The rise of AI and how it can help hospitality

Artificial Intelligence (AI) burst into the social consciousness with a bang in late 2022. The technology, which has actually been around for a while, is now taking off dramatically, with an expected growth of over 37% between now and the end of the decade.

Here we take a look at some of the ways in which AI may have a positive impact on the restaurant and QSR industries, either now or in the future, by exploring what it does really well, and how it can free up humans to do what they do best too.

Find customers

• Missing a call is deadly for restaurants – in fact 83% of customers will move on if they get voicemail. AI chatbots can understand and answer natural language questions  - such as taking a reservation or answering questions like ‘do you have wheelchair access?’ Answering the call and the question can save otherwise lost sales.
• Personalised marketing – AI can help you to tailor your email or SMS marketing based on customer preferences. So the meat lovers get information about your new burger and the vegans get an offer on your veggie pizza. People who feel valued and understood are more likely to come and spend with you.
• Customers are more likely to talk about you than to you, so monitoring social media platforms for mentions and sentiment is a good way to understand how the market really feels. AI can capture and analyse your mentions, allowing you to pre-empt issues and find opportunities to improve your offer.

Order taking – bigger, faster, more accurate

• In a world that is comfortable with Siri and Alexa, voice interaction with computers is growing in popularity - 50% of all mobile users in the US use voice search every day. AI can take voice orders accurately and fast, through the customer’s own device or at an in-store or drive-thru kiosk. 
• Add AI face recognition to pinpoint who the customer is, and then AI can access their previous orders and preferences to make upsell and cross sell suggestions,  increasing the order size. Face recognition is also increasingly being used for fast and secure payments, streamlining the ordering process even further.

Optimise delivery

• For restaurants with a range of delivery partner options, AI can very quickly analyse data from all the partners to show which one can pick up and deliver the order fastest, and at what cost. Restaurants can balance cost vs speed in selecting the partner for each order.
• For the delivery aggregators themselves, route optimisation is one of the things that AI can do much more efficiently than a person – which route will get the food delivered fastest, and/or how to combine multiple orders on a single route.  

Manage inventory and menus

• Purchasing is a balancing game – order too little and you miss sales; too much and you end up with waste that eats into profits. AI can take on board diverse sets of data, including past sales, forecast weather and events, and forecast demand for certain dishes and drinks, allowing you to order just the right ingredients.
• AI is also very good at ‘what if’ analysis – such as ‘what if the price of potatoes goes up by 3% next week, how will that impact my profit’. With data on current pricing, cost breakdowns of each dish and how much of each ingredient is used, AI can answer that question in a jiffy – it can then automatically make a dynamic change to prices or the menu, or the restaurant can choose to pass the analysis to the human manager to make that decision.

Manage staffing levels

• Just as purchasing ingredients is a balancing act, so too is staff planning – too few rostered on staff and you impact customer satisfaction, and too many simply increases costs. Smart rostering systems, based on AI technology can predict customer demand patterns, based on historical data and on external factors, such as local events, sporting fixtures or weather forecasts, and build an optimal staffing plan.  

The ways in which AI can be used in restaurants and QSRs are broad and far reaching – AI, which is already embedded into some hospitality solutions, is a valuable tool to help increase sales, cut costs, speed up service, and ensure consistency. But it cannot do everything in hospitality, nor would most restaurants want it to. There is a place for AI, but in this sector, there will always be a place for human skills too. 

AI is great at analysing large quantities of data, spotting patterns and finding optimisations. People are excellent at making customers feel welcome, empathising, and providing the ‘human touch’. So the real benefits of AI are twofold – in the savings and efficiencies they can drive, and the time they free up for humans to do what they do best – providing a great guest experience. 

This article was written by Redcat for QSR Media.