McDonalds begins testing Mobile Order & Pay ahead of nationwide launch

McDonalds 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 toother international markets by years end.

Initially, mobile ordering is available in 29 restaurants in Monterey and Salinas, California, through the companys mobile application.The test will then expand to 51 more restaurants in Spokane, Washington on March 20, McDonalds says.

By Q4 2017, McDonalds plans to have mobile ordering live in its 14,000 U.S. restaurants. In addition, 6,000 others inCanada, the U.K., France, Germany, Australia and China will receive the technology by years end, Reuters noted.

The McDonalds 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, McDonalds uses geo-fencing technology to track the customers location, so their food is only prepared when theyre 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 McDonalds 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 its certainly known to be quick.

However, for larger orders, mobile ordering has an advantage. McDonalds 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 orderingcustomers can choose to pick up their food by walking in to the counter, going through the drive-thru or via newly added curbside delivery, McDonalds 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 Dominos 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 didnt specifically look at mobile ordering, we should note, but examined online ordering technology trends in general.)

For a chain like McDonalds, which has been struggling in a new erawhere people increasingly care about how their food is produced, its 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 improvesales at chains, including Starbucks, Taco Bell and Dominos, 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 McDonalds foods, says Julia Vander Ploeg, McDonalds vice president of U.S. Digital, in a statement. From the app to our restaurant operations, weve taken a fully integrated approach to ensure a seamless customer experience that we think our customers will love.

Mobile order and pay isnt the only technology McDonalds 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.

McDonalds tells us it has begun delivery tests in the U.S.with UberEATS in the Florida markets of Miami, Orlando and Tampa Bay.

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