Small Biz Can Learn from Taco Bell’s Improved AI Marketing

December 02, 2024

technology partner

From personalization to A/B testing and more, AI is invading retail and restaurant spaces. WSJ dives into the benefits of Taco Bell using AI. But this only showcases how even smaller companies which much smaller budgets can also use AI for their own needs.

While major restaurant chains like Yum Brands (KFC, Pizza Hut, and Taco Bell) are implementing sophisticated AI-driven marketing campaigns, small businesses can adopt similar strategies at a smaller scale. Here’s how local businesses can apply these enterprise-level insights to their operations.

Personalized Email Marketing

Large chains are seeing double-digit increases in customer engagement through AI-powered email campaigns. Small businesses can implement this approach by:

  • Segmenting customers based on their purchasing patterns (frequent vs. occasional buyers)

  • Using affordable AI email marketing tools to optimize sending times and subject lines

  • Creating different email templates for various customer segments (new customers, regulars, seasonal shoppers)

  • Analyzing customer purchase history to send relevant offers at the right time

Smart Timing and Targeting

Just as Pizza Hut identifies different customer types (regular orderers vs. special occasion customers), small businesses can:

  • Track customer visiting patterns using their POS system data

  • Create specific promotions for different customer segments

  • Consider external factors like weather and local events when planning promotions

  • Use seasonal data to predict busy periods and adjust marketing accordingly

Real-Time Testing and Optimization

While Yum Brands uses sophisticated reinforcement learning, small businesses can still implement simplified versions:

  • Use A/B testing features available in common email marketing platforms

  • Monitor social media engagement metrics to understand what content resonates

  • Track the performance of different offers and promotions in real-time

  • Adjust marketing messages based on immediate customer feedback

Location-Based Marketing

Taking inspiration from the chains’ location-specific approaches, local businesses can:

  • Use local weather patterns to trigger specific promotions

  • Create special offers based on neighborhood events or local activities

  • Adjust pricing and promotions based on time of day

  • Target ads to specific geographic areas using social media platforms

Customer Recognition and Personalization

While major chains use sophisticated apps and check-in systems, small businesses can create simpler loyalty programs that:

  • Track customer preferences and purchase history

  • Offer personalized rewards based on buying patterns

  • Create targeted promotions for specific customer segments

  • Use digital loyalty cards or simple check-in systems

Getting Started with AI Marketing

1. Start Small

  • Begin with one aspect of your marketing (like email or social media)

  • Use existing AI features in common marketing platforms

  • Focus on collecting and analyzing customer data

  • Test and measure results before expanding

2. Use Available Tools

  • Email marketing platforms with AI capabilities (Mailchimp, Constant Contact)

  • Social media scheduling tools with optimization features

  • Basic CRM systems to track customer behavior

  • Simple loyalty program software

3. Focus on Data Collection

  • Implement a basic customer database

  • Track purchase patterns and preferences

  • Collect email addresses and contact information

  • Monitor busy times and seasonal patterns

4. Maintain the Human Touch

Remember that AI should enhance, not replace, personal relationships with customers. Use technology to:

  • Identify opportunities for personal outreach

  • Free up time for face-to-face customer interaction

  • Support, not replace, human decision-making

  • Enhance existing customer service

Cost-Effective Implementation

While major chains invest heavily in custom AI solutions, small businesses can:

  • Start with free or low-cost AI features in existing marketing platforms

  • Gradually add more sophisticated tools as ROI is proven

  • Focus on one channel at a time to manage costs

  • Use data from initial efforts to justify further investment

The key lesson from major chains’ AI initiatives is that personalization and timing matter. Small businesses can start small, use available tools, and gradually build more sophisticated marketing approaches based on their specific needs and resources.