The idea of using American Express points to redeem various rewards is hardly new, but in a joint rollout with McDonalds, the idea is to redeem these rewards in realtime. Stressing that "there are no codes and no registration needed," diners ordering at the counter will be shown a screen that has the option to use points to pay for the purchase.
Amex is slightly sweetening the deal by offering to donate $1 to Ronald McDonald House Charities every time a cardmember uses the service. But just in case this becomes popular, Amex said it would cap the donation at $500,000. (Announcing a low cap is such a delightful touch, sharing that "Helping sick children is nice, but let's not go overboard" message with all for the upcoming holiday season.")
“Card Members love using Membership Rewards points in everyday, relevant ways, and we’re leveraging our technology to make it easy and seamless to redeem points in real-time,” said Leslie Berland, executive vice president, Digital Partnerships & Development at American Express. “When Card Members pay with their American Express Cards at McDonald’s, this technology adds flexibility and choice to that payment experience.”
This capability is expected to roll out to all participating McDonald’s U.S. locations by December 2014, the statement said. Initially, though, the deal will be offered in New York and then Chicago, San Francisco and Phoenix, reports The Chicago Tribune.
The program has one point equal to one penny. That means that a $1 cup of coffee would cost 100 points, said Tracy Stockard, senior director for McDonald's U.S. customer engagement and alliances, according to the Tribune story.
McDonalds is toying with various ways to push its points program and mobile. The chain cut a similar deal with Uber this summer and is also one of the early adopters of Apple Pay.
But it's Apple Pay rollout illustrates how awkward such mobile payments systems can be when integrated with restaurant drive-thrus. As we reported last month, McDonalds initially described a bizarre payment mechanism requiring store associates to lift and hold an in-store card-swipe out the window to allow a customer to place their phone near enough for an NFC transaction. Hope it's not raining or snowing too hard.
In the Amex McDonalds points program, the drive-thru is handled normally with swiping the Amex card. The consumer can later use the Amex mobile app or Web site to reimburse themselves for the purchase with points, which not quite as neat and clean—or as realtime--as the counter-ordering system. Indeed, it's more hassle than paying normally.