🍔 Yum! Brands: Cooking A Digital Recipe?
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🍔 Yum! Brands: Cooking A Digital Recipe?
Yum! Brands (YUM) prioritises its digital presence as the company acquires two technology companies in just a month. (Tweet This)
Background: Originally a subsidiary of PepsiCo as Tricon Global Restaurants, Yum! spun off as an independent entity in 1997. Since then, the company has built an international presence in over 150 countries, with 50K+ restaurants and 1M+ associates worldwide. Home to globally popular brands such as KFC, Pizza Hut, and Taco Bell, Yum! went public the same year. As of 2021, the company has a market value of $32.7B.
Late last month, we referred to Yum!’s partnership with Beyond Meat to cater to consumers’ changing trends. Even as the pandemic severely dented the restaurant business around the world, Yum! found success by going digital. The pandemic provided just the fillip the company needed to make significant inroads through digital sales, and it seems like Yum! is just getting warmed up. The company’s digital sales grew by 45% in 2020, bringing in a record of $17B.
Although the company’s Q4 earnings beat estimates, it still has ground to cover to come back to pre-pandemic levels. Hence, in an uncertain climate, the company has chosen a safe path, doubling down on its digital transition.
What Happened?: Yum! recently announced its acquisition of Tictuk Technologies, an Israeli company that allows customers to order food while on social media and messaging apps. Aiming to hold on to the digital gains made during the pandemic, Yum! has already deployed Tictuk across 900 restaurants of their brands in 35 countries. Tictuk will continue to cater to its existing third-party clients in addition to supporting Yum!
Before Tictuk, Yum! also acquired Kvantum, an AI-based consumer insights, and marketing analytics company. Kvantum combines machine learning (ML) and econometric modeling in its platform to measure marketing tactics in a specific geography. Kuantum’s machine learning technology will complement the data churned out by Collider Labs, which provides culture-based insights into customer preferences. Collider Labs was acquired by Yum! in 2015.
The cost of these two all-cash acquisitions hasn’t been disclosed yet. Be that as it may, it’s clear Yum!’s foray into AI and ML is here to stay, pandemic or not. Strengthening the digital presence to improve customer experience is no longer a luxury for businesses - it’s become a prerequisite!
Market Reaction: YUM closed the day at $109.21, up 1.06%.
Company Snapshot 📈
YUM $109.21 +1.15 (1.06%)
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Later Today 🕒
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Fun Fact of The Day 🌞
An ant can lift 20 times its bodyweight.
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