Measuring the Impact of McDonald’s Push Into Automation, Personalization
One hundred eighty-nine seconds. That’s how long the average customer sits in the McDonald’s drive-thru before leaving with her food. It’s not a lot of time to take an order, cook a meal, and serve up the kind of personalized customer service that makes customers want to come back for more. For fast food restaurants, like McDonald’s and others, marketing automation is now seen as an industry-savior.
Less than a year after McDonald’s made headlines by rolling out order automation tools via digital kiosks, the company acquired the Tel Aviv-based personalization firm Dynamic Yield. The move, announced in a blog post by Dynamic Yield CEO Liad Agmon, is part of a “digital transformation initiative” for McDonald’s, helping the fast food giant position itself as a brand that’s known for excellent customer service, alongside retail giants like Amazon and Best Buy.
McDonald’s has plans to utilize Dynamic Yield’s technology across its 37,000 restaurants in more than 120 markets. The company already started testing the technology at several U.S. restaurant locations last year. Now, with the acquisition complete, it plans to roll the technology out across the United States in 2019, with international markets following soon after.
With the right personalization and automation technology in place, McDonald’s is said to have plans to learn about customers through their ordering behaviors. More specifically, McDonald’s is planning to use Dynamic Yield’s technology to create a drive-thru menu that can be tailored based on factors like weather, restaurant traffic, and trending menu items. For example, when the temperature tops 100 degrees, milkshakes and ice cream sundaes might move into a prominent spot on the drive-thru menu board. When it starts raining outside, coffee and hot chocolate might take top billing.
These “smart” displays should also be able to recommend add-on items once a customer has started ordering, based on the other items in the order. For example, if a customer orders a hamburger and a Coca-Cola, the menu would recommend a side of French fries. Meanwhile, a customer who orders a salad might see a recommendation for a more health-conscious side dish option.
Restaurants that can predict and suggest a customer’s order, before that customer has even gotten to the point where he’s tasking the brain to select from a menu, will have a huge advantage over competitors in driving convenience sales, says Rasmus Skjoldan, chief marketing officer at Magnolia, an open-source content management system that works with a number of major brands.
For a business as obsessed with convenience and speed as McDonald’s, Skjoldan says the acquisition of Dynamic Yield makes perfect sense. By being able to know customers, and having the ability to suggest orders based on past purchases, preferences, and context, McDonald’s is able to remove the barriers to conversion.
“McDonald’s acquisition of Dynamic Yield is a strong example of how digitally transforming enterprises are realizing they need to be technology companies that produce and integrate software to run their business,” Skjoldan says.
McDonald’s acquisition of Dynamic Yield has gotten people talking, but the fast food giant isn’t the only major brand using personalization and automation tools to create more custom experiences. At Magnolia, Skjoldan says he is seeing a clear trend in personalization towards allowing artificial intelligence to pair audiences and experiences.
“AI is beginning to show strong results when it comes to understanding what sort of customer is currently visiting a digital channel, and pairing the right content to match,” he says. “The more restaurants can keep track of past purchases, personal preferences and behavior, such as when a certain customer is most likely to buy, the better it can serve offers to, say your smartwatch. This will also trigger buying impulses or solidify known buying patterns.”
Stephanie Miles is a senior editor at Street Fight.