Yum! Brands Leverages Voice AI and Data for Personalized Service

In its Q3 earnings call on Tuesday (Nov. 5), Yum! Brands pointed to the more than 2 million orders through voice AI at its Taco Bell restaurants as an example of how its brands use tech to reach consumers.

Yum! Brands is the parent company of KFC, Pizza Hut, Taco Bell and Habit Burger Grill.

CFO Chris Turner said Taco Bell is implementing voice AI in its drive-thrus and loyalty program enhancements.

“Drive-thru voice AI continues to scale across our network, with many franchisees eager to test this new innovation,” he said.

“To date, we have processed over 2 million successful orders with the system now in place in over 300 Taco Bell U.S. stores, making Taco Bell the largest QSR voice AI brand in the world.

“For loyalty, Taco Bell is using its connected ecosystem to allow loyalty consumers to identify themselves at the drive-thru and kiosk, enabling personalization of their ordering experience and earning and redeeming of loyalty rewards. This was rolled out to 160 stores in Q3, and we’re encouraged with early results, which clearly show an increase in sign-ups and in daily loyalty transactions, all without an impact to speed of service.”

He also outlined the company’s two-phase digital strategy on the earnings call. The first phase focuses on acquiring, building and scaling proprietary platforms to gain control over their data, streamline innovation, and leverage cost efficiencies through scale. The second phase aims to maximize the value of these platforms by using artificial intelligence (AI) and the company’s extensive data assets.

Key components of this strategy include the company’s proprietary Poseidon point-of-sale (POS) system, its Yum Commerce Platform launched in 2021, its 2021 acquisition of ordering technology solutions provider Dragontail, its SuperApp back-of-house management app, and its Global Data Hub.

“We believe we are still only scratching the surface of the full value potential of our digital capabilities,” Turner said.

Leaning into digital will help the brands reach more consumers, who now expect smoother experiences, CEO David Gibbs said, adding, “Our digital capabilities continue to power the business. Our digital capabilities are even a bigger advantage now.”

Digital sales, which rose 30% year over year, grew more than $8 billion, with a digital mix surpassing 50%.

For Gibbs, the AI factory within that ecosystem leverages “our massive data assets through our Poseidon POS in stores, digital menu boards, and through our loyalty program and connections to consumers through the app.”

Turner said leveraging customer data and personalizing through digital offerings like voice AI is vital to the company’s future success. PYMNTS Intelligence research reveals that 83% of consumers want personalized offers, but only 44% are satisfied with the ones they are receiving.

As Yum! Brands continues expanding its digital capabilities and global reach; the company’s third-quarter results highlight a challenging global environment, including geopolitical tensions and shifting consumer sentiment.

The company reported 1% global system sales growth, driven by a 5% increase in unit growth. Taco Bell U.S. outperformed competitors, with 4% same-store sales growth, while KFC International saw a 9% increase in unit growth across 64 countries. Same-store sales at KFC and Pizza Hut fell 4%. Despite these challenges, the company remains optimistic, citing its core business and long-term growth prospects.

“I’m encouraged by the underlying strength of our fundamental business,” Gibbs added. “Despite the numerous headwinds, we’re proud of the resilience of our overall business model. The strengths of our twin growth engines were evident: Taco Bell U.S. significantly outperformed QSR competition with 4% same-store sales growth, and KFC International grew units an impressive 9% year over year.”

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