Mickey D's goes uptown
New generation of McDonald's, complete with redone amenities and menu, is headed this way
By Jenn Abelson, Globe Staff | October 26, 2006
Did somebody say McSwanky?
The next generation of McDonald's are making their way into New England, and they're equipped with leather chairs, plasma televisions, and wireless Internet access.
"It's like the Starbucks cafe for moms," said Vanessa Simone , of Cohasset, as her children munched McNuggets and sat on stools at a newly rebuilt model in Weymouth. "But it's not like we're going to bring our laptops."
By year-end, McDonald's will have 10 of these stores in Massachusetts, and expects 20 to 30 more in New England annually in coming years. The "forever young" makeovers, as the company calls them, are part of the Golden Arches' strategy to reinvent itself by offering healthier food, premium coffee, and more payment options with credit and debit cards.
The overhauls are a key part of McDonald's effort to better compete with restaurants like Panera Bread that feature quick meals in a sophisticated setting, and to win back customers, especially young adults and families, analysts say. McDonald's new look, which includes recessed lighting and classical music, is also an attempt to boost sales by attracting a new type of customers who linger throughout the day in a cozy environment (hello Starbucks).
At the new store in North Weymouth, which has its grand reopening tomorrow, there are three distinct seating sections. There's the "fast" zone, which features tall counters with stools seats for customers who want to eat alone. The "social" section allows families and friends to gather around big tables in leather booths. And the "linger" zone offers a lounge area with sofas and armchairs.
"There's a growing trend where guests are looking for the total package -- convenience, price, quality, and comfortable environment," said Stuart Morris , president of QSR Consulting Group in Coronado, Calif. "McDonald's certainly wants to retain their core customers but recognizes future growth in the ability to attract guests who normally visit Starbucks, Applebee's, and Chipotle."
All 13,000 McDonald's US restaurants will eventually get the makeover, half of them getting some upgrades by year-end.
The 51-year-old fast-food giant hasn't had a major facelift in at least three decades, and the transformation isn't cheap. Franchisees can pay up to $400,000 to renovate and more than $1 million to tear down the iconic red mansard roof structure and replace it with a sleek brick and stucco building.
Not all McDonald's operators back the redesign, questioning whether the extensive interior renovations are worth the cost given that the average restaurant makes 65 percent of its revenue from drive-through sales, according to Richard Adams , a former McDonald's executive who now acts as a consultant for franchisees.
This year, a group of North Carolina franchisees sent a letter to management opposing the makeovers. Meanwhile, analysts say McDonald's upscale model could risk alienating core customers: kids and families. Some of the new "forever young" restaurants have reopened without a play area -- a move that McDonald's says addresses changing demographics in certain communities.
Despite these concerns, McDonald's, which has posted 41 consecutive months of sales growth, says it stands by its hipster redesign.
"We're happy with what we're seeing with the new buildings. We're seeing sales and guest counts go up wherever we've made the investment," said John Lambrechts , general manager and vice president of McDonald's Boston region. "This is in the best interest of the brand. Most of our franchisees would do this without any kind of threat of not being relicensed."
Peter Napoli , who operates about 20 McDonald's in New England, said he's seen sales increase nearly 50 percent after rebuilding his Leominster restaurant and reopening last month. He doesn't expect to sustain that level of growth, but he hopes to see a significant boost.
As part of the makeover, Napoli installed two side-by-side, drive-thru lanes and upgraded employees uniforms from polo shirts to crisp button-downs.
"We have to provide our customers more of what they need and want. And that's a more upscale look inside and out," Napoli said. "Change is important to move our business forward."
