OAK BROOK, Ill. -- Responding to declining same-store sales, falling stock prices and a shrinking base of younger customers, McDonald's plans to vastly expand its "Create Your Taste" test platform, its most significant menu change since the rollout of breakfast more than 40 years ago, reported USA Today.
Create Your Taste lets customers skip the counter use tablet-like kiosks where they can customize everything about their burger or chicken sandwich, from the type of bun to the variety of cheese to the toppings and sauces that can go on it. (After promoting the program for months as "Build Your Own Burger," the chain scrapped that name when it added chicken as an option.)
The Oak Brook, Ill.-based company is immediately expanding what has been a test in four Southern California stores to 30 locations in five more states (Illinois, Wisconsin, Georgia, Missouri and Pennsylvania) and in 2015 to 2,000 U.S. locations, or about one in seven of the 14,000 domestic McDonald's restaurants, Greg Watson, senior vice president of U.S. menu innovation, told the newspaper.
Along with a higher price-tag, time is an issue, the report said. Because it takes at least four to seven minutes to prepare orders from the custom platform, it can't be sold at the drive-thru window, where many McDonald's do up to 70% of their business. Also, "Create Your Taste" will not fit in many smaller McDonald's locations, because it requires a separate assembly area.
Also, many older consumers are uncomfortable with the new technology, said the report.
This is the McDonald's of the present racing to become the McDonald's of the future, USA Today said. McDonald's is in the midst of reinventing itself, said Watson. It is modernizing the stores, and the way it sells and makes food is in flux.
"McDonald's is listening to the customer," he said. It is delving into a new frontier that's part fast-food and part fast-casual dining. "Maybe we're creating a new space," he said.
"McDonald's single biggest problem is its current positioning with millennials," Darren Tristano, executive vice president at Technomic, a restaurant industry research firm, told the paper. Teens and young adults continue to abandon McDonald's for what they perceive as fresher, healthier and more customizable menu choices at favorites such as Chipotle, Panera and Five Guys.
"Not one student I have asked since the start of classes this September believes that McDonald's has any healthy items on its menu," Christopher Muller, hospitality professor at Boston University, told USA Today. When he recently asked 75 students where they prefer to go for fast-food, not one picked McDonald's or Burger King. Two picked Wendy's. But roughly half said they preferred Chipotle, Panera and Starbucks.
"I think it is less that McDonald's has lost its way and more that a generation has simply left for a different destination," said Muller.
But McDonald's executives scoff at that. McDonald's attracts 27 million customers a day--a big chunk of them millennials, said Watson. "Millennials are still coming to McDonald's."
Click here to view the full USA Today report.
Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.