SXSW: Mashable to McDonalds, Thinking Like a Tech Company

When I interviewed Pete Cashmore on stage at SXSW the obvious question to start off with was whether his company, Mashable, was a media company or a tech company. Of course he said it's both: in addition to creating videos, articles, and native ads, it also sells software to predict what content will go viral. But what Cashmore said next speaks to a trend that came up in a number of conversations I had at SXSW: it's not just media companies that now need to embrace technology, ALL companies need to be tech companies.

Mashable earns all sorts of advantages by behaving like a tech company rather than just a media one. There are the benefits of multiple revenue streams — the Velocity software it sells to ad agencies makes it less reliant on advertising. And the idea that it could sell the technology it creates for its own use, helps weave incentives for innovation into its own DNA. Plus, who knows what the future holds for the private company, but the valuation of tech companies tends to be higher.

It makes sense that Cashmore, who started his digital content startup when he was 19, would be constantly looking for the best way to embrace technology. He's a digital native peddling content to other digital natives and experimenting with the best way to tailor content to different platforms.

But can McDonalds embrace technology — and convince SXSW's audience of hip early adopters that it's baking innovation into its DNA? That's precisely why, for the first time, the fast food chain officially sponsored SXSW. Its presence at the festival is huge. Its logo is everywhere: the golden arches emblazoned across a phone charging station inside the convention center, a giant food truck and tent right across the street from the convention center, with a stage for bands.

Greeting attendees as they walked into the circus-size tent: a life-size sculpture of a Ronald McDonald holding up a smartphone for selfies, next to a sign pitching take the best selfie mentioning @ronaldmcdonald and he'll repost it. (Based on the technicolor flowers and paisely of Ronald's suit, his outfit seemed more likely picked out by my grandmother, who had a particular penchant for loud prints, than one of the hipsters in attendance.)

Selfie-snapping Ronald speaks to the two challenges facing new CEO Steve Easterbook, which McDonalds is tackling at 'South By': innovation and marketing. It has to convince a millennial audience especially that's increasingly drawn to the likes of rival Chipotle. The burrito brand has won over millennials by distinguishing itself as the anti-McDonalds with humanely-sourced meats, all-natural ingredients, and eco-friendly packaging. And even the biggest critic of fast food can't help but love Chipotle's bold, clever 'Getting Back to the Start' commercial criticizing factory farming.

At 'South By' McDonalds looked to demonstrate it's doing more than just looking to upgrade its image — it also wants to change the way it does business. The company hosted three pitch competitions, targeting startups in relevant areas: "Reinventing the Restaurant Experience," "Advancing Content Creation," and "Mobilizing Transportation and Delivery." The prize: a trip to headquarters to pitch a concept to McDonalds senior team.

The winner of one of the competitions was particularly apt for McDonalds presence at SXSW: Hello Sponsor, which helps brands manage and track their event sponsor activity. CEO Greg Kubin told us he's excited to pitch McDonalds C-Suite, and he thinks his company can help it better tap into local communities. "It's an incredible opportunity and it's something where I think we can add a lot of value to the organization," Kubin said.

But does McDonalds sponsorship of SXSW make sense? Kubin says it's "a really good opportunity for them to really engage with cutting edge innovation."

At its lounge at the Hilton near the convention center, McDonalds targeted entrepreneurs with panels on topics totally unrelated to fast food: "Leveraging the Gray Area Between Digital and Physical," "Wire-free and Worry-Free: The time for wireless charging is now," and "How Your Scale and Reach Can Change the World."

So can all of this convince the SXSW audience of trend setters and early adopters that McDonalds is a brand for done-flying coders? The folks I chatted up in line for free smoothies and fries, taking advantage of the free WiFi, werenonplussed . They were more interested in the length of the line, the proximity to the convention center, and the cost — nothing — than whether McDonalds aligned with their brand values.

I heard a low rumble through my couple days in Austin about what an odd fit McDonalds is for a city where artisanal, locally-sourced tacos and barbecue inspires religious fervor. And a couple of people questioned whether it's a sign that the brand presence at SXSW has gone too far — after all the festival screened 'Super Size Me,' a powerful documentary about the poisonous effect of.... too much McDonalds.

Backlash to McDonalds presence at SXSW started before the festival did: the company was shamed by a band it booked to perform because it hadn't planned on paying them. The company apologized and announced it's planning to pay all its performers.

While paying up to sponsor the festival certainly wasn't a game-changer for McDonalds image, perhaps its exposure to new ideas from entrepreneurs will help Easterbrook better execute his makeover plan.