Yum! Brands, the parent company of Pizza Hut, KFC, Taco Bell, and The Habit Burger Grill, is looking to increase its digital sales to comprise 100% of its sales, according to its CFO, Christopher L. Turner. The company currently derives 40% of its sales from digital channels and has acquired two technology companies, Dragontail Systems, and Kvantum, to help it expand its capabilities in this area.
Dragontail focuses on optimizing and managing the food preparation process, while Kvantum uses algorithms and AI to help brands understand consumer behavior and make better marketing decisions. Yum! is also using TikTok's e-commerce capabilities to help drive its digital sales. With this multichannel approach to digital expansion, it is expected that Yum! Brands will be able to quickly grow online sales for many of its more popular brands. For example, PIzza Hut already sells the majority of its transactions through digital sales, with 60% coming from applications and websites. Additionally, the company notes that digital sales see a larger increase in return on ad spend than brick-and-mortar sales.
Digital Fast-Food Restaurants
YUM! Brands is Expanding its Technologies for Digital Sales
Trend Themes
1. Multichannel Digital Sales - YUM! Brands is expanding its digital capabilities across various platforms, including TikTok, to increase online sales for its popular brands, offering an opportunity for businesses to implement a multichannel digital sales strategy.
2. Optimized Food Preparation - YUM! Brands' acquisition of Dragontail Systems, which focuses on optimizing and managing the food preparation process, presents an opportunity for innovative solutions for quicker and more efficient food preparation in the restaurant industry.
3. AI for Consumer Insights - Kvantum's use of algorithms and AI to analyze consumer behavior for marketing decisions suggests an opportunity for other industries to leverage AI technology for insights into consumer behavior for targeted marketing.
Industry Implications
1. Fast Food Industry - YUM! Brands' aim to make digital sales 100% of its sales offers an opportunity for the fast food industry to embrace digital technologies and optimize the customer experience in this channel.
2. Food Tech Industry - YUM! Brands' acquisition of technology companies Dragontail Systems and Kvantum points to an opportunity for the food tech industry to develop innovative solutions for optimized food preparation and AI-driven consumer insights.
3. Marketing Industry - Kvantum's use of AI for consumer insights highlights an opportunity for the marketing industry to leverage AI for targeted marketing and a more personalized customer experience.