Inside McDonald’s Push to Use AI to Price Big Macs

Summary

McDonald’s is increasingly using an AI-driven pricing engine to recommend prices for menu items at restaurants across the U.S. and some international markets. The machine-learning system analyzes data from millions of daily transactions across nearly 14,000 restaurants and estimates factors including how much customers in an area may be willing to pay. Reuters reviewed screenshots and spoke with nine people familiar with the strategy. The system has widened price differences for identical products, including a reported example of Big Macs priced at $5.69 and $6.89 at two company-run restaurants two miles apart, although Reuters could not confirm that the engine caused the difference. McDonald’s says franchisees remain free to set final prices, but several owners described pressure to use the recommendations, and company materials track deviations from them. New business standards require franchisees to engage with approved pricing consultants and tools, while executives have referred to pricing non-compliance in business reviews. The company benefits when higher franchise revenue increases its percentage-based income, whereas franchisees must balance corporate affordability goals against rising local costs. The system has been used in some form since at least 2019 and once drew attention after an alleged recommendation of an approximately $18 Big Mac meal, which McDonald’s disputes. The company says the tool is intended to support restaurant-specific decisions, but legal experts and the company’s own portal terms acknowledge possible antitrust scrutiny because franchisees may compete with one another. The engine is operated with input from Tiger Analytics and follows corporate rules, such as limiting some seasonal price increases. Despite more conservative recommendations recently, McDonald’s U.S. foot traffic has declined year over year in every complete month since March, according to Placer.ai estimates.