Domopalooza 2021 – the analytics takeaway from Yum! Brands, the fast food firm that's also a digital company
Domopalooza 2021 – the analytics takeaway from Yum! Brands, the fast food firm that’s also a digital company
Tue, 03/30/2021 – 02:50
- Yum! Brands owns some of the world’s most famous fast food businesses; it also owns “one of everything” from a tech perspective, with analytics high on the menu.
How can you get 50,000 Taco Bells, Pizza Huts, KFCs, and Have-A-Burger to do curbside pickup?
There have been many challenges placed on a host of business sectors during the COVID crisis, but this one, articulated by Domo CEO Josh James, is one that has been common to the QSR (Quick Service Restaurant – a.k.a fast food) industry over the past year.
James was speaking as part of the analytics firms Domopalooza annual conference where he cited Yum! Brands, owner of the likes of KFC, Pizza Hut and Taco Bell. A global company that serves millions of consumers at 50,000 restaurants across more than 150 countries and territories, Yum! has had ‘a good war’ when it comes to the pandemic, with appetite for takeaway products not inhibited by locked down consumers with time their hands and access to their own kitchens.
The group exited 2020 with digital sales up 45% year-on-year to $17 billion, $5 billion of which came in the final quarter, but the signs of an online uptick were there to be seen early on in the crisis. Back in May last year, David Gibbs, CEO of Yum! Brands, predicted:
I really do think that the few months that we are in the middle of right now are accelerating a lot of trends in the business that would have taken years to take hold, like digital order-and-pay and delivery and technology and all the stuff that everybody is talking about.
Those words have certainly been put into practice as the group has continued to expand its digital footprint in order to drive fresh innovation. Last week it announced the acquisition of chat-based ordering and marketing platform company Tictuk, which brings ‘conversational commerce’ capabilities to allow consumers to place orders through messaging platforms including SMS, WhatsApp, Facebook Messenger and Telegram. It’s a feature that’s pitched by Clay Johnson, Yum! Brands’ Chief Digital and Technology Officer, as “an incredibly effective omni-channel ordering system… allowing us to offer more frictionless ordering experiences for our customers.”
That addition to the digital arsenal comes not long after the acquisition of Artificial Intelligence (AI) analytics company Kvantum, which allows for the creation of complex models of consumer behavior to provide marketing insights. And of course, Yum! Is also a long-time user of Domo’s own bleeding-edge analytics offerings.
In fact, it’s possible that you can never have enough analytics oomph behind you. According to Cameron Davies, Chief Data Officer at Yum! Brands:
We believe it’s our responsibility to enable our employees with the tools that will drive their data agility and literacy, and promote intelligent action to further our business goals.
It all starts with notions of availability, he argues:
If you think about standard retailers, it’s [about] shelf space; for us it’s how do we make it easy for you [as a consumer] to get [our food]? How do we make it easy for you to consume it? This is when we when we think about all the solutions that are available to us and the choices we could make.
Getting people to tap into the tools at their disposal is, of course, crucial, he says, and that means providing tech that’s clearly going to assist them to meet their operational and business objectives:
Like everybody else, we’ve got one of everything. When you look at speed-to-market and when you look at how quickly I can put something in somebody’s hands, that’s what’s going to get ownership – something that’s fast, something that’s easy, that has both pull and push to it. Those are the things that driving adoption more than anything else. I don’t have to make anybody do anything if it’s easy for them to do it.
As noted, the challenge for QSR firms over the past year has been immense, but so too is the opportunity to exploit analytics tech across the sector as a whole anyway, argues Davies:
I spent so much of my career in big companies like Disney that were in some cases on the bleeding edge of this early on, Comcast, NBCU, [companies] that were kind of coming along as fast followers. It was [about] understanding how an organization adapts over time.The opportunity here is immense. We’re the world’s largest restaurant company and that scale is one of the biggest advantages. If you can figure out how to deal with more of these harmonized platforms, we’ll have more data than anybody else, we can use it better than anybody else, we can provide same store economics that are superior to anybody else in our industry.
Having ‘one of everything’ can present its own challenges. Take Point of Sales [PoS], for example. Davies reckons that he found around 200 different types across the group when he joined and even then he was told that he was “off by an order of magnitude of about ten”. Keeping on top of an infrastructure estate on a global scale is a big ask, but Yum! Had put the building blocks in place, he recalls:
I was really lucky when I got here, we’d already put a ton of work into our data infrastructure. We’ve decided we are going full cloud with a multi-cloud strategy. So you’re trying to put all the fun features around that typical cloud environment, and then put it into things like Snowflake that have now become a way to manage from a data warehouse or cloud environment.
For us on the team, we’re focusing on three pillars. We’re really trying to stretch out infrastructure, getting it right. We make the data available, make sure it’s accessible. Make sure it’s flexible, so they can use it. And then start building it into tools so that they can use it to make decisions…turn it into data products that actually work in the everyday business.
In terms of analytics, what’s on offer takes a variety of forms, he explains:
For example, we have what’s called predictive analytics platform that connects with our back house systems that will simply come in and say how much food’s going to be ordered, break that down to a recipe level and say, ‘Alright, how much inventory do I need?. That’s rolling out across 3,400 stores right now….We’ve got a tool that helps predict where to go build the next store, and what will happen there. And then [we have] what we call an internal analytic services platform, which is our new purchase from Quantum. When you look at a company like Yum!, you can imagine how much marketing we spend on an annual basis. That ability to actually integrate science into how we make those decisions, that’s where we want to go.
As to the wider mission statement, Davies is able to sum it up neatly:
We’re a restaurant company and we do it really well; we’re also a digital company that happens to be really good at food.
Image credit – Yum! Brands