Dive Brief:
- McDonald's has invested $3.7 million in New Zealand mobile app developer Plexure taking a 10% stake, about 13 million shares, in the company, according to Nation's Restaurant News.
- Funds from the investment will help Plexure's growth plans and give McDonald's "enhanced access" to the technology in the QSR space, including back-end and front-end features, customer functionality and targeting, according to a press release.
- This cash injection is the chain's first investment in a mobile app developer, according to the release.
Dive Insight:
This latest investment from McDonald's reveals a clear strategy to enhance its technological capabilities, which also includes remodels of stores with more self-order kiosks and digital signs. Last week, the company bought Dynamic Yield, a tech company focused on personalization and decision logic, to improve drive-thrus with personalized menus that will change depending on weather, time of day and popular items. Plexure currently powers a version of the chain's Global Mobile App in 48 countries outside of the U.S.
"Across all of our markets, we're using technology to elevate and transform the McDonald's customer experience," McDonald's president and CEO Steve Easterbrook said in a statement. "Our mobile apps play a key role in our digital acceleration, allowing customers to interact with us on their terms in a personal, customized way."
The investment will also give McDonald's a competitive edge. As part of the agreement with Plexure, the chain will get new service levels and pricing and Plexure will not provide services to a list of competitors in the QSR space, according to a release. This agreement could mean McDonald's will be the first to use new technologies that its competitors won't have access to. That will be big in a space quickly turning digital.
Having an enhanced mobile app and technologies can help drive brand awareness, allow customers to order ahead, and also collect customer data to create personalized experiences. It's also the future — digital restaurant ordering is expected to triple by 2020.
QSRs have been building up their mobile platforms to better stay ahead of the trend, and are reaping the benefits. Chipotle’s loyalty rewards program is driving significant app downloads and is expected to boost sales, according to CNBC. Burger King's Whopper Detour last year drove 1.5 million new downloads. Additionally, Shake Shack, Wendy's and Yum Brands also are expanding their digital capabilities.
For McDonald's, this new investment will help it get ahead of its competition around the world and drive sales in some of its biggest markets.
