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McDonald's Is Using AI to Dynamically Price Its Burgers

33 points DeepLogin 20 hours ago 20 comments

m463 20 hours ago | parent

$18 big mac?

orionblastar 19 hours ago | parent

McDonald's is spending $8 billion to figure out why they can't sell enough food. Maybe lower prices instead of spending $8 billion?

triceratops 19 hours ago | parent

You gotta spend money to make money

DaSHacka 19 hours ago | parent

Well, it's clearly not working for mcdonalds

schiffern 14 hours ago | parent

"The spending money will continue until making money improves?"

Ekaros 11 hours ago | parent

Ah the VC model. I wonder how well that will out now that money is not cheap anymore.

karim79 15 hours ago | parent

> McDonald's is spending $8 billion to figure out why they can't sell enough food.

If one can call it food.

itopaloglu83 11 hours ago | parent

Low-quality ultra-processed food at previously fine-dining prices.

The inflation and preemptive price increases are really making things unaffordable.

I think this is just the Covid era price increases and its aftermath. And we haven’t seen the second wave that’s going to come from the recent oil shocks.

MustangMatt46 18 hours ago | parent

Great. I'll continue not buying them.

crmd 18 hours ago | parent

McDonalds used to be fun, whimsical places. The one now in my neighborhood feel like the DMV. What the hell happened?

jerlam 17 hours ago | parent

Same thing that happened to Starbucks. Online and drive-through orders make more money with less work, so they concentrated on optimizing those while killing the brand.

stubish 17 hours ago | parent

"always free to determine the final price" indicates they are aware they are forcing collusion and creating an illegal cartel. Head office telling two competing franchises how much to charge is essentially the same as two competing franchisees agreeing to pricing over a round of golf. If it gets that far, will be interesting to see who ends up holding that bag.

dataflow 12 hours ago | parent

Seems like that's the one weird trick to escape the law in the land of the free:

> McDonald's has power over decisions that can make or break a franchisee's business, such as their eligibility to renew or open new stores.

You're free to reject their prices but they're free to refuse to renew your contract. After all, what is the government going to do, force two parties to do business with each other and renew a contract? Freedom for all.

stubish 17 hours ago | parent

I'm surprised the market accepted this sort of franchisee set pricing. When I saw how airport prices differed from regular prices, I just tried harder to avoid airport food. Its a world where people drive distances for a cent per liter in petrol, but they don't pay attention to where they can get their same dinner cheaper?

donmcronald 17 hours ago | parent

They’ve been using some kind of dynamic pricing for a while. Last summer we decided to order McDonalds and I noticed it.

I have a nephew in high school. There’s a McDonalds that’s a close walk. A lot of kids hang out there and, in aggregate, they spend a ton of money. My nephew would often order through the app and his friends would give him cash. He’d end up with a bunch of rewards.

So, from McDonalds perspective he’s a customer buying tons of crap. Do you know what the true reward was? Price gouging, that’s what. In the app, everything was more expensive for him than it was for me.

So, since winning the lotto by having a McDonalds beside a high school isn’t enough, they’re ripping off their regulars. I hope they go broke. My family doesn’t spend money there anymore. We’re not price sensitive, but we’re definitely “getting ripped off” sensitive.

Screw McDonalds.

b0rtb0rt 16 hours ago | parent

interesting, for me the app is always way cheaper than ordering in person. but i guess i have no way of comparing with other peoples prices in their apps. what an age we live in

ChrisArchitect 17 hours ago | parent

Earlier: https://news.ycombinator.com/item?id=49899453

N_Lens 15 hours ago | parent

Our economy is becoming deranged & psychotic, the wheels are coming off. The old idea of a good product or service for a fair price is considered foolish in today's conditions.

In the end the economy is more like a religion than science - reliant on people's faith in the system. As that faith erodes and as central command structures fail to regulate the economy and people, it's going to be interesting to see what emerges from the chaos.

ulfw 13 hours ago | parent

It's profit maximizing before the fall

itopaloglu83 11 hours ago | parent

Yeah, this is better than “they’re cashing out before the crash”