In the film The Founder, Michael Keaton plays the character of Ray Kroc, the business tycoon who liked to style himself as the founder of McDonald’s. Kroc took over the business in 1961 from the McDonald brothers (who built the first McDonald’s outlet), believing that speed and efficiency would trump quality, and franchised it around the country, turning the fledgling burger restaurant in San Bernardino, California, into a fast food giant.
Fast forward to the present, and in China McDonald’s is switching its focus to elevating quality and customer experience. Starting this month, patrons of the Golden Arches will find their food delivered to them by attentive waiting staff.
How it works is that once customers place their orders at new touch screens (less technologically-savvy patrons can still order food from the counter), they will be given a location device which they then take to their seat. When their food is ready, the device will guide the server to the table to deliver the food.
The waiters and waitresses will not only be in charge of bringing the food. They are also responsible for taking care of customers needs such as for extra ketchup or napkins. They will likewise explain new products and even play party host for children’s birthday events.
The Chinese conglomerate Citic, along with US private equity firm Carlyle, purchased an 80% stake in McDonald’s China operations for $2.1 billion in January (see WiC351). Analysts reckon that with Citic – one of the largest state-owned firms, now at the helm – the revamp is partly designed to create new jobs, as the rate of China’s economic growth slows. Last week the fast food chain launched a countrywide recruitment campaign with the aim of adding 70,000 new jobs, with the majority of them deployed to the new table service.
Job creation aside, the burger chain believes that the changes will draw in family business. “At the moment, table service is targeted at families with children. This is a way for parents to spend a bit more time with their kids,” Wang Jianjun, PR manager of McDonald’s Beijing operation, told TMT Post, a portal.
The table service is also an integral part of a revamp the company calls “Future 2.0”. Along with waiting staff, McDonald’s has rolled out “Create Your Taste”, which allows diners to choose from different kinds of meat, topping, and bun options at the self-service kiosk (albeit only in certain locations). In the past, the problem with allowing customers to customise their food was that it slowed down kitchen operations. Now McDonald’s is betting that customers will be more willing to wait that little bit longer if they are sitting at a table instead of standing at a counter.
The upgraded service is part of a plan to boost McDonald’s image and encourage higher spending. To reflect that, the fast food chain has recently rolled out a more exotic menu featuring creations from Spain’s Michelin-starred chef Ramon Freixa. First, there is a new burger topped with avocado (highly popular in China today, see WiC276), a fried egg and a slice of bacon that retails for Rmb28 ($4.06). And then there is the chicken sandwich that features a piece of fried chicken steak, a sesame seed bun and Mexican barbecue sauce.
So far, response has been positive. “I feel like all of a sudden, eating at McDonald’s doesn’t feel like eating fast food anymore,” one patron wrote online.
Rival Yum Brands is adopting a different strategy to deal with China’s rapidly changing fast food landscape. Just last week, the parent company of Pizza Hut and KFC announced plans to buy a controlling stake in Daojia, a delivery service, for an undisclosed amount, says Nanfang Daily.
The latest acquisition is consistent with Yum’s strategy to expand its online-to-offline business. Already, KFC is the largest restaurant operator in terms of online sales. Yum also controls one of the largest restaurant delivery networks in the country, with over 4,400 of its 7,663 restaurants offering delivery services as of the end of the first quarter of 2017. These accounted for 12% of Yum China’s sales, according to Sohu Technology.
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