It is reported that this system analyzes millions of transactions per day from nearly 14,000 restaurants and generates what the company calls the “optimal price” for each menu item at each store. Screenshots of the interface used by franchisees reviewed by the organization show that the system prompts restaurant owners about the prices of their establishments.MEDIUM SENSITIVITY(Medium sensitivity), and part of it is based on 'how much customers in your region are willing to pay.'
Three franchisees stated that this system has widened the price gap between restaurants selling the same product, including differences between different communities within the same region. In September, Reuters observed the McDonald's app and found that a company-operated restaurant in Fresno, California, priced a Big Mac at $5.69, while another company-operated restaurant just two miles away sold it for $6.89, a 21% difference. Reuters was unable to confirm whether this disparity was caused by this system.
According to two former employees of Tiger Analytics, this AI platform is operated by Tiger Analytics, while McDonald's provides the rules and company objectives. These parameters include focusing price increases on products that have not seen a price rise in the past two years, as well as excluding ice cream and soft drinks from the scope of price increases during the summer. Tiger has refused to comment on this matter.
According to official statements, franchisees set their own prices. Five store owners mentioned that the company exerts pressure on them to follow the recommended pricing; a document from June shows that McDonald's keeps detailed records of instances where prices deviate from the recommendations. Since January, franchisees have been required to cooperate "constructively" with the company-approved pricing consultants and tools. CEO Chris Kempczinski reportedly told investors in August that "non-compliant pricing" in certain situations is part of the franchise business review process.
Pricing portals' legal terms warn shop owners that they 'may be competitors with one another' and should comply with anti-monopoly laws.
Similar systems have previously triggered consumer backlash. Wendy faced criticism in 2024 due to reports that it intended to charge higher prices during peak hours. The company stated that these reports misinterpreted the financial report updates regarding the digital menu boards; they claimed that the digital menu boards would make it easier to adjust menu displays and offer discounts, and that "prices would not be increased during the times when customers are most frequent." Instacart ended a limited test in December, during which the AI tool displayed different grocery prices to various shoppers.
