McDonald’s acquires AI startup for $423 million to help personalise the drive-thru

The next time you’re asked if you want fries with that, it might be a robot asking the question.

In a rare move, fast-food stalwart McDonald’s is foraying into the world of AI and personalisation through an acquisition of Israeli startup Dynamic Yield, in a rumoured $US300 ($423 million) million deal which marks the company’s biggest acquisition in 20 years.

The relatively obscure startup makes its bread through helping brands across a range of different industries personalise the online shopping experience for their customers. This is done through a suite of recommendation, data management, optimisation and targeting software, powered by artificial intelligence.

However, rather than using the tech to recommend customers grab another burger while they’re lining up at the counter, McDonald’s will largely be using Dynamic Yield’s tech to optimise the chain’s drive-thru experience, along with its mobile app and self-serve kiosks.

“Technology is a critical element of our Velocity Growth Plan, enhancing the experience for our customers by providing greater convenience on their terms,” Steve Easterbrook, president and chief executive officer of McDonald’s said in a statement.

“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 personalised experiences for our customers.”

McDonald’s plans to use the tech to help recommend food to customers based on variables such as the time of day, weather, current restaurant traffic and trending menu items. The tech will first roll out to US stores through 2019, and then to international markets after that.

After the acquisition, Dynamic Yield will continue to operate as a standalone company and will retain its current management and global staff.

“When Omri Mendellevich, our CTO, and I started Dynamic Yield seven years ago, the premise of what we were building was based on customer-centric organizations making individualized experiences and personalization a strategic priority,” Dynamic Yield founder and chief executive officer Liad Agmon said in a statement.

“Our acquisition by McDonald’s, one of the most iconic and beloved brands of our time, is truly an endorsement of that vision as they have chosen Dynamic Yield to help power personalization across their 37,000 restaurants in 120+ markets around the world.”

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