In a surprising move by one of the world's oldest fast food restaurant chains, McDonald's just announced that it has just acquired a startup company for US$300 million. However, the company didn't actually acquire a competitor, as most investors had expected, instead, the firm bought a tech company called Dynamic Yield.
The acquisition is McDonald's biggest acquisition in over two decades and is seen by some analyst as a clear sign of its evolving strategy to keep up with the changing global market. According to the company, the agreement it had reached with Dynamic Yield was a necessary one as it needed to use the firm's technology to improve their customer's dining experience.
Dynamic Yield specializes in what the industry calls "decision logic" technology, which is a form of artificial intelligence-based machine learning software that identifies customer preference based on historical data. Through the data that is gathered using the Israeli startup's software, McDonald's could soon be able to give customers recommendations based on their past behavior and purchases.
McDonald's revealed that it was going to use its newly acquired capabilities to boosts its digital drive-thru systems. The technology should allow their drive-thru screens to display different food items based on specific factors such as weather, trends, and even the time of day.
As an example, drive-thru screens and other media within the restaurants could suggest cold drinks if it's a particularly hot day. Additionally, the technology could gather data on the preparation times for each food item and then suggest them accordingly depending on the number of people on the order and drive-thru lines. The selections would allow for customer-specific suggestions that would hopefully increase overall sales. Predictive analytics could also be used to further increase efficiency in the company's kitchens and its supply chain.
Unlike other fast food outlets, McDonald's has always been at the forefront of integrating new technologies into its business practices. Just recently, the company had upgraded a number of its global stores to sport self-serve kiosks, negating the need for additional employees. The company also launched its own mobile app, which immediately became popular with younger consumers. The company also partnered with Uber Eats, which significantly increased its delivery-based sales.
The recent acquisition of Dynamic Yield could potentially be a game changer for the company. The move could also cement the company's reputation as a tech innovator in the food industry. Given the firm's customer base, estimated to be around 68 million customers a day, McDonald's can fully take advantage of the data gathered from those customers with their newly acquired technology.
