Walid Fakih, General Manager at McDonald's UAE, was recently featured on the third installment of DMS’s webinar series, “Food for Thought''.
Moderated by COO Ziad Khammar, Food for Thought was born out of an internal initiative that brought together DMS team members with industry experts during lunch hour to share their unique business perspective and behind-the-scenes insight into the media industry. Realizing the value of these exchanges, the initiative was remolded into a monthly web series that offers rare access to some of the industry’s most exciting minds, inspirational innovators, and seasoned executives.
On the Road to Recovery (and Growing Competition)
The latest episode kicked off with Walid looking back on the impact of the Covid-19 pandemic, and particularly on McDonald’s road to recovery, which has been progressing at a remarkable pace, “faster than many other places around the world,” he declared.
“We're very lucky to be in the UAE. It's allowed us to recover the business in a way where we are making up for the losses last year, not having let go of a single employee,” he reflected, before adding that the business was growing further, with more and more stores popping up across the country as the company tries to shift from its reliance on food courts.
Walid further explains that the growth in demand for delivery that first emerged during the pandemic has been snowballing, with more concepts entering the fray -- whether brick and mortar, food retail stores, or cloud kitchens models. “We're competing against all these other players that never used to deliver, and now suddenly they do (...) It's become much more competitive.”
On Digital Transformation
The company's foray into digital started in 2013, when it launched a mobile app and a website for ordering. “Nothing like that existed anywhere in the market, we were very advanced at the time.” Yet Walid admits that the company is currently playing catch-up.
Walid was keen to highlight that the company is currently very much focused on encouraging the consumer to engage with the mobile application -- whether it's during delivery, drive-thru, or an in-person visit -- and that it has resorted to loyalty marketing to lure them onto its digital platform. The aim is to capture data, but the challenge lies in finding that “sweet spot”: a fair exchange of convenience and data between customer and company, he explained, before adding that by mid 2022, “we'll have transformed the experience to somewhere where I think it would be more enjoyable.”
At the same time, the company is working to fully digitize its drive-through service and leveraging technology to enhance customer experience with predictive analytics: “It will be a smart drive-through (...) it will know generally that when people order that item, what is it likely to be paired with.”
On Digital Media
The company has been progressively allocating more and more of its spend to digital. “Year on year,” he said, “more of our chunk of media spend and overall spend is going towards digital.” This is in part due to a McDonald’s practice that requires allotting a set proportion of revenues to media and marketing, “so it's slowly picking up its share of total spent,” he concluded.
When it came to assessing the effectiveness of media channels, “search is very important,” opined Walid, before citing digital media banners as effective tools as well. Regional TV space, on the other hand, is hard to leverage. That is because local channels across the region cater primarily to Arabic speakers. McDonald’s UAE’s customer pool, meanwhile, is mostly expats. “So we do a lot of locally produced TV content or digital video content,” he concluded.
When it comes to KPIs, “sales is the ultimate measure.” Walid declared. However, he did emphasize employing different campaigns with different purposes -- such as app downloads and brand awareness -- that drive growth ultimately. “It's a separate ball game altogether,” he explained. Such campaigns aren’t attributed to any kind of direct sales, instead, “we have metrics that tell us how we are doing in terms of brand score.”
Walid says that the plan has not changed in terms of long-term strategy. There will be a lot of investment on new store development, re-imaging, and digital he said. “The transformation is going to continue, even internally when it comes to what we do in the office.” Furthermore, in light of the rise in cases of digital fraud, Walid singled out IT security as another area of focus going forward.
And how does he see McDonald’s 10 years from now? “Honestly, something totally different,” he replied. As he tries to imagine what the business could look like, Walid supposes that the indoor dining experience will be completely different. Registers will be a thing of the past he presumed. "You order through your phone, or simply walk into a restaurant and your order is already suggested for you as you approach a digital kiosk. It's not going to be anywhere near what we see today.”
The delivery market will witness a radical transformation too. “In the next three to five years, I think consumers in general are going to tone down the delivery habit and go back to more on premise dining or meals prepared at home.” And that means that the whole approach to delivery as a service could change.
As for the last question of the interview, Walid was asked what he would do if he were global CEO. “It’s difficult to answer that,” he pondered. After a bit of reflection, Walid opined that, ideally, he would like to see that the company always delivers a best-in-class user experience when it comes to any digital interaction with McDonald's, while simultaneously elevating the indoor experience to have a consistent flow and feel.