How Taco Bell's AI Boosts Sales One Byte at a Time

Yum Brands, the parent company of KFC, Taco Bell, and Pizza Hut, shared that its investment in AI-driven marketing is paying off by boosting consumer engagement, reducing churn, and driving more purchases. In its Q3 earnings report, CFO Chris Turner highlighted the success of personalized AI-powered campaigns compared to traditional digital marketing, noting they led to "significant" engagement increases. While specific metrics weren't disclosed, Turner provided insight into the workings of Yum's “AI factory,” which collects data from multiple sources, such as Taco Bell’s digital menu boards and loyalty program, to create targeted promotions and refine customer insights.

The company sees the scalability of these AI capabilities as a big win, with pilots across its major brands in the U.S. showing strong returns on marketing investments. Turner confirmed Yum’s intention to expand the AI solutions both by brand and market, noting that Taco Bell’s AI initiatives, especially in drive-thru voice tech, have been well-received by customers. Unlike other brands, Taco Bell’s AI-driven interactions have avoided the issues of inaccurate responses, which have plagued some fast-food AI deployments. Currently, Yum has over 40 AI projects in various stages, a testament to its commitment to tech-driven innovation.

Taco Bell continues to be a standout performer for Yum, posting a 4% year-over-year growth in same-store sales and a 30% increase in digital transactions for the quarter. With these results, Yum Brands is doubling down on AI, confident that this approach is helping build both engagement and revenue across its portfolio.

Full story at Marketing Dive.