McDonald’s implements modifications to boost mobile sales

McDonald’s U.S. franchisees will start contributing to a digital marketing fund next year as the company aims to expand its digital business. According to a memo from U.S. Customer Experience Officer Tariq Hassan and Chief Information Officer Whitney McGinnis, this change is part of an effort to modernize their marketing strategy and gain a competitive advantage. The company plans to invest hundreds of millions of dollars in the next few years to improve its loyalty program and add new ordering channels.

During the first quarter, loyalty program members generated over $6 billion in system-wide sales for McDonald’s globally. The company currently has 34 million active digital customers in the U.S., with a goal of reaching 100 million loyalty program members by 2027. By comparison, Chipotle Mexican Grill has 40 million loyalty members and Starbucks has 32.8 million.

Franchisees will fund the digital marketing fund by contributing 1.2% of projected identified digital sales, such as transactions through the loyalty program or delivery orders. The new approach is expected to lead to an increase in cash flow for every U.S. restaurant starting in 2025. This shift will allow McDonald’s to prioritize digital investments over traditional marketing tools like TV commercials, in an effort to drive higher sales.

McDonald’s U.K., Canada, Australia, and Germany franchisees will also contribute to the global digital marketing fund, with other markets to follow suit later on. This transition signals the company’s commitment to growing its digital business and adapting to changing consumer preferences in the fast-food industry.