Thursday, May 3, 2018

McDonald’s Admits to Low App Adoption…But They’re Not the Only Ones

In last week’s McDonald’s Q1 2018 Earnings Call, CEO Steve Easterbrook revealed something about the fast food giant’s mobile strategy that most don’t openly admit–their mobile app adoption rates are low. While this isn’t a common admission from big brands like McDonald’s, it doesn’t mean they’re the only ones. Let’s dive into their app journey, and explore why adoption is still low for a fast food chain with such loyal customers.

Let’s Start from the Beginning
Well, from the beginning of the golden arches’ mobile journey, at least. In 2015, McDonald’s launched the McDonald’s Mobile app. In order to garner some early adoption, they offered a free sandwich to the first 8 million people to download the app, and allowed users to join a loyalty program that would allow users to earn free perks as they racked up rewards points. Months after its launch, McDonald’s reported 2 million downloads and 1.5 million offer redemptions.

Sounds Legit…But There’s More to the Story
While those may seem like solid numbers for the first few months of a brand new app (in 2015, mind you), there are a few more factors to consider here. First: the sheer number of customers McDonald’s locations in the U.S. serve. In 2015, the average monthly number of guests was more than 17 million. That means less than 10 percent of visitors downloaded and engaged with the app. Second: the fast food chain can’t pull the “lack of loyalty” card. They’ve literally got the most loyal customers in the industry–with the average McDonald’s customer frequenting the chain more than two times per month (that’s even more than the average Starbucks customer!).

If Loyalty Isn’t the Issue, Then What Is?
The biggest excuse for low app adoption has been a lack of loyalty. Of course I didn’t download their app! I’m only at that store once a month! I only use that product once a year! But in McDonald’s case…loyalty is the last thing on their minds, because it’s something they already do so well! So, what is preventing McDonald’s wildly loyal customers from downloading their app? According to last year’s ComScore U.S. Mobile App Report, app discovery is down across almost all channels–which means users just aren’t looking for and downloading apps like they used to. In fact, over half of smartphone users admit to downloading zero new apps per month. So…even if other brands aren’t admitting it as openly as McDonald’s, this trending consumer behavior toward “app fatigue” is affecting brands regardless of size and loyalty.

It’s clear…there’s a major shift happening in mobile. Even the most loyal customers are too fast-paced to go through the cumbersome process of finding, downloading, and updating a native mobile app. Today’s consumers are craving fast, instantaneous mobile experiences…and that’s exactly why so many big-name brands have started adopting web-based mobile experiences like Progressive Web Apps (and seeing better adoption and engagement!).

McDonald’s CEO Steve Easterbrook said it best in last week’s Earnings Call: “…it’s pretty inevitable that our customers will increasingly engage with us as a brand and business through their phones. So the fact that we’ve got a product out there that’s decent at the moment is an upside.” Who knows…maybe McDonald’s will catch on to the trend toward instantaneous mobile experiences, and take their decent mobile experience and make it something that will truly impress their loyal customers.