McDonald's Corporation (MCD) Earnings Call Transcript & Summary

Thanks, operator. Good morning, everybody, and to Chris and Ian, good afternoon in London. Thanks again, everybody, for joining us for the Evercore ISI's Consumer and Retail Conference. From McDonald's, we're honored to have Chris Kempczinski, President and CEO; and Ian Borden, President of International. Chris has been a key architect of the McDonald's Accelerating the Arches growth strategy, going back to his days as Strategy Chief and U.S. President. I found Chris to be one of the best thinkers in the consumer space. So it's been interesting to see his strategic priorities rolled out and implemented over the last 7.5 years or so. Interestingly, Chris worked at some of the biggest and best CPG companies before this gig, and he was at P&G, PepsiCo and Kraft. Ian also has a big job at McDonald's overseeing all international markets now. He has 25 years of experience, having run functions globally throughout the world, including APMEA, that's Asia Pacific, Middle East and Africa, and Eastern Europe. He right now oversees what we call the IOM, which is international operating markets and the license markets as well. So welcome again, guys.

Great to be here.

Thank you.

I'll start off with a question about some of the priorities of the day. It feels like McDonald's competitive position is as strong as I can remember it. And so there was sort of a period, I think, of some heavy lifting, particularly in the U.S. under your watch, Chris. Could you start off by telling us about the evolution of the strategy, what's water under the bridge at this point and what's going right, what opportunities remain and what are the priorities of the day?

Sure, and thanks for having us here. Well, our strategy Accelerating the Arches came from a few different insights that we had. Before we had Accelerating the Arches, some of the observers of McDonald's may remember we had a plan called the Velocity Growth Plan. And Velocity Growth Plan was focused on winning back the customers that we had lost to, frankly, our closing competitors. And we had diagnosed through that work that about 70% of our share losses had gone to our closing competitors. And a lot of that focus was then about just getting the foundations right, fixing the business. We needed to modernize the estate in the U.S., which has gotten very tired-looking. We needed to do some things around product quality, which we did around the world. And that gave us some great success. And then we entered into COVID, and I would tell you that when I first came into this job, my thinking was very much just continue with the Velocity Growth Plan. But COVID, for us, as it did for everybody else, gave us just a moment to step back and say, all right, does this new world that we're living in and will emerge from, does that still make sense? Does the strategy still makes sense? And so we did do an evolution off of that, which is the one that we're executing against now, Accelerating the Arches. And it has underneath it, we used the little mnemonic device, MCD, our ticker symbol, but also a way to organize our thinking to focus against M being marketing and maximizing our marketing, C being our core menu and D being the 3Ds, digital, drive-thru and delivery. And the insight that we had is we had one of the world's best brands, but frankly, we hadn't been doing our part to keep it there. And we needed to step up our marketing and find better ways to connect with culture, find better ways to make it more relevant to a younger consumer. So that's been one part of the strategy. Second is our core menu, it represents 70%, 80% of our business and I think, frankly, we had gotten a little distracted chasing line item, line extensions and other things, the regrounding and our core menu was another component of it. And then the 3Ds we saw a big opportunity in digital and drive-thru and delivery, all of which were happening as takeaway channels and positioning ourselves to make sure that we could win share in those places. So that's what we've been doing, and it's been working great. We just have been here in London with our markets the last few days and really good alignment against that from all of our major markets.

We'll dig into some of those topics here in a second. One thing that is a hot topic, Ian, and that is the Ukraine invasion and not just the human tragedy that that's created and obviously impacted McDonald's, I think people are wondering what's next, not just in that market, particularly, but what impact is that having on your business broadly?

Yes. I think, look, it's been, as you know well, a very difficult set of circumstances that we've had to work through. And we were talking about it just before we got on the call here. I mean we've been in Russia for 32 years. We had a very successful business and brand. Obviously, we had, I think, a strong set of employees, franchisees and suppliers that we built up over that time into really a world-class organization. And for me, personally, it's been difficult because I spent 10 years working in Russia and 6 years in Ukraine at different points in my career. So you've got those personal connections and knowledge of the marketplace. But I think we've really been guided by trying to make sure that we stay focused on looking after our people. That's been at the heart, I think, of certainly how we've thought through every step of our process. You remember back early March, we paused our operations in Russia. And at that time, we announced we were going to continue to pay our 60,000 employees in Russia their full salaries. Obviously, we understood at the time that, that wasn't going to be a sustainable position for a long period of time. And so I think as we worked up to our decision, we were really guided by 5 principles that we put in place early. And could we answer yes or no to each of those principles, and that was ultimately what led us to our decision a couple of weeks ago, as you know, that we were going to exit the marketplace entirely and debrand our operations there as part of that. And those 5 principles, which I think are really important to guide us to the right outcome in this set of difficult circumstance were really around, could we continue to operate our business freely in the way that we want to do that as McDonald's. Second one was really around can we look after our customers and our people the way that we do at McDonald's and the way that we want to be known for. The third one was really around every time we go into a market, we want that to be a brand-building and brand-accretive exercise to our global business. And so with us continuing to operate in Russia going to be accretive to the global brand or not. And we felt, obviously, that, that wasn't going to be the case. Obviously, the fourth one was financial. Is the business going to continue to be financially viable. Obviously, the Russian economy is going through a lot of shocks just because of all of the sanctions and measures that have been put in place as a reaction to the war in the Ukraine. And so we didn't see that getting better anytime soon. So I think that was an important factor. And then, of course, the last one, but obviously, a really important one, which is our values as a business. And I think as we went through those 5 principles, the answer to each of those was no, and I think that was what guided our decision. So I think you might say, well, gee, what does that mean? Obviously, you we're starting to grow faster in Russia. What I would say is I think we've got a tremendous opportunity, as Chris was talking about in his opening remarks, just around how strong our business is across a lot of our markets, and I think we're going to be able to kind of fill that gap by the growth opportunity we've got there and really going after that with a lot more purpose and intent.

And David, if I could jump in just for a second. Unfortunately, I'm battling a little food poisoning here right from lunch. So I'm going to step off and leave it to Ian to handle the rest of it. Sorry for that. But there is lunch here that did not agree with me. So in any event, I wish you guys the best. And I promise I will join you again for another conference.

Well, get better. Right. Absolutely. We got it from here.

All right. Thank you.

Well, why don't we keep on going down the line on the IOM and Europe, in particular. Heading into this year, candidly, Ian, I was very excited about the IOM profit recovery potential. And the leaders, the -- these were the so-called leadership markets. And for you to have the drive-thrus to survive a tough time and there was even less inflation in those markets. So did you think about the on-premise recovery coming back, which was very much more on-premise-y than the U.S. business? It's exciting to think about the leverage since many of those are company-operated restaurants. So to some degree, I feel like some of these things coming out of Russia and the inflation and perhaps consumer sentiment itself is a little bit of an offset, so -- off of what was going to be an incredibly bullish situation. Could you speak to that? Could you talk about the state of the consumer in Europe, in particular, and walk us around the IOM?

Yes. Thanks, David. Well, look, I might just set a bit of context, I think it's really important, knowing how disruptive the last couple of years have been. But if you go back to kind of 2019, which I think is really important for that segment, as you called out, I mean, our IOM group of markets, and as you know, most of those markets are centered in Europe, right? So you have a couple of exceptions, Australia, Canada to that. But the bulk of those markets are in Europe. And we were, I would say, in a really, really strong place. So we had several years of very, very strong momentum consistently across that group of markets. We had a very modern estate because we've been working with our franchisees, I think, very proactively to kind of continue to invest, to grow the business. I think we had strong marketing and menu and fairly consistent across that group of markets. And then you had this very, very high level of alignment, trust and engagement with our owner operators, which, as you know well, is so important in how we bring everything to life. And so I would say we had a very, very strong and aligned set of plans. And so as we went into COVID, that group of markets, I think, was one of the strongest groups within our organization in terms of that underlying momentum and all the work that had kind of been continuously going to drive the business. But then you got into COVID, as you know, and across Europe, you had a lot of markets that went through that period kind of in different stages and different sets of restrictions and different timing of outcomes. And so it's really honestly even been into the beginning of this year that we've still been seeing, I would call it, the reopening of some of those markets, the Frances and the Germanys, for example, that were later out in terms of easing restrictions. And so we still got a fair bit of recovery going on, I would say, in the first part of this year. But if you look back to what we talked about in quarter 1 from a result standpoint and you look at that group of markets, I mean, we had comps in quarter 1 of 20%. And then even if you kind of step back and think, well, gee, what does that mean with all the ins and outs that we're trying to deal with through this period of a lot of disruption? So you kind of go back to 2019 and you look and -- all of those markets now are no longer in recovery mode. We're actually growing on 2019, and we're seeing pretty strong and consistent growth. So what has been encouraging to me is I would say that momentum that we brought into COVID, we're seeing that continuing to help us accelerate out of COVID. Then we get into, of course, what you were talking about in your question, which is, well, what's the landscape now? And obviously, most of our markets around the world are certainly facing a higher period of inflation, obviously, driven by those key factors that you're well aware of. But that kind of supply/demand imbalance through COVID, now of course with the war in Ukraine and the knowing that Ukraine and Russia are kind of key output markets for things like food commodities and some of the inputs to the manufacturing goods. I think that level of inflation is certainly higher across Europe than other parts of the world. And so I think the impact on the consumer sentiment and nervousness of the consumer when you look at inflation and then you also look at the proximity of the war, which is obviously much more present, I think, to a European consumer, I think those are certainly some headwinds from a consumer standpoint. And I think to be honest, I think you've got this complexity of factors that we're dealing with when we try and understand what -- how are all of those different individual elements impacting the kind of momentum of the business? Because you've got the recovery that I talked about and still easing of restrictions or comparability to periods where there were restrictions. You've got what I would call the pent-up demand and spending desire of people that we're saving more during COVID that's kind of being released into those purchase and as people get back to more regular habits. And then, of course, you've got these headwinds that we're really starting to, I think, see more substantially. And I think it's hard to dissect yet just what does each of those elements look like. What I would say is I think we are not seeing any substantial signs of reduced momentum across that group of markets, and I feel like we're in a really, really strong position. I think when you get to pricing, of course, right, because obviously, with higher inflation it means we're looking at higher levels of pricing as we go in to try and offset the inflation and the impact on the business, I mean, I think there are a couple of things that we're really what I would call laser-focused on. I mean, obviously, value and affordability, which, as you know, is something we're known for, and I think something in a period of uncertainty that's even more important for our customers. I think we've got a very, very strong focus on making sure that our good value for money scores continue to be strong, particularly in regards to the landscape around us. I think we are certainly, generally, we have the approach that we want to do more frequent increases but at smaller levels. So we try and, I think, generally make sure that we don't get into doing substantive increases. And of course, as you know, at the end of the day, it's our franchisees that decide the prices that they're going to take in their individual restaurants, and we use outside advisers, obviously, to help come up with recommendations on what those price increases would look like. I think the other thing that I -- that gives me certainly a level of confidence is we've done a lot of work over the last couple of years to really, what I would call, improve the capability of our third-party advisers just to make sure that we're really using strong data, strong customer insights, strong analytics so that we're putting the best possible recommendations forward. And as we do those, let's call it, smaller increases more frequently that we will have the time between each of those adjustments to ensure that we can understand, did consumers behave the way that we expected them to or not to make sure that we're building that intelligence into the next set of increases. So I think that's kind of a long-winded answer. But what I would say is, I think we came in to COVID in a position of strength. I think we are coming out of COVID in a position of strength. I think we're being very prudent that the landscape certainly has some headwinds in it. And I think we're being very conscious to ensure that we kind of stay on the side of the consumer as we make decisions through this to ensure those really important fundamentals of our business around value and affordability stay as strong as they can.

First of all, you now see on camera, Mike Cieplak, who'll pitch in here as needed, VP, Investor Relations. But when I hear some of the things you're saying there, Ian, I'm thinking about the relationship of price to your own inflation. And I'm thinking about your pricing versus the -- what you call the informal eating-out market, just that overall price -- pricing being taken around you. Could you walk us through where you're keeping up with inflation, where you're not keeping up with inflation? And also, where do you see already maybe some -- a little bit higher levels of price elasticity, if at all?

Yes. That's a great question. Well, look, I think there are a few things that are really important. One is we certainly are always as -- so one of the data inputs is we're always monitoring the environment around us. And I think there are a few ways we look at that. Certainly, we look at our competitors and what our competitor is doing in terms of pricing. We look away -- as you said, we look at overall inflation, but we also look at food-away-from-home inflation and then food at home. And I think what's a little bit unique about this set of circumstances that we're in is actually food-at-home inflation right now in a number of markets is actually growing faster than food-away-from-home inflation. And so when normally some consumers may switch out from going out to eating at home, I think we may see some different behaviors just because of the different paces on -- across some of the commodities or some of the basket of goods that people would purchase. I think as we get through this, what we're really trying to make sure that we do is make customer-facing fact-based decisions because we know that the most disruptive thing we can do to our business is disrupted by the momentum that we have. So if I go back to what I was talking about earlier, how strong, I believe our underlying momentum is, if we disrupt that by getting ahead of a significant number of our consumers, that is obviously going to be an issue because then we get away from that value and affordability. And so I think our pricing recommendations that we make that are made through our third-party advisers are really based by very, very detailed analytics that are really looking about if you do this price -- how do we think consumers are going to react if you do this price. And so it's -- there's very, very, what I would call, good analytics around the level of pricing, how we think the customer is going to react, and we're very conscious of getting the right balance between inflation recovery and not losing a substantial amount of traffic -- customer traffic as part of that. And so I think when you get into these periods of higher or more rapidly increasing inflation, you may have delays between the level of inflation and the level of pricing, but obviously, that is recovered over time. And at the end of the day, what's most important to our business is to drive traffic. And so we have to get that balance between the short-term recovery, the level of traffic and then I think the long-term goal of, obviously, we're going to get back to the margins and the objectives that we've got as a business.

And, Dave, just to add on, complement to what Ian said. So we do use this -- we do -- we use a third party for the consulting part of the pricing recommendations. And there's a lot of data analytics that goes into that. Now years ago, we would have been talking probably a little bit more food-away-from-home, food-at-home. But over the years, we've increased our capabilities, like Ian said, so we had a little bit more consumer-based approach going in to inform the decisions. And then we continue to monitor where we are against food-away-from-home and food-at-home. Just as a point of reference, we also look at -- we do a lot of consumer survey in this space and sort of like a value for money scores is something that we look at to understand if the consumer is also telling us from the survey standpoint, if we're pricing competitively. And then the third point I'd say is just from a -- we look at competitors, and we do this at a -- it's not -- like in the U.S., for example, it will be more -- not necessarily national, more geographic or local based to see what the competitors are doing. And across all 3 of those, the analytics, the consumer research and the competitor set, we feel like we're in a pretty good position to be able to, like Ian said earlier, be able to take some smaller but more frequent and more frequent as in few times a year, not like weekly, monthly, anything to that extent because it takes us probably 6 to 8 weeks to get a good read on how a pricing round goes before we can decide what we might do next. But that's just generally how we're approaching it and why the food-away-from-home and food-at-home are still a good guidepost to be looking at and thinking at, but aren't necessarily like driving decisions as much as they probably once were years ago.

I mean just to put some -- perhaps some examples or numbers around things, what sort of inflation are you dealing with, right, in this year in your key markets, maybe the big 5 in the IOM? And are you pricing below that type of inflation because you don't want to go tempt a price shock to the consumer? Any sort of dimensionalizing of that and maybe even talk about what markets you might be particularly dealing with more inflation relative to your own pricing versus others?

Mike, I might let you jump in, in a sec, but I mean, I think it varies a fair bit is the answer, David. So it's -- as I said, I would -- I won't get into market by market, but I would say in Europe, certainly, inflation is more concentrated. And I think we're seeing higher levels of inflation across certain markets in Europe. And again, I think the level that we recover is, again, it is very specific to the set of circumstances in each individual market, right? The competitive pressure, the consumer sentiment, the pace of inflation, the strength of, I think, our business and where we feel we've got opportunity. So I think, as Mike was kind of alluding to earlier, it's really consumer-based, fact-based decision-making, obviously, ultimately decided by our franchisees through the advice that we provide through these third parties. But what I think is important is if you go back to the comments that I made around momentum. I mean with our momentum, I think we are in a strong position to be able to recover inflation at the right pace and make those decisions without getting ahead of the consumer.

Ian, maybe you'd share some of the dynamics from a consumer standpoint, energy, costs, things like that, that are a little bit different maybe in Europe than we're seeing in the U.S.

Yes, I think -- well, I think the pressure point in Europe that's a little bit more specific, and maybe just because we're in the U.K. today, that's a bit of an example, but you just -- because of the dependency on energy from Russia and obviously, then the escalation of prices because of the supply-demand imbalance once you take some of that supply out of the equation. I mean I think the markets in Europe are certainly seeing that more significantly. And so you've got markets in Europe that are certainly what I would call in the mid-teen area levels of inflation. The U.K., as an example, energy prices for consumers have gone up because they've had a 10-year cap in place by 40% or 50% recently. So I mean those are I think some of the -- I think the acuteness of the impacts that we're seeing is they are very broad in terms of they're impacting everyday consumers, and they're not necessarily discretionary items that consumers can trade away from. And I think that's a little bit of the uniqueness of the headwinds that we're dealing with now and something that's certainly we're very, very conscious of as we're kind of navigating through these factors.

You're clearly in a great position to comment on the strength of the consumer in general, pricing or otherwise. Where are you seeing relative strength, relative weakness as you think around your markets?

One of the beauties of my job, David, I guess, is I look across 115 of our 119 markets. So it gives me a pretty good viewpoint just how are we doing around the world. And what I'm pleased with is -- again, if you go back to quarter 1 and you look at -- we talked about the IOM comp of 20%, if you look at IDL, which is 80-plus markets. In all geographies around the world, they were up 15% on a comp basis in quarter 1. And what I would say is that performance is very, very consistent across all of the geographies and all parts of our business, whether it's developed or developing markets across the system. So I think it goes back a little bit to what Chris touched on earlier, which is the beauty of our Accelerating the Arches plan and the fact that we were able to adapt it during COVID is its -- they are priorities and strategies that are resonating across every market in our business, and they are priorities that are resonating with consumers across every marketplace. And so I think the strength of our performance is very consistent. I think there are always, of course, a couple of outliers. China would be probably the largest market that's an outlier to that. As you know well I'm sure from past comments, China is a market where we still are not back to 2019 average restaurant volumes. But as you also know, the Chinese government has taken that approach of a zero tolerance policy to COVID. And so therefore, we're still in this period of restriction. And so therefore, it's not a -- let's call it, it's not a strategy or a priority issue. It's an external environment issue that, obviously, the whole sector is dealing with. But that would be, I think, the only significant exception I think to the strength and consistency of our performance.

I wanted to circle back, really change topics to the whole notion of digital loyalty, sort of that nexus of how you're trying to get more of a direct relationship with the consumer and increase your competitive convenience moats. I mean last quarter, your digital sales, which included mobile app, kiosk and delivery made up more than 30% of sales around the world. I think the rewards program is in over 40 markets around the world. So could you perhaps talk about the digital journey so far? Ian, I think we're particularly ignorant about how that is working overseas. So it will be interesting to hear your perspective.

Yes. I think, it goes back to Accelerating the Arches, the MCD framework. And then digital, as Chris called out in his opening, being one of those 3Ds under the 3D topic. I mean, obviously, it's an area we are very optimistic about the opportunity. I mean we certainly see -- I think if you go back to some of the decisions we made as we put that Accelerating the Arches strategy in place, one of them was to be a lot more focused and purposeful about getting these key capabilities and loyalty, David, as you highlighted, or as we call it MyMcDonald's Rewards, was one of those key capabilities that we wanted to make sure that we got across our 6 top markets. And so that is something -- in July this year when the U.K. launches their loyalty program, we will have put that in place over the last 18 months across our 6 most important or obviously, largest markets in our system. And I think that's a really important point because it's just about the discipline that we've had knowing how important we think loyalty will be to us to make sure we are getting that into the key markets. And then -- and as you've said, we've also got another version of loyalty or a very similar version in our midsize and small markets, about another 35 of those. So if you think about the -- what is, I think, so important about Accelerating the Arches is when you have that common plan and common set of priorities and you start getting scale to those priorities, then you can have the power of, or at least what I think of as the power of our McDonald's system in that you get this continuous learning and innovation and sharing of best practices across our markets, and I think that's what we're starting to see. And then if you get -- I think if you look at loyalty on its own, I certainly think -- we think of that as a multiyear business driver. If you think -- as you know well, we serve 60 million customers around the world every day in our business. As we get more and more of those customers on to loyalty, we get to know those customers on a personal level and we can start anticipating their needs, the opportunities they have, more smartly suggest to them what they might be interested to buy, better market to them because we're more attuned to what their preferences are or their purchase preferences are. I think you just really start to amplify the opportunity and you allow us, which is a struggle now when you don't know your customer to get a lot more personal and bring a lot more value into the relationship with our customer. And that's what gets me really excited about the digital opportunity from a customer lens. But I think the other part of digital is as you get that better data and better understanding of the customer, you're then able to also take it to the back part, or let's call it, the production part of our business and just use that data so that we can better organize our capabilities. And I would call it start removing more of the friction in the customer experience, which is a big opportunity, as I'm sure you've heard Chris talk about previously. So I think we just -- we feel very, very confident that we've got this kind of multiyear growth opportunity now that we're really starting to get digital at scale in our organization. And I think we're certainly encouraged by some of the markets that, like China that are further along in the journey and what they've been able to bring to life in a very, very digital-centric environment in China.

One of the things that I'm fascinated by is your ability to, in the future, somehow find a way to get to know who is buying your stuff. And then all of the upstream benefits to marketing. What we see across consumer, many companies have cut back on advertising. You guys have continued to spend as a percentage of sales alongside your franchisees, and to think that you might get efficiency on top of that relative weighting from a marketing perspective is exciting. That -- I think they said less than 10% of the customer orders, they know who the customer is. I think that was the U.S. number, Mike, correct me if I'm wrong?

Yes. Yes, that's right.

Is that a similar situation overseas? Or do you feel like that, that is different. But more importantly, what do you think is going to cause a step change in that and when?

Yes. Well, I think the level varies by market. Just if you go back to when capabilities went in different markets, some markets have been at it longer than others. I think we're going to see a step change from a couple of things. First of all, as we bring these capabilities to life at scale, and we're really showing the customer the convenience and value benefits of interacting with us in that way. So you just think about loyalty. We're heading into this period of uncertainty where there's more pressure on consumers, the value of a loyalty program and the ability to redeem points for your McDonald's favorites, I think, just becomes naturally something that's more appealing to consumers. The fact that we can start to more smartly target the offers to making -- to consumers, David, as you were talking about. I think the big one, which you know we're working on very purposely now is just how do we get rid of some of these pain points? So how do we make the digital experience even more seamless than it is today. I think we still got a lot of friction in the experience, which is why we put this customer -- Chief Customer Officer role and collected all of those customer-facing functions together under 1 organization. And I think there's some really significant opportunities there. Show the customer that the digital experience can be as good or even obviously clearly better than other experiences. And I think that will then drive a pretty strong position to the consumer to want to interact with us in that way. I mean if you think about just the ability to go through the drive-thru and that to be a seamless experience or curbside pickup where you get your order in before you get to the restaurant, it's sent at the right time into the kitchen so the food's prepared at the right time. And then as you park your car, you're greeted by a crew person who has your order ready. If you're a mother with 3 kids in the car, I mean that's just a huge value-add to your experience because you've just taken all that stress, which a lot of our customers are still dealing with and provide a lot more value just through the use of technology and what we know we can do as we get this right and continue to improve. And so I'm really -- I think, really, really excited about some of those opportunities that I know we're going to be bringing to life over the next months and as we go forward.

I know we're at time, but I will just ask one follow-up on that and we'll wrap it up. But when you think about the next 1 to 3 years ahead, whether that's technology being used in certain ways to face the consumer or maybe stuff that can help your labor become more efficient. And obviously, this industry has not been leading the world in terms of labor productivity improvements, what things are you most excited about over the next 1 to 3 years?

I would probably talk about 2 things. One is, just as Chris was saying earlier, we're in London this week. We've just been through the plans for our top 10 international markets looking forward. I'm excited about the energy and alignment that our Accelerating the Arches plan is driving. And just, I think, how we are getting even more aligned and more consistent in the opportunities we're going to work on together. And that may not sound that exciting, but when you think one of our key advantages as a system is our size and scale. And if we're not working on things together to really bring that competitive advantage to life at its maximum potential, then we're not using the resources of our system to their greatest advantage. And I feel really good having been through those plans, just about how much sharper we're even getting around that. And then the second, I'm going to be a bit repetitive, but I just go back to digital. I mean just digital is just such an exciting opportunity, one, as you know, that we've been working at for a long time. I just -- I think we've made a significant amount of progress over the last 18 to 24 months. Obviously, we've got a lot of work to do. But as we were talking about it, you've got all those consumer-facing benefits of the personalization, getting to know the customer better, adding value to the experience, kind of unlocking those stress points that I think are barriers or potential barriers today. Then you've got all the data on the back end where we can just get a lot more efficient and organized and how we operate the kitchens, how we staff. So you're going to get the sales driving opportunity and you're going to get the business efficiency opportunity. And I think as we bring those to life at scale, that's really exciting.

Well, thank you, Ian. Thank you, Mike. I really appreciate your time. All the best also to Chris K, him getting to feel better. Thanks, everybody.

Thanks, Dave.

Thanks, David. Great to be with you.