McDonald's Reportedly Using AI to 'Dynamically' Price Its Burgers

McDonald's reportedly employs AI technology to dynamically adjust burger prices based on what customers in the vicinity are willing to pay. While franchisees maintain control over the final prices, some franchisees feel compelled to adhere to the algorithm's recommendations. McDonald's monitors compliance with the platform and flags any deviations from its price suggestions, according to Reuters.

The interface provided to franchisees reportedly reveals insights like the "medium sensitivity to price" of the medium burger, depending on customer willingness to pay in the specific area. Cost disparities between nearby locations can be significant, as seen with a Bic Mac priced at $5.69 at one Fresno, California store versus $6.89 at another branch just two miles away, a 21 percent difference.

The company acknowledges that this dynamic pricing system could lead to legal complications and continues to promote the platform. McDonald's terms of service warn franchisees that they may be competitors of each other and emphasize the importance of complying with antitrust and competition laws. The document also states that franchisees are always free to set the final price, potentially absolving corporate from any antitrust concerns.

McDonald's has dismissed Reuters' reporting as speculative and uninformed, stating that the pricing portal is a tool, not a mandate, to help franchisees offer value to customers and make informed business decisions. The company has been utilizing this technology since at least 2019, with CEO Kempczinski claiming in 2023 that they had developed proprietary tools to evaluate pricing at individual restaurants.