McDonald’s Buys AI Startup to Customize Drive-Thru Experience

Published on: 27 Mar, 2019

McDonald’s Corporation (NYSE: MCD) announced on Thursday its largest acquisition in 20 years. The Company will buy Israeli artificial intelligence startup, Dynamic Yield Ltd in an effort to personalize customers’ drive-thru window experience. The size of the deal is reported to be over USD 300 Million, according to The Wall Street Journal.

McDonald’s will use Dynamic Yield’s decision technology to vary its outdoor digital menus based on factors like weather and current restaurant traffic. The decision technology can also instantly suggest and display additional menu items to a customer’s order based on their current selections.

“With this acquisition, we’re expanding both our ability to increase the role technology and data will play in our future and the speed with which we’ll be able to implement our vision of creating more personalized experiences for our customers” said Steve Easterbrook, McDonald’s President and Chief Executive Officer.  

The Company began testing Dynamic Yield’s technology in United States restaurants in 2018 and plans to fully integrate the platform inside the U.S. before expanding internationally. McDonald’s also plans to incorporate the technology in its self-order kiosk and mobile app.

The acquisition marks the latest step in McDonald’s “Velocity Growth Plan”, which it announced in 2017. The strategy aims to retain customers through digital and delivery services.

Dynamic Yield uses streams of customer data to help retailors provide personalized digital promotions. According to the Company’s website, its customers include IKEA, Forever 21, and Fendi. McDonald’s will become sole owner of Dynamic Yield upon closing of the deal.

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Nelson Cheng

Email: nelson@financialinsiders.com

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