- McDonald’s and Starbucks are making major investments in mobile ordering apps.
- As foot traffic falls, chains are growing sales by convincing customers to order on their smartphones.
- We tried both McDonald’s and Starbucks‘ mobile apps – and discovered McDonald’s is catching up to Starbucks’ digital domination.
As foot traffic falls flat, chains are turning to mobile ordering in an attempt to boost sales.
The number of orders being placed via mobile apps skyrocketed by 50% in US restaurants in 2017, according to data from the NPD Group. And, Business Insider Intelligence predicts that by 2020, mobile order-ahead will account for 10.7% of all quick-service restaurant (QSR) sales.
So far, Starbucks has led the way in mobile order and pay. Mobile and other digital payments make up nearly a third of all of the coffee chain’s sales, and they account for even more of the company’s sales growth.
“Almost all of our same-store sales growth is from those customers that we have digital relationships with and those that are in our Starbucks Rewards program,” Starbucks CFO Scott Maw said at a JPMorgan forum in March.
Seeing Starbucks’ success, other chains are trying to cash in on mobile ordering. In 2017, McDonald’s announced plans to roll out mobile ordering at all US locations.
However, while mobile orders are intended to make ordering more convenient for customers, they can also create new issues. Starbucks has faced problems with overcrowding and bottlenecks in the past, though these seem to have been resolved with some behind-the-scenes changes.
With McDonald’s building out its more gourmet coffee offerings and Starbucks working to improve its food selection, the two biggest chains in the US by sales are competing more and more. So, we decided to see how their mobile-ordering apps measure up.
Here’s how the Starbucks and McDonald’s mobile ordering experiences compare:
Starbucks has spent the last few years perfecting its mobile order-and-pay system.
Starbucks’ most recent app update made it possible for all customers to order using its mobile apps. Previously, only Starbucks Rewards members with money preloaded into their accounts could use the chain’s mobile order-and-pay system.
The app interface is sleek and easy to use.
With most sales growth coming from its app, Starbucks needs to make it an enjoyable experience. The company’s current CEO, Kevin Johnson, actually came from the tech industry and spent 16 years at Microsoft.
One of the major perks of mobile ordering is customisation.
Fewer pumps of flavored syrup? Soy milk instead of two-per cent? Extra sugar that you’d be embarrassed to order out loud? Starbucks’ app makes it easy to customise, and it helps customers avoid yelling out nitpicky clarifications in a crowded coffee shop.
Typically, Starbucks says it will take two to five minutes for your order to be ready — an estimate that the chain increasingly achieves.
This wasn’t always the case. In January of last year, Starbucks reported that transactions – an important measure of customer traffic – had dropped by 2% in the most recent quarter, in part because of problems caused by mobile ordering.
Two months later, Business Insider visited the chain every day for a week and discovered a mess.
Orders that were supposed to take two to five minutes at a high-traffic location in Manhattan often took more than 10 minutes. Customers who were forced to wait were angry and complained on social media. Some even walked out without ordering or picking up their drinks.
However, in a more recent test, orders were ready within five minutes of being placed – just as promised.
Starbucks employees call out customers’ names before placing the labelled order in the pickup shelf.
Last spring, Starbucks rolled out pickup shelves for mobile orders so baristas wouldn’t have to waste time repeatedly calling out absent customers’ names. The app also now alerts customers when their order is ready.
Starbucks also shifted employees’ roles to improve the mobile-ordering experience, with some workers assigned exclusively to mobile-related tasks – such as handing off drinks – during busy hours.
In essence, Starbucks has spent the last few years perfecting its mobile app. That effort shows in a much improved mobile-ordering experience that is translating into actual sales.
McDonald’s mobile-ordering system is newer than Starbucks’.
The fast-food chain’s app isn’t as sleek as Starbucks’ – and it’s definitely more focused on deals. While Starbucks’ app also features deals, McDonald’s puts the discounts front and center.
Customisation is, once again, a major bonus — though the system has a few kinks it needs to work out.
The app allowed me to make changes that you can’t always manage while ordering in store, such as swapping the folded egg for the superior round egg in the McGriddle.
However, when ordering some of the deals, my app didn’t allow me to customise. This seems to have simply been a glitch that will get worked out as McDonald’s continues to improve the app.
One major difference between the two is the fact that you can’t finish placing your order until you are physically at McDonald’s.
Users can choose to pick up their mobile orders in-store, at the drive-thru, or curbside, depending on what their local McDonald’s offers. The McDonald’s near my office in Manhattan only has pick-up inside the restaurant as an available option.
Getting off the subway, I tried to click the “Inside the restaurant” pick-up option. However, McDonald’s app was able to sense I wasn’t yet at the location and refused to let me order until I was closer to the building – a feature that Starbucks does not have.
Because McDonald’s service is already speedy by necessity (thanks to the drive-thru), orders are typically ready in under five minutes. In most instances, it was even speedier than Starbucks.
When picking up in-store, mobile customers are given a number that appears on the location’s board. Initially, the number will appear in the “In Process” column before moving to the “Serving” list.
McDonald’s order pick-up was a hectic experience with employees yelling out the number assigned to orders, jumbled in among the meals of people who placed their orders in the location.
There are no niceties at McDonald’s – workers aren’t going to pretend to know your name. And, you need to be sure to be alert when they’re calling out orders, or you can get lost in the crowd.
However, McDonald’s doesn’t promise customers the relaxed, enjoyable experience that Starbucks does. It just has to be fast.
In that goal, it certainly succeeds. McDonald’s app is essentially a free pass to skip the line, with your order being placed behind the scene the moment you walk into the store. You can’t game the system by ordering ahead of time, but you’re never going to be waiting more than a few minutes.
Starbucks comes out on top in the mobile-order wars — but don’t count McDonald’s out just yet.
Starbucks’ app is sleeker that McDonald’s and a little easier to use. With nearly a third of all orders coming in through the app, Starbucks has figured out what works and how to get customers hooked on mobile ordering.
However, McDonald’s app is already very good at what it’s trying to do: speed up service and free up cashiers’ time. While Starbucks has the added pressure of trying to maintain a certain aesthetic and sense of community with its app, McDonald’s only needs to think about convenience.
As more people download McDonald’s app – especially people who value low prices and efficiency over aesthetics – the fast-food chain could give the coffee giant a run for its money.
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