How will AI change the restaurant business?

Fast Company

2 days ago

But many feel unprepared to handle its implementation.
That's according to a new survey from consulting firm Deloitte that asked hundreds of restaurant industry executives about their current use and future plans for AI. Overwhelmingly, respondents cited AI's potential to enhance the guest experience; to make a customer's time more enjoyable, comfortable, and memorable, as a top benefit of the tech. In fact, almost all—98%—operators in the survey said they expect a high impact on the customer experience in three years.
AI is already showing up to help restaurant guests. It answers the phones, works the back office, and helps with marketing efforts. Eventually, it'll show up during table service. Plenty of restaurants are already using AI to their advantage; 8 in 10 industry leaders surveyed by Deloitte say they'll increase spending on the tech in the next year.
Most of the survey's respondents work in quick service restaurants; nearly half work as franchise operators for larger brands. But that doesn't mean AI and its benefits are reserved for corporate restaurants.
'Big chains are usually first to test new technologies in the restaurant space, and AI is no different,' says Emma Blecker, a New York-based operations consultant. 'It makes sense, the tools are often built for them, and they've got the resources to spend on research and development, pilot programs, training, and rollouts. But that doesn't mean small operators are missing out.'
For now, she advises, restaurants of all sizes can learn from industry early adopters, experimenting with new tech tools and ideas, like these:
AI can handle the conversation
According to Deloitte's survey results, less than 1 in 5 surveyed leaders use conversational voice AI—tech that can talk—in their restaurant's daily operations now. But they plan to; roughly a third are testing or piloting the tech, with another third planning or developing a conversational AI strategy.
Voice AI can staff a drive-thru, taking orders and upselling to guests with smart add-ons—think: 'Do you want fries with that?' except instead of blindly suggesting a side of fries to every customer, it uses factors like their order, time of day, or even the weather to suggest something else.
It can also answer their phone, providing diners with info on location, hours, reservations, and other details, a boon for busy restaurants, like perennial San Francisco favorite Flour + Water, which tapped a local service called Hostie to work the phones. It's already made guests and employees happier.
'We're finding that people walking in the door already have answers to some of the questions they'd walk in with prior,' says Amanda Flores, director of operations for the Flour +Water restaurant group. 'That means fewer people walk in frustrated and the host gets to spend more time with people that are stoked to be here with their questions already answered.'
AI targets the right diners
Restaurant software has long collected data on diners—average spend, visit frequency, dining preferences—and AI can help make sense of all the numbers.
For example, a text-based feature from reservations and customer relationship management platform SevenRooms helps restaurants segment customers into target groups and generate text messages to invite them to special events, share new menu items, or offer same-day reservation nudges. Celeb-chef backed Fabio Viviani Hospitality group, an early product tester for SevenRooms, said the tech helped book 1,800 reservations and drove close to half a million dollars in revenue in six months. The group's chief marketing officer said the texts had a 98 percent open rate.
About half of restaurant operators in the survey say they already see a high impact from AI-enhanced loyalty tech; another quarter think they'll see a high impact in three years.
AI is coming to the table
The case for AI at fast food and other casual restaurants is straightforward; it can make the experience faster, easier, and more pleasant for people on both sides of the transaction. But integrating technology into full-service dining is a trickier proposition; even the best bots can't replace warm, in-person hospitality.
But it can certainly help, and a new generation of devices has the potential to enhance human service. Plenty of companies are working on new, hands-free devices—pins, glasses, earpieces—though transformational change is likely years away. (Jony Ive, the longtime Apple design exec and architect of the iPhone, recently sold his new company to OpenAI with vague promises to right the iPhone's wrongs, moving our eyes from screens to reality.)
In fact, it's already being tested. Yum China, the Shanghai-based parent company of American brands KFC, Taco Bell, and Pizza Hut and also the largest restaurant company in that country, just debuted a hands-free AI assistant for some of its KFC restaurant managers. They wear earphones and smart watches wired to process language and offer help, from inventory reminders to real-time troubleshooting. It's a pilot program, but the point is to help employees look up from screens and better interact with the physical world in front of them.
Still, practicalities might slow progress. In Deloitte's survey, less than a third of industry leaders said their business's tech and talent are ready to implement big AI-related changes.
In a recent conversation, Kelly Esten, chief marketer for restaurant point of sale company Toast, declined to speculate on how soon transformative new hardware might arrive at America's restaurants. But Esten agrees it's coming.
'I do think we're going to go through another platform shift,' she told me, 'and it creates a tremendous amount of opportunity for restaurants and for restaurant tech.'