McDonald's Experiments With Geo-Marketing in Georgia
As McDonald's struggles to capture the mobile Millennial demographic, the world's largest fast-food chain outfitted one city's franchises with beacon technology, with much success.
McDonald’s is the latest brand to tap into geo-marketing technology, having outfitted its franchises in Columbus, Georgia, with beacon technology.
The fast-food giant partnered with Piper, a San Diego, California-based beacon solutions provider, to deliver coupons to nearby consumers who opted-in on the McDonald’s app. The offers – consumers were able to customize which ones they received – varied, based on location.
All 17 of Columbus’ McDonald’s franchises participated in the four-week launch, sending iOS and Android users offers for McChicken sandwiches and 10-piece McNugget meals, in addition to alerts, photos, videos, and messages for customer surveys and employment opportunities that sent texts directly to store managers. During the launch, McDonald’s reported more than 18,000 redemptions. McChicken sales increased 8 percent; McNuggets, 7.5 percent.
Columbus is a relatively unknown city of 200,000 located 100 miles southwest of Atlanta and across the Chattahoochee River from Alabama. While the remote city might seem like a random place to launch a new campaign, according to local franchise owner Jack Pezold, beacon technology is deployed all over Georgia’s second-largest city, which is much savvier than people may realize.
“The Columbus, Georgia, co-op has been an aggressive adapter of technology for McDonald’s and was recently the national test market for the McDonald’s Mobile Ordering app,” Pezold says. “In addition to the local owner operator’s technology focus, it made sense for us and Piper because our strategy revolves around community-by-community deployment so we can get higher adoption rates for the areas we’re currently serving.”
By marketing to mobile devices, McDonald’s is able to reach more Millennials, a demographic the fast-food chain has struggled with recently.
“It’s hard for me to want to guess about what Millennials eat, but I do know the ability to reach people who have been specifically to your store is going to change everything,” says Howard Lerman, chief executive (CEO) of Yext, a software cloud that helps businesses manage their digital presence across search and map apps.
According to Lerman, the success of McDonald’s illustrates the power of beacons, which he refers to as “the Holy Grail of geo-marketing; it’s the bridge between offline and online.”
“Marketers never really had a good way to use digital marketing dollars to drive people in the store and geo-marketing enables that,” he adds. “My call is that this will end up being the most effective advertising channel since search.”
McDonald’s has seen positive results from its geo-marketing strategy, and plans to continue the campaign in the future. And it is not the only company jumping on the beacon trend: Starbucks is another brand that recently started sending location-based mobile ads, to its U.K. customers.
“Beacons are being sent to several other [McDonald’s] co-ops in the region with the possibility to several hundred stores coming online,” Pezold says. “We’re hoping to have a strong beacon program up-and-running across the Southeast in 2015.”
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