Dynamic Yield Acquisition: Key Details, Impact, and What Comes Next

Mastercard's acquisition of Dynamic Yield from McDonald's marks a significant move in the personalization technology sector. This strategic purchase aims to bolster Mastercard's consumer engagement and loyalty services, integrating Dynamic Yield's advanced AI capabilities to deliver tailored customer experiences. The acquisition underscores the growing importance of personalized interactions in enhancing brand loyalty and customer satisfaction across various industries.

What Is Dynamic Yield?

Dynamic Yield, founded in 2011, specializes in personalization and experience optimization solutions. Its core product, the "Experience OS," offers capabilities such as audience discovery, content targeting, product recommendations, customer engagement, and A/B testing. Unique in the market, Dynamic Yield's holistic AI personalization system anticipates customer behavior, while its scalable and secure platform is designed for enterprise applications. Recognized by industry analysts, it provides extensive integration capabilities and rapid onboarding to ensure quick results.

Who Acquired Dynamic Yield?

Mastercard is a global technology company in the payments industry, playing a pivotal role in facilitating secure and efficient transactions worldwide. The company offers a range of payment solutions, including credit, debit, and prepaid cards, as well as digital payment technologies. Known for its innovation and reliability, Mastercard holds a significant market position, influencing the way consumers and businesses conduct financial transactions across the globe.

When Was Dynamic Yield Acquired?

Mastercard completed its acquisition of Dynamic Yield on April 4, 2022. This acquisition aligns with Mastercard's strategy to enhance its consumer engagement and loyalty services. The timing is significant as it follows a broader industry trend towards personalized customer experiences, driven by AI and data analytics. Dynamic Yield's technology, previously integrated into McDonald's operations, will now bolster Mastercard's capabilities in delivering tailored customer interactions across various channels.

Why Was Dynamic Yield Acquired?

• Market Expansion: The acquisition of Dynamic Yield allows Mastercard to extend its consumer engagement services and help more brands create stronger connections across channels. This move signifies Mastercard's efforts to expand its market presence in consumer engagement and loyalty services. Additionally, Dynamic Yield plans to expand its services beyond McDonald’s to other potential customers in the Quick Service Restaurant (QSR) category, leveraging its experience and technology to offer personalized recommendations.
• Technology Integration: Dynamic Yield’s state-of-the-art personalization platform and decision engine will be integrated into Mastercard's existing services. This includes individualized product recommendations, offers, and content based on factors like past purchases and customer affinity profiles. The technology has already been integrated into McDonald’s drive-thrus and ordering kiosks, and will now be scaled globally. Mastercard intends to use Dynamic Yield’s technology to enhance its Data & Services division, which includes marketing services, consulting, self-service analytics tools, and test-and-learn analytics tools.
• Competitive Advantage: By acquiring Dynamic Yield, Mastercard enhances its ability to deliver highly relevant, personalized consumer experiences, which is a significant competitive advantage. The integration of Dynamic Yield’s technology with Mastercard’s existing merchant loyalty platform SessionM and Test & Learn software creates unique synergies that strengthen Mastercard’s digital engagement capabilities. This positions Mastercard as a leader in providing advanced consumer engagement solutions. Additionally, Dynamic Yield’s ability to provide personalized recommendations based on past orders and general purchase patterns offers a competitive edge in the QSR market.

Acquisition Terms

• Acquisition Price: The acquisition price was not publicly disclosed.
• Payment Method: The payment method was not specified.
• Key Conditions or Agreements:
  • Dynamic Yield will join Mastercard’s Data & Services organization.
  • McDonald's plans to further scale and integrate Dynamic Yield’s capabilities globally and across order channels.
  • The transaction is subject to customary closing conditions.
  • Upon closing, Ori Bauer, the current Chief Technology Officer, will become the CEO of Dynamic Yield, while Liad Agmon, the current CEO, will stay on in an advisory capacity.

Impact on Dynamic Yield

The acquisition of Dynamic Yield by Mastercard has led to significant changes in operations and management. Ori Bauer, previously the Chief Technology Officer, has taken on the role of CEO, while Liad Agmon, the former CEO, remains as an advisor. Dynamic Yield has been integrated into Mastercard’s Data & Services organization, which includes over 2,000 data scientists, engineers, and consultants. This integration aims to leverage Dynamic Yield’s decision technology to enhance Mastercard’s consumer engagement services, providing more personalized and effective customer experiences.

Dynamic Yield’s product offerings and services have also seen notable enhancements. The technology continues to be used by McDonald's in digital kiosks across 15,000 locations, and Mastercard plans to expand its application to other potential customers in the Quick Service Restaurant (QSR) category. Employee reactions have been positive, with key executives expressing excitement about the potential for stronger consumer engagement services. Customers, including brands and merchants, are expected to benefit from more personalized and relevant experiences, although specific customer reactions have not been detailed. For founders considering business transitions, tools like Sunset can assist in managing such processes compliantly and efficiently.