McDonald’s CEO: Personalisation is key in driving greater frequency and spend

 

McDonald’s plans to drive frequency by leveraging its digital and personalisation capabilities within its loyalty programmes.

Speaking to investors today (30 April), McDonald’s CEO Chris Kempczinski said the company has an “opportunity” to encourage existing customers to visit more often.

“With the insights powered by our loyalty members, we will work to deliver the right message at the right time to the right consumer, encouraging those who already love McDonald’s to visit even more,” he added.

Sales to loyalty members reached almost $25bn (£19.96bn) for the trailing 12-month period, and over $6bn (£4.79bn) for the three months to 31 March, the fast food giant said.

The company reported that increased loyalty sales and “record” mobile app orders have also played a role in driving digital penetration, resulting in “greater frequency and increased spending” by loyalty customers.

Investment in digital

Kempczinski said that shifting marketing investment from traditional mass media like television, print, and billboard ads to a “collective investment” in modern digital capabilities to “personalise the experience” will drive profitability for the company.

The company said it is investing in digital and technology that will drive long-term growth, adding it is leveraging its gamification learnings to grow its digital share.

For example, McDonald’s says it drove “strong” loyalty by reintroducing its ‘Winning Sips’ digital experience in the UK. This led to “increased customer engagement” in the mobile app. As a result, the company achieved “record growth” in 90-day active users, and nearly 75% of its total loyalty user base remained active during the last quarter.

Kempczinski cited efforts to engage the anime community, including the creation of a fictional restaurant named ‘WcDonald’s’ and the introduction of bonus gaming content on its mobile app. These initiatives led to a surge in McNugget sales, garnering 6 billion social media impressions and nearly 100,000 mentions.

We know our customers are looking for reliable, everyday value, now more than ever.

Chris Kempczinski, McDonald’s

“Breakthrough campaigns, a great tasting menu, and personalised experiences will drive customers to McDonald’s again and again as they come through the physical doors of our restaurant and the digital door of our mobile app,” he added.

Sales increased 1.9% for the quarter, compared to the same time last year, marking 13 consecutive quarters of positive comparable sales growth. Additionally, the company has experienced 30% growth over the last four years.

“This success was built by establishing a strong foundation with a strategic plan based in consumer insights, and focused on creating relevant marketing campaigns with our brand connected to culture,” Kempczinski added.

Customers value

Following on from a financially challenging 2023 for consumers, Kempczinski expects that 2024 will continue to see people be “more discriminating with their dollars”.

“We know our customers are looking for reliable, everyday value, now more than ever,” he said.

In response to mounting consumer pressures, he said the company has reacted with “agility” to meet “evolving customer needs”.

“Over the past year, we’ve launched everyday value menus across many of our international markets,” he referenced. “Featuring value bundles at various price points, these new offerings provide smaller, more affordable meals to our customers.”

Kempczinski cited the company’s ongoing efforts to “drive consumer interest” around marketing. He said that by achieving “great marketing”, the business can continue to expand solely with its core menu.

“We’ve got a marketing and brand engine that’s best in class,” he said. “The team continues to deliver great creative execution that’s resonating with customers in culturally relevant ways.”

As the company looks to the rest of 2024, Kempczinski said it remains focused on leveraging the “competitive advantages” of its ‘Accelerating the Arches’ plan and growing its market share to drive “long-term growth”.