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Brands big and small have reached a so-called tipping point where the primary relationships with their customers have become digital or moved online. As a result, companies are sitting on troves of consumer data. But this data is hard to leverage, which is why McDonald’s is turning to IBM, a global leader in AI for business and AI-powered customer care, to help turn the iconic chain’s customer data troves into a valuable personalization and customization engine. In 2019, McDonald’s acquired technology company Apprente. The acquisition was part of the fast food chain’s “Accelerating the Arches” strategic growth plan for innovation across digital, delivery, and drive-thru by establishing an ecosystem of relevant customer preference information.
Alongside consumers' growing awareness of the value of data, retailers are providing clear benefits in exchange for shoppers’ participation in surveys, quizzes or product selection funnels and the sharing of sensitive or personal information. Applying these insights to the end-to-end shopper journey, retailers are better equipped to not only deliver more tailored product recommendations on a 1:1 basis, but also meet customers with relevant messaging and offers based on their individual needs and preferences. McDonald’s own development and testing of AOT technology in restaurants has shown substantial benefits to customers and the restaurant crew member experience.
In order to elevate and scale its AI and data-powered approach to optimizing the customer journey across its restaurants, McDonald’s is handing over the reins of McD Tech Labs, which evolved out of Apprente, to IBM, who has agreed to fully acquire the division’s assets and turn the world’s largest restaurant brand’s customer transaction history into a predictive tool to drive personalized recommendations, promotions, and more. The agreement will accelerate McDonald’s efforts to provide the most convenient and unique customer and employee experience possible.
It is a win-win for the two global leaders, as well as their customers. IBM’s expertise in building customer care solutions with AI and natural language processing will help McDonald’s scale and implement automated order taking technology across markets and expand into new areas such as including additional languages, dialects and menu variations. For IBM, the acquisition of McD Tech Labs will give IBM Watson a valuable pool of data to learn from and continue running models and tests against as IBM continues its existing work to develop and deliver AI-driven business solutions for clients across industries from financial services and healthcare to telecommunications and retail.
The approach takes in historical transaction data, along with catalog and menu items and marketing campaign KPIs, and analyzes the collected dataset using machine learning to break apart each customer’s personal history and compare it to similar customers in order to then predict future behavior. Within select drive-thru lanes across Chicago, McDonald’s is testing dynamic menu boards that recognize customer license plate to serve up favorites and recommendations based on past orders.
This article originally appeared in the PSFK iQ report, Consumer Data Integration.