Yum Brands (YUM), which owns restaurant chains including KFC, Pizza Hut, and Taco Bell, is acquiring an Israeli startup called Tictuk. With Tictuk’s technology, customers will be able to place orders at Yum-owned restaurants through text messages as well as through Facebook’s (FB) platforms, Messenger and WhatsApp.
Yum Brands has been testing Tictuk’s technology at about 900 restaurant locations in 35 countries and has found that it significantly boosts sales. Tictuk’s system can be used for delivery, pickup, or dine-in orders, and it can turn around an order in as little as 60 seconds.
Retaining Customers Post-Pandemic
During the pandemic, more customers went to fast food restaurants because sit-down restaurants were shuttered. As more people receive COVID-19 vaccines and indoor restaurants begin to reopen, fast food chains are looking for ways to keep demand strong. Many of these strategies are focused on delivery, online ordering, and overall convenience.
Yum Brands earned $17 billion from online sales last year — a 45% jump compared to 2019. Margins on online orders tend to be higher for fast food restaurants because they require less labor than a traditional in-person restaurant transaction.
Other Fast Food Companies’ Strategies
Yum Brands is not alone in its goal of retaining customers by incorporating more technology into its business model. Restaurant Brands International (QSR), which owns Burger King, Tim Hortons and Popeyes Louisiana Kitchen, has started offering online ordering and delivery at almost 10,000 locations across the US and Canada. In 2018 these services were only available at a few hundred of its restaurants.
Though it is difficult to predict exactly how consumer habits will shift as more people receive COVID-19 vaccines, fast food companies hope that by offering tech-powered, convenient experiences, they will be able to keep up the momentum they have built over the past year.
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