McDonald’s is mulling to sell part of digital startup Dynamic Yield. The fast-food giant is considering this just two years after it acquired the startup in order to boot sales. The company used its technology to increase sales at digital kiosks and drive-throughs. McDonald’s is evaluating the move as lots of franchises complaint that the technology has failed to deliver on boosting sales as promised. The burger chain conducted a review in which it was found that the contribution of Dynamic Yield’s technology in sales was less than initially reported.
The coronavirus pandemic has brought a change in how people would order their foods. They now prefer to make online orders and other digital options over visiting restaurants and eat inside. This prompted McDonald’s to scrutinize its technology platform. Not only McDonald’s, but other fast-food chains are also adopting the same strategy. They are shifting focus to digital sales through various means like the app and outdoor menu boards. While McDonald’s register an increase in sales in the United States during the pandemic, chain executives believe that the company needs to keep investing in technology. They believe that it is important to satisfy customers who place orders with minimum human interaction.
Dynamic Yield uses streams of customer data and works with retailers to help them offer personalized digital promotions to consumers. It worked as a stand-alone company with McDonald’s and provides personalized offers to customers at its stores. McDonald’s purchased the startup in 2019 by paying more than USD 300 million. It was then the largest acquisition of the company in decades. Executives termed it as the core part of the digital strategy. However, the company is now considering a part of the Israeli-based technology. The company however clarified that it is considering selling only that portion of the company that is working with other retailers. McDonald’s will keep the part of Dynamic Yield that provides services to it.