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Taco Bell Owner Yum Brands Buys A.I. Business to Improve Marketing

Scott Mlyn | CNBC
  • Yum Brands bought Kvantum, a company that uses artificial intelligence for consumer insights and marketing performance analytics.
  • Financial terms of the deal were not disclosed.
  • In the last decade, restaurant companies have been buying technology to drive sales growth.

Yum Brands announced Tuesday that it has bought Kvantum, a company that uses artificial intelligence for consumer insights and marketing performance analytics.

The Taco Bell owner plans to use the acquisition to optimize its marketing spending, giving it a leg up on fast-food rivals. In the last decade, deal-making in the restaurant industry has expanded from adding more portfolio brands to purchasing technology that can drive sales growth for the buyer.

Several of Yum's international markets have already worked with the U.S.-based Kvantum, which was founded in 2012.

"Kvantum is an innovator in data analytics and marketing optimization and has a proven track record of delivering significant value to several of our international markets by enabling data-driven marketing decisions to increase sales and better leverage media budgets," Yum Chief Digital and Technology Officer Clay Johnson said in a statement.

In 2015, Yum acquired Collider Lab, a consulting firm that hires sociologists and anthropologists to provide culture-based consumer insights. Yum plans to combine the newly acquired machine learning approach with Collider Lab's data.

The Kvantum business unit will still consult with clients outside the restaurant industry once it's part of Yum. The deal is expected to close at the end of the first quarter, subject to standard closing conditions. Financial terms of the acquisition were not disclosed.

Shares of Yum fell less than 1% in morning trading. The stock has risen 12% over the last year, giving it a market value of $31.3 billion.

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