News

McD's predicts sales boost from ordering kiosks

November 9, 2003

OAK BROOK, Ill. -- Service is a big issue for McDonald's Corp. today, and the company has turned to self-order kiosks to help satisfy customers and increase employee productivity. The company said initial results from the testing of its "My McD" self-order kiosks at two of its U.S. restaurants are "encouraging."

The fast-food chain predicted a sales increase next year of 3 percent to 5 percent, according to an article in The Chicago Daily Herald.

At the Morgan Stanley Global Consumer Conference in New York, McDonald's executive vice president and chief financial officer Matthew Paull acknowledged that service remains a major area for improvement, and said the kiosks are one way to address the problem by serving a high volume of customers in both English and Spanish, and by improving order accuracy.

According to the article, the kiosks are part of a revitalization plan McDonald's announced in April as an effort to improve its business. The kiosks, being tested in Raleigh and Colorado Springs, Colo., allow customers to place their orders by touching a screen. The food is brought to their tables.

Larry Miller, an analyst with Prudential Equity Group Inc., said McDonald's can improve service with kiosks, but said speed likely will not be affected.

"You'll be able to walk into a Playland and order from there, which is a benefit for mom," he said in the article. "And if you don't want to go to the counter, you can go straight to a kiosk. It'll seem faster because you don't have to interact with a human being, but it probably isn't."

Anna Rozenich, a McDonald's spokeswoman, said the company has a lot to learn before deciding where to go next with its kiosks.

At the conference, chairman and chief executive Jim Cantalupo said changes in consumer attitudes prompted new approaches to winning customers.

"We are in a world where the consumer is more fickle and more demanding," Cantalupo said. "So we have to keep an eye on changing trends and interests. We need marketing that's edgy, appealing and different."

See related stories, "Hot and now: kiosks in fast-food market," "McDonald's still experimenting with ordering kiosks."