaps we spent too much time in fairly recent history looking at what other people are doing as opposed to charting our own course,” he said.

“I want every single market in the world to win market share, and I don’t really mind where that share comes from, because different markets in the world will have different competitors at different stages. If you are gaining share and if the market as a whole is growing, then we will certainly get strong growth.”

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