New MyMacca’s app loyalty program coming to Australia

McDonald’s fans in Australia can now get free stuff for simply eating at Macca’s. The chain restaurant will expect one thing in return though.

Macca’s has a clever plan to get you to spend more money in the golden arches. But first, they want to give you a free large fries. A new loyalty program is coming to Australia, and if what they’ve learned overseas applies, it will more than pay for the cost of an enticing introductory freebie.

The McDonald’s loyalty program will be called MyMacca’s rewards. It is being trialled in South Australia and will be rolled out nationwide next year. You get points and you can spend them on menu items. Spend $50, for example, and you have enough points for a free large fries.

Loyalty programs are hardly new. The profits of Qantas Frequent Flyer program is almost higher than of their actual Qantas airline. And Coles and Woolworths love to keep us coming back with Fly-Buys and Everyday Rewards. Coffee shops have had those little cards you get the stamps on. But now Macca’s is entering the arena, and they are going in hard.

Macca’s is going to unveil the MyMacca’s loyalty program in Australia. Picture: Macca’s.

What’s the point of a loyalty scheme? A vast majority of us eat at Macca’s every year, so they hardly need to educate people about the existence of their restaurant. What they do want is for people to come in more often.

“In the markets where we operate roughly 80 per cent of the population visits a McDonald’s once a year, so it’s not that we have a reach opportunity, it’s about driving frequency in this business.” said McDonald’s CEO Chris Kempczinski.

“And we’ve seen in the places where we have deployed loyalty that it absolutely does increase customer frequency so for us that is really encouraging,”

Germany got its McLoyalty program last year. The UK are having theirs rolled out soon. France has had one for years.

The hope is that MyMacca’s will see people coming back for more.

Data is king

The upside for McDonald’s is they get data on who’s buying what.

“We had set out earlier an aspiration: we wanted to have 40 per cent of our customers be known customers, Today that number is probably only about 5 per cent of the customers where we actually know who is the customer, what did they buy, what did they buy previously?” explained CEO Chris Kempczinski.

“You can imagine all sorts of things you are able to learn about customers and their preferences when you’re able to get more and more of the transactions where you are able to where you know who the customer is. And loyalty is how you get the customer to engage and share information with you.”

That data feeds into their big spreadsheets that tell them which products to discontinue (anyone remember the McFeast?) and what sort of things to introduce (when they bring in a Spicy McChicken, a Double McSpicy, Spicy McPieces and a Cheese and Bacon McSpicy, it’s because the data is telling them that is a brilliant idea.) The data also tells them where they should cut prices, and where they can safely raise them.

Data will drive new product launches and what gets the chop.

Macca’s price hikes

Would McDonald’s want to raise prices? You betcha.

In the US, prices have gone up 6 per cent this year, according to McDonald’s chief financial officer Kevin Ozan, “to cover both labour cost pressures and commodity cost pressures.”

McDonald’s Australia hasn’t seen big price hikes yet, or supply disruptions, but as we know, inflation in Australia is elevated right now. While wages haven’t gone up yet, petrol is at record highs, and the latest consumer price inflation index came in higher than expected, freaking out economists.

What’s more, the latest measure of import prices rose 5.4 per cent in the last three months alone. That will take a little while to flow through to consumer prices, but it should have some effect eventually.

I still remember when a 30 cent cone cost 30 cents … now it’s 75 cents. If Macca’s are going to put prices up, they may need every bit of loyalty they can get.

Jason Murphy is an economist | @jasemurphy. He is the author of the book Incentivology.