The company said it will spend $1 billion to renovate and refurbish most of its 1,400 restaurants across the country. It is the biggest transformation in the company's 44-year Canadian history.
That means bringing free and unlimited Wi-Fi access, fireplaces, flat-screen televisions, double-lane drive-thrus and interior stone and tile accents in a bid to modernize the chain, which has been battling to gain market share against coffee and doughnut chain Tim Hortons Inc.
Tim Hortons, which became the country's biggest quick-service restaurant chain in 2002, began gaining its fast-food foothold when it expanded its breakfast and lunch menus more than a decade ago.
Many of McDonald's new innovations announced Wednesday were tested in Vancouver restaurants during the 2010 Olympics.
"During the Olympics, we put our best foot forward," John Betts, president and CEO of McDonald's Canada, said in an interview, citing softer seating materials and accent lighting as examples.
Betts said that "strong and sustained" business growth in recent years has allowed the company to invest heavily in improving restaurant ambience and service, while introducing new menu items.
Betts said the change is all about "brand transformation," and that competition from Hortons and other chains was not part of the decision. "Our mission is to be Canada's favourite place and way to eat and drink."
However, Mark von Schellwitz, vice-president, Western Canada, Canadian Restaurant and Foodservices Association, said in an interview that the $1 billion investment shows how competitive the marketplace is.
"This is a big investment. It's something McDonald's feels it has to do."
A franchisee sold to the McDonald’s corporation the 39 restaurants he had owned. He still owns six franchise locations in Calgary.
Sabrina Paquette, 18, who was dining Wednesday at the Crowfoot McDonald’s with George Bermudez, 19, and Chris Costea, 20, said she welcomes the changes that are coming to the restaurants.
“It makes you want to come more often,” she said.
Bermudez said the changes to the image of McDonald’s are needed and Costea said he too welcomes a new style and design.
“That will attract the young people,” said Costea. “It’s a fast place so it’s clean. For a fast (food) place that matters a lot. You trust the quality more. Definitely good changes.”
David Finch, assistant professor of marketing at the Bissett School of Business at Mount Royal University, said McDonald’s started the transformation in Europe a few years ago.
“It’s about keeping fresh, obviously,” he said. “Being stale in the quick service industry is not a good place to be. In Canada, we have very unique dynamics. We have obviously Starbucks on one side but we also have Tim Hortons on the other which is a very unique Canadian brand.
“For McDonald’s in the Canadian context, it has to really find that sweet spot. On one side, make an environment that can appeal to the people that may want to slide down to a Starbucks. But simultaneously create a unique presence in the marketplace that they can pull people away from Tim Hortons which is inherently very difficult because of the iconic nature of the Canadian identity Tim Hortons holds.”
He said that at the end of the day they are all vying for the same consumer wallet.
McDonald’s said there will be new interior and exterior designs, including prominent fireplaces, flat-screen televisions, stone and tile accents, as well as wood tones and colourful wall graphics.
Dining rooms are divided into separate eating areas for larger groups, on-the-go customers, families, or for individuals who want to stay, relax and enjoy amenities such as free and unlimited Wi-Fi, said McDonald’s.
There will also be the addition of double-lane drive-thrus in many locations.
“McDonald’s is changing as our customers’ needs are changing and we’re committed like never before to staying connected and relevant to them,” said Betts.
More than half of the company’s restaurants will have been renovated by the end of this year, with plans to have the majority of its remaining restaurants transformed by the end of 2012.
McDonald’s Restaurants of Canada Limited and its Canadian franchisees own and operate more than 1,400 restaurants and employ more than 80,000 Canadians coast-to-coast.
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