Mansoor is a member of the Azimut marketing team and specializes in digital content. When he's not writing about self service, Mansoor spends his time brewing coffee or cycling.
In this blog: How McDonald's pioneered the self service movement in the QSR industry and how other industries can learn from their example.
Self service technologies have trickled down into almost every industry over the past decade. Most notably, fast food restaurants have reported significant growth as a result of implementing self service technologies at their locations.
After retail stores and supermarkets reported success using self service kiosks to enable self checkout, restaurants and fast food establishments followed hoping to achieve a similar result. McDonald's was one of the first movers to adopt and implement this new technology on such a large scale.
Fast Food & Self Service
The average fast food consumer is extremely impatient; they expect food, fast! Beyond fast, they also seek convenience and an easy ordering process.
According to an NRF report, 97% of consumers will back out of their purchase decision if they face inconvenience in making that purchase. Fast food customers are not a fan of long queues; studies show that 75% of customers will simply leave if there are even seven people in line in front of them.
On the other hand, 90% customers said they would seek an alternative if there were ten people queueing in front of them. Supermarkets managed to alleviate queues and reduce time spent per customer significantly by using touch screen kiosks that enabled customers to scan their items, pay and checkout themselves.
Let's take a look at how McDonald's leveraged self service technologies to their advantage.
Maccas pioneered the self service revolution in fast food and went all in on self ordering technology when they learned how successful it had been in the retail industry.
In 2015, McDonald's began rolling out self ordering kiosks to its US locations and planned to populate all 14,000 franchises across the States with self service technology by the year 2020. Almost instantly after deploying these self service kiosks, McDonald's saw an incremental bump in sales; a 6% growth in sales in the first year after deploying self service.
McDonalds' Self Service Kiosks
So, how do these kiosks work? Well, McDonalds' implementation of the self ordering kiosk is quite simple, its a freestanding kiosk with a large touch display, a payment unit that accepts cards and a receipt printer.
One freestanding structure often has a kiosk mounted front and back to house as many kiosks as possible while maintaining comfortable distance between the freestanding structures.
The ordering application has a well designed UI with large clear images and text so visibility is not an issue. The touch capability makes the application easy to navigate; touching and swiping through just like a smartphone or tablet.
The self order kiosk has virtually eliminated human error while ordering because there are no communication gaps like there may be with the manual ordering process. Ordering through the kiosk is generally a lot quicker as well because you don't have to repeat your order or deal with any cash.
What About the Staff?
You may think that McDonald's may have replaced all the restaurant staff with kiosks since its so convenient, but no, McDonald's retained all the employees working in franchises behind the counters and those working the floors as well.
An addition of self service kiosks just improved efficiency and order accuracy while dividing foot traffic between the kiosks and order counters. Plus, employees are always required to assist first time users of the kiosks or older individuals.
Changing Consumer Behavior
For certain individuals, going up to a counter and ordering can be very anxiety inducing; "what am I going to order? What if they don't have what I want? Will they customize my order? How many people are there behind me?" are among some of the questions that might go through their heads as they wait in line for their turn, getting more and more anxious as they get closer to the counter.
When presented with the option of ordering via self service kiosk, there was an interesting shift in consumer behavior. Average order size increased by 20% and average order value at the time rose by 30%. Self service had dramatically changed how people act when ordering.
This increase in order value and size was credited to the kiosk's ability to upsell; customers who wouldn't normally buy drinks or dessert were now ordering these add-ons when the kiosk would offer.
This is because a cashier may forget their script and leave out the 'would you like fries with that', however a machine will never forget.
Delivery trends are also shifting; when presented with the option to order via an app or via phone call, most customers will choose apps without hesitation. When using apps, users tend to order more and use more features in general; they'll order more calories, more difficult-to-pronounce items, make more customizations and give more special instructions. When presented with options, customers will use them.
How Does This Affect Other Industries?
This omnichannel approach to QSR sales revolutionized the fast food industry, and other huge names like Starbucks and Subway were quick to capitalize on this opportunity as well. The case study of the QSR industry and its success with self service technologies serves as an example for other industries like banking and telecommunications.
These larger industries have been slow to implement self service and still they haven't achieved the scale that restaurants are at currently despite their ability and capacity to do so.
If we take McDonald's for example; in only a few years they managed to equip all of their 14,000 franchises in the US with self service kiosks and saw significant positive upticks in performance metrics like sales and AOV.
On the other hand, telecom companies have massive customer bases that could benefit from self service kiosks, however their implementation of sim dispensing kiosks and app integrations has been rather slow despite the clear demand.
McDonalds' success with self service is also proof that kiosks won't replace employees, they can work together to harmonize the flow of customers in and out of service centers in an even more efficient manner.
The situation is similar when it comes to banks. Banks have been using the same ATMs for decades now with little to no innovation in operational design. Some banks have slowly started rolling out CDMs and recyclers with cheque accepting capabilities, but again its slow and the scale is much smaller compared to QSR or retail industries.
Some Key Takeaways for Banks & Telecoms from Self Service
- Faster customer onboarding
- 24/7 operations
- Mobile app integration
- Mobile wallet integration
- Seamless Registration
- Full KYC capabilities
- Increased service offerings
So, the question then is, why don't more industries like banking and telecom invest in self service technology when there is a clear cut case in its favor? Well, the integrations and workflows for large financial institutions require more labor and development to successfully implement with apps and kiosks, not to mention the tedious process of implementing security protocols and data encryption.
This would have been a concern a few years ago, but today, self service solutions providers like Azimut are present globally to facilitate the transition of banks and telecoms towards digital stores and branches.
Azimut is a self service solutions provider that focuses on bringing you the best end to end solutions available in this ever growing industry. Azimut is part of the Wavetec Group, serving some of the largest banks, telecoms and mobile financial services providers in North America, Africa, and Central & Southeast Asia.