PLAYING WITH THEIR FOOD CD-BASED GAMES KEEP KIDS COMING TO MCDONALD'S RESTAURANTS

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McDonald's is betting that kids want to interact with more than burgers and fries in its stores.

More than 100 McDonald's Corp. restaurants-as well as a handful of Burger King, Hardee's and Arby's units-feature Compact Disc-Interactive game players allowing children to color in pictures or answer trivia questions.

The games, designed by Philips Interactive Media, Los Angeles, include children's titles based on "Sesame Street," the Berenstain Bears and Richard Scarry books. Games testing cooking, sports and cultural knowledge are designed to encourage older children and adults to play along with younger children.

For McDonald's, the CD-I machines are an interactive extension of the Playland playground concept and another way to keep families in the store longer. Although none of the games feature McDonald's characters or its name, the fast-food chain is banking on the goodwill achieved from offering videogames that are not violent, but educational. And free.

The push toward interactivity at McDonald's has been led largely by Senior VP-Marketing David Green, a fan of new technology. Mr. Green this fall launched McDonald's tie-in with NBC Online, an area on America Online that promotes NBC programs.

"My dream is to someday see customers coming into McDonald's for interactivity," Mr. Green said in an interview earlier this summer.

That could extend to in-store kiosks with order-taking capabilities, or more simply, offering the chance to play a few games while enjoying a meal.

"Initially, just franchisees were looking at the machines," said Robert Kopecky, president of Apple Tree, a Southfield, Mich., consultancy helping the fast-food operators design cabinetry for the CD-I equipment. "Now the machines are in about 10 corporate-owned stores."

Apple Tree recently shipped CD-I players to McDonald's units in South Africa and Kuwait. And a McDonald's regional office in Hartford, Conn., has five CD-I players on display for franchisees to view.

"Originally, the franchisee community was nervous, thinking these were violent games," Mr. Kopecky said. "But they're educational."

A McDonald's unit in Madison, Wis., is known throughout the system for its indoor Playland, complete with five CD-I players. The Playland has boosted customer traffic considerably since its installation two years ago.

"Our owner-operator liked the idea of letting kids use their minds and bodies at the same time," said store manager Gregg Henderson.

The Playland has lengthened each family's stay at the restaurant, often prompting lingering customers to buy dessert, Mr. Henderson said. Franchisees from all over the country have come to the store to look at the play center.

Mr. Henderson said McDonald's will build another 300 to 500 indoor playgrounds, many containing CD-I players, over the next three to five years.

The success of such centers is one of the reasons McDonald's opted to sell Leaps & Bounds-the indoor playground developer-to competitor Discovery Zone.

"There was supposed to be a Leaps & Bounds coming to Madison-that could ruin us," Mr. Henderson said. "McDonald's didn't want to compete with its own restaurants."

A franchisee in Tulsa, Okla., has made the educational games even more attractive to children by installing several CD-I players in a giant yellow "submarine."

Bob Wagner, owner of the Tulsa store, said that although kids enjoy the games, he hasn't noticed a tangible increase in sales since installing the submarine in April 1993.

"We just wanted something interactive, something clever for the kids to play with," Mr. Wagner said.

With 60% of its business now sold through the drive-through window, McDonald's is finding more room in its dining area for CD-I players, particularly if the machines help bring in traffic.

"If we keep seeing the same percent increase in our sales, we aren't afraid to add more CD-I's," Mr. Henderson said.

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