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McDonald’s partners with Japanese wireless carrier for mobile payments promotion

By
November 12, 2015

Screen Shot 2015-11-11 at 3.32.34 PMMcDonald’s in Japan is partnering with wireless carrier NTT Docomo, enabling customers who pay at most of the chain’s 3,000 locations nationwide using the iD mobile payment platform to receive discounts on their purchases.

Starting next month, customers at McDonald’s who pay via Docomo’s iD mobile payment platform with one of the carrier’s credit cards will receive between a three-percent and eight-percent discount on the purchase when settling their monthly bill. Docomo and McDonald’s expect to announce other reciprocal customer benefits that will launch after April 1, 2016.

“Japan is a whole different ballgame than the U.S.,” said Drew Sievers, founding partner at fintech investor Operative Capital. “In Japan, the carriers, and particularly NTT, have quasi-monopolistic control that allows them to control the ecosystem in a way that U.S. carriers can’t.

“So, merchants partnering with Docomo is a necessity if the merchant wants to have mobile payments success in Japan,” he said.

Paying with mobile
From Dec. 1, 2015, to March 31, 2016, customers at McDonald’s in Japan who pay via the iD mobile payment platform with a Docomo credit card will receive a three-percent discount on the purchase when settling their monthly bill.

The promotion is available to the more than 54 million members of Docomo’s d Point Club loyalty program.

Also starting on Dec. 1, customers will be able to accumulate and redeem loyalty points by presenting their Docomo credit card at a cashier at approximately 100 McDonald’s locations in Tokyo. One d point, worth one yen, will be accumulated for every 100 yen spent.

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The points can be redeemed for purchases at McDonald’s or other participating retailers. Docomo subscribers can also use the points when settling their monthly bills or paying for new devices, online content or various services offered by the wireless carrier. The carrier and QSR chain expect to gradually expand the loyalty aspect of the program to additional locations.

McDonald’s customers who make iD mobile payments with any of Docomo’s credit cards will receive a total benefit of up to five percent.

McDonald’s varied approach
Through the month of December only, a special promotion will increase the benefit to eight percent for iD payments made with any of Docomo’s credit cards.

The program is likely to expand to include other mutually beneficial initiatives such as distribution d point cards at McDonald’s restaurants and to attract members.

The program is an example of how McDonald’s is actively pursuing a number of different mobile payments strategies as it looks to connect with the younger consumers who are its most loyal customers and heaviest mobile users.

The Japanese marketer is unusual in that Docomo has a strong enough hold on the mobile ecosystem that big brands such as McDonald’s are anxious to partner with it. In other markets, McDonald’s is typically partnering with the technology companies that are leading the way to mobile payments.

“In the U.S., the carriers lost control of the ecosystem to Apple and Google,” Mr. Sievers said. “Their failed attempts to drive payments via ISIS – renamed Softcard – fell flat as a result.

“There’s no doubt that the U.S. carriers would have loved to deploy their payment scheme in the same way as NTT Docomo,” he said. “Unfortunately for them, but fortunately for everyone else, their efforts failed.”

Final Take
Chantal Tode is senior editor on Mobile Commerce Daily, New York

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