Annie Jiang, in her blog post entitled, “McDonald’s Step Forward” suggests that increased competition (i.e. Chipotle, Panera, Wendy’s) and reduced comparable sales in the past decade, deems the McDonald’s fast food chain out-dated. Jiang summarizes how McDonald’s is looking into electronic; tablet based ordering, which would effectively reduce their labour costs. An innovative tablet-ordering system would not fix all of McDonald’s problems but it will attract a new customer segment and revolutionize the fast food industry. Forbes magazine rated McDonalds the number one fast food chain in the world in 2014. McDonalds is clearly ahead of its competitors but if they wish to stay on top they must continually develop their brand.
This is a prototype of how a tablet based ordering system would look.
Dollar Drink Days are one of McDonalds initiatives that separate them from there competitors.
In my opinion, McDonald’s will be most profitable by altering their menu and providing incentives for customers rather than developing innovative ordering techniques. In economic terms, McDonald’s is in a competitive fast food market in which the company with the lowest prices will draw the most customers. For example, the McCafe program has attracted more middle class consumers away from Starbucks. Why pay $5 for a large Starbucks coffee when McDonald’s is offering a similar product for $2.50. Furthermore, McDonald’s dollar drink policy was an innovative marketing strategy that exploited the average fountain drink station, which has a 90% return profit margin. A tablet-ordering system would offer an innovative technique, however after McDonald’s releases this technique competing companies will follow similar patterns. In summary, I agree with Annie Jiang that an innovative tablet ordering system would prove to be beneficial for McDonalds. However, I would personally recommend McDonalds to continue to develop marketing strategies such as the McCafe program and the dollar drink days in order to continually triumph in the fast food industry.
Additional Information: This link, shows how tablet ordering systems are developing in sit-down restaurants to give an idea of how the tablet idea has become a reality.
Sources Used:
Annie Jiang’s Blog Post Entitled: “McDonald’s Step Forward”
“Top 10 Global Fast-Food Chains.” Forbes 2014: n. pag. Print. Click Here: For Link