McDonald's Q2 earnings call today delivered the ultimate proof of a thesis I've argued for years: their loyalty program isn't really a "loyalty" driver, it's a digital discount delivery vehicle.
Back in August 2025 (math here) and again earlier this year, I did the math on management's repeated claim that non-members jump from 10.5 to 26 annual visits after joining MyMcDonald's Rewards. The math simply doesn't work. It requires a total user pool larger than the entire U.S. population.
In April, when McDonald's quietly devalued its rewards currency by ~13%, I pointed out at the time that high-frequency QSRs were shifting away from point generosity and toward app-based promotional deals.
Today, the numbers and executive statements caught up to the reality:
- U.S. Same-Store Sales: Stalled at 0.8% (with negative overall guest traffic)
- Loyalty Headline Metrics: 220M active users (up 13%) and $40B in global systemwide loyalty sales
Notice how corporate communications always lead with massive global totals? Combining high-volume international markets shields the U.S. reality: massive app adoption is not driving domestic traffic.
The smoking gun came directly from leadership on today's call:
To fund their new off-app "McValue" offerings, McDonald's pulled back on app-exclusive digital deals (like their Buy One, Add One for $1).
The result? Traffic from their "most loyal" customers fell off a cliff.
CFO Ian Borden noted the move directly hurt traffic from core customers, while CEO Chris Kempczinski admitted that pulling back on digital offers was a "bad trade."
The Key Takeaway: If removing an instant $1 discount causes your "loyal" customers to stay home, you don't have a loyalty problem; you have a price-sensitivity problem.
Consumers aren't opening the McDonald's app to accumulate points for a reward three months from now; they open it for real-time price mitigation.
The points currency will continue to be quietly devalued because spend-based rewards create margin friction during inflationary periods. The app itself remains essential, not for the points program, but as an always-on, data-rich discount delivery engine. The CEO made a nod towards personalization, and I wonder what kind of results they would see if they adopted something like Hang's 1:1 personalization approach.
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