McDonald's has been using AI to decide how much you should pay for a Big Mac

[Daniel Sims]

Recap: McDonald's has made several attempts to deploy AI across its businesses over the past few years, not all of them successfully. A recent extensive report sheds light on one area where the fast-food giant has had a long and potentially lucrative history with machine learning and algorithms: dynamic pricing.

Several sources, including store owners, recently explained to Reuters how McDonald's encourages and sometimes pressures restaurants to set prices according to an AI algorithm. The outlet also viewed screenshots of an AI pricing tool taken in August.

The system aims to determine how much customers are willing to pay by reviewing data from millions of transactions across the fast-food chain's nearly 14,000 restaurants, as well as prices from online menus at nearby rival chains such as Wendy's. The tool might warn a franchise owner that their restaurants are exhibiting "medium sensitivity" to prices based on local customers' "willingness to pay." Although Wendy's says that it does not currently use AI to set prices, the chain got into trouble over plans to test the practice in 2024.

Although store owners can set prices with or without AI based on local costs, the algorithm might widen disparities even between nearby restaurants. For example, a company-run McDonald's in Fresno, California, might sell Big Macs for $5.69, while another restaurant just two miles away might charge $6.89 – 21% more.

McDonald's has been using AI-based pricing in one form or another since 2019, and in one extreme case, a franchise owner sued the company after feeling pressured to charge $18 at a store off a Connecticut turnpike.

The company claims that store owners are free to choose whether to follow the algorithm, but sources told Reuters that they have little choice. Some store owners described receiving phone calls from the company asking why they had strayed from the algorithmic recommendation, and McDonald's tracks deviations in detail. The decision might also affect whether franchisees are allowed to open more restaurants. In some cases, owners might also clash with corporate after setting prices higher than the AI's suggestion to keep up with local maintenance and labor costs.

Furthermore, the company explicitly directs franchise owners to comply with antitrust laws, acknowledging that AI-based pricing could draw accusations of price fixing or collusion. McDonald's warns that nearby franchises may view each other as competitors.

McDonald's has tried unsuccessfully to deploy AI in multiple customer-facing ways over the past few years. In 2024, the company ended an agreement with IBM to take orders via chatbots, something DoorDash now plans to do via Apple Messages. In 2025, McDonald's hiring chatbot exposed the personal data of 64 million applicants. Later that year, the company pulled an AI-generated Christmas ad after massive backlash.

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McDonald's has been using AI to decide how much you should pay for a Big Mac

 

[Win7user]

I stopped eating at MacDonald's almost 18 yrs ago. They serve garbage and they charge way to much for it. When I was kid, [14) I ate at MacDonald's every day at lunch [1972] freshman in high school. Of course the price was cheaper, [.79 including tax for a Bid Mac, fry, and a drink) but more importantly the people working there had a work ethic, they acknowledge your presence [customer] and they actually worked, unlike today when they simple ignore you at the counter for five minutes or so. At least 18 yrs ago that was the case. I'm sure it's much worse now, with these indoctrinated Gen Z fools.The food was cooked as you ordered it, and the cheese was actually melted on the burger!! The restaurant was pretty clean as was the bathrooms... We have multiple generations today, that simply don't care about a work ethic, or doing an honest days work for their money. They belong at MacDonalds....

 

[NumberNine]

McDonald's doesn't make food anymore, just money. Haven't eaten there in years because we have places here that cook actual hamburgers for lower prices.

 

[LordVile95]

Jokes on them I don’t buy Big Macs

 

[yRaz]

The thing about McDonald's is that it was never "great" food, I didn't go there for the food. I went there so I could eat something and my kid could run around and play for an hour. The food wasn't good, but it was cheap and filling. The portions are smaller, it's not cheap and it's not fast.

You can use AI all you want to judge the price of a big Mac but they got rid of what people fundendemally like about McDonald's. It was cheap food and a place to go where parents could get a break. It's neither of those things. It's like if a tire shop stopped selling tires and then they wondered why people stopped coming in

 

[Plutoisaplanet]

McDonald's doesn't make food anymore, just money. Haven't eaten there in years because we have places here that cook actual hamburgers for lower prices.

They never did. McDonalds is not a fast food company; it's primarily a real estate company. It only owns 5% of its own restaurants and has a 16% operating margin on those. For franchised restaurants, it has almost no costs and makes over 80% profit on those (from real estate and its brand alone). That said, it makes a significant chunk of money from its own restaurants, but it still makes >50% more from its franchisees.

 

[DrSuess]

The thing about McDonald's is that it was never "great" food, I didn't go there for the food. I went there so I could eat something and my kid could run around and play for an hour. The food wasn't good, but it was cheap and filling. The portions are smaller, it's not cheap and it's not fast.

Its where I go when I am hungry but just can't decide what I really want to eat. I no longer eat any of their burgers they are horrible and tasteless. The only thing I like now are the fries.

 

[yRaz]

Its where I go when I am hungry but just can't decide what I really want to eat. I no longer eat any of their burgers they are horrible and tasteless. The only thing I like now are the fries.

I went there in college because I used to be able to eat for a handle change and I went there as a parent because I could get a meal for roughly what it would cost to eat at home and I got about an hour away from parenting. If I have to pay 8 or 9 dollars for a single sandwich I can buy a pound of ground beef and feed all of us at home for the same money. I can eat for 3 days for what an hour at McDonald's costs and it's probably healthier. No amount of AI will fix that.

 

[Plutoisaplanet]

Its where I go when I am hungry but just can't decide what I really want to eat. I no longer eat any of their burgers they are horrible and tasteless. The only thing I like now are the fries.

You realize that even their fries have no flavor? You're just eating salted deep-fried oil residue.

If you can't decide what to eat, you're better off buying a frozen entrée from the grocery store to stick in the microwave. It will also have no flavor, but be far cheaper ($2-4), a little bit healthier, and probably take less time than McDonald's does to cook. Even better, you don't have to deal with underpaid workers, just walking 150-200 feet.

 

[winjer]

As if people needed more reasons not to go to McDonalds.

 

[Theinsanegamer]

Digital pricing systems are just another way for corporations to enforce the K shaped economy by scalping anyone with more then the bare minimum.

Stop eating slop.

 

[GABulldog]

People didn't eat at McDonald's because they serve great food, they ate at McDonald's because it was cheap and convenient. No matter how much they try and raise their prices, at the end of the day they'll still be known as selling sub quality food.

 

[ScottSoapbox]

People are mad about this but no one is forcing anyone to buy Big Macs.

If the price is too high for their customers, the customers go somewhere else and then the prices come back down.

And deciding to never visit McD's again after learning of their dynamic pricing is an option as well. That's how voluntary exchange works. It's voluntary on both sides.


(Sure, people should go to a grocery for sandwich supplies for a better and cheaper "fast food" alternative, but those people aren't their customers.)