Though many restaurants have struggled during the coronavirus pandemic, McDonald's (NYSE: MCD), like other fast food joints, has fared pretty well. But much of that has to do with the fact many customers visit McDonald's to grab food in a hurry. And now, the burger giant is making plans to expedite the ordering process even more.
Bye bye, humans
For McDonald's, 70% of its sales come from drive-thru orders, so it pays for the company to invest in ways to make that system more efficient. Enter artificial intelligence.
McDonald's is in the process of replacing some of its drive-thru employees with computers that will welcome customers and be linked to a digital menu drivers can order from. The goal is to speed up the drive-thru line and prevent human error from slowing things down.
While it's easy to argue live employees make for a better drive-thru experience, those same employees can also botch orders or mishear customers. They can also forget to greet customers or wish them a good day. Using a system of AI and digital menus should help reduce incorrect orders and move customers along while ensuring they have a pleasant ordering experience.
In 2019, the average McDonald's drive-thru order took six minutes and 18 seconds to complete, but the company managed to shrink that to five minutes and 49 seconds in 2020, when drive-thru ordering really picked up. Getting that turnaround time down even further could work wonders for McDonald's -- and a host of other fast food establishments that rely on drive-thrus for a lot of their business.
The start of a trend?
A number of popular fast food chains have experimented with new designs in the course of the pandemic, and the common denominator is that they're all looking for ways to move customers through the premises faster. Chipotle (NYSE: CMG), for example, recently opened its first digital-only restaurant where customers order meals ahead of time, grab them, and go rather than congregate at tables and take their time eating. And both McDonald's and Burger King, a Restaurant Brands International (NYSE: QSR) chain, have introduced new designs that make for a better drive-thru experience.
It therefore stands to reason that we could see a shift to machines over humans in the drive-thru lanes not just from McDonald's, but from comparable fast food restaurants as well. Of course, if this new setup helps McDonald's and other chains like it boost their revenue, it could lead to more drive-thru locations -- which real estate investors could potentially benefit from in the form of scoring tenants (though it's worth noting McDonald's actually owns its own real estate and derives a lot of its revenue from rental income).
Of course, the one thing that might stop a shift from humans to machines at the drive-thru is unreliable programming. Buggy software could leave a lot of customers with burgers instead of nuggets and the wrong beverages and sides. But if this type of AI goes off without a hitch, it could eventually change the drive-thru experience on a national level.