How Restaurants Use AI to Improve Margins and Customer Experiences

Benefits of chatbots for restaurants

With the advent of artificial intelligence streamlining businesses, restaurants stand to make great gains in service to their customers by leveraging technology. Expanding the application of existing technologies, like chatbots, will help restaurants meet the demands of their millennial clients, and help provide immediate access to service while improving margins. Here are some highlights of how AI is changing the restaurant industry.

What are Chatbots and How Do They Impact Restaurants?

Chatbots are computer applications powered by artificial intelligence to communicate with humans. They are designed to mimic natural human conversation via an online chat interface, SMS, and sometimes voice chat. Despite being designed for human consumption, chatbots are also capable of communicating and gathering information from other chatbots.

(To know about the history of chatbots, click here)

Customers have readily embraced the modern age in all facets of life, but particularly when it comes to ordering goods and services online, such as food. Aiding in this are AI-powered chatbots, which allow the users to place the order from their device with the help of a chatbot.

With the AI ability extended from text processing to speech, chatbots are no longer just a chat window on a website or a mobile app. AI-powered speech processing systems like IBM’s Watson, Apple’s Siri, Google’s Google Home, and Amazon’s Alexa, has changed the applicability of AI concepts from scientific applications to the daily lives of everyday people. With smartphone users expected to reach 6 billion globally by 2020, the speech-based chatbot’s implications in customer service are expected to make up large parts of company’s marketing strategies in the future.

The trend of chatbot service has already started, where giants like Pizza Hut, KFC, Dominos, Starbucks and McDonald’s have already adopted AI-driven bots.

How Chatbots Reach New Clients

The best part of chatbots is to generate personalized experience, and redefines the way customers are serviced. It facilitates the customers to interact with the bot at their convenience, either by speech or text. The chatbots powered by the speech processing technology enables the customers to speak with the bot (like human) even sitting away from your devices.

The chatbot applications, like Google home and Alexa echo, empowers customers with tailored voice experiences. These humanoid chatbots deliver instant and effective solutions, thus resulting in greater customer experience. Based on the customer behavior analytics, the chatbots assist management to study the trends and to deliver, either what the customer is expecting or reach out the customers who are looking for the recipes offered by their restaurant (through customized push notifications).

The social media usage is growing exponentially with smart mobile devices (tablet, laptops, Tabs, and smartphones) users. The restaurants by integrating the chatbot application with the social media chat messenger (like Facebook, Twitter) can reach out to social media users easily.

 Wingstop's a bot service built into both Facebook and Twitter and the online sales for this Dallas-based brand account for 16.9 percent of total sales and are growing rapidly."

The Handguards University

Like this highlight above on the power of chatbots in social media and restaurant success AI can make a difference. Unlike human executives, chatbots can attend any number of customer interactions at a time. This avoids the irritating wait times in IVR or all time busy customer executives. The chatbots enable customers to book a table and order customized food even before reaching the restaurant, this avoids the wastage of time in delivering the order to your table.

Restaurant Marketing 101: Show Up Where Your Customers Live

Customer Experience is the new marketing. If you don’t have a passionate, committed executive leadership team, you won’t get out of the gate unless you have that. Customer experience better be at the top of your list when it comes to priorities in your organization.”

Steve Cannon, President & CEO of Mercedes-Benz USA

Customer engagement, retention and satisfaction are the key aspects of any service industry. The most common customer engagement question in the restaurant industry is, “We provide tasty food, yet we are still finding difficult to improve customer satisfaction and retention?”. The distinguishing factor is the “Customer Service Experience”, this evolved as new marketing scope.

 65% of consumers surveyed said they’ve cut ties with a brand over a single poor customer service experience."

Parature State of Multichannel Customer Service Survey

It is stated by the various customer research reports that even one poor customer service could result in a lost relationship with the customer. In this regard, chatbots can deliver service 24/7, which may not be possible by humans, as they must go home and spend time away from work where they cannot answer customer queries.

Chatbots help in dealing with the challenges faced by the restaurant industry with analytics, as well. Chatbots can help management gather and organize sales data, then strategize their marketing efforts based on location and customer interests. This helps management to deliver personalized marketing plans, push notifications (about loyalty programs or new items) and personalized dining experiences to the customers. This instills a feeling of community with the customers, which ultimately helps the management retain customers as well as increase their satisfaction.

Affordable Chatbot Technology

Chatbots offer 24/7 customer service, which can be very costly if human employees were to be hired as 24 hour customer service. In this way, a chatbot saves effort, time and money. The ability to have chatbot integration within social media messengers makes bots cost effective for even a small business. It is a one-time investment, rather than hiring a salaried staff. According to Business Insider’s report that chatbots have the capability to save businesses up to 30 percent more, as compared to traditional customer service.

Chatbots could save $174 Billion across Insurance,Financial Services,Sales, andCustomer Service"

BI Intelligence, McKinsey & Company, and the US Of­fice of Personnel Management, 2016

How Restaurants Can Benefit From the Evolution of Technology

While chatbots offer many benefits, the most significant of them are listed below:

  • Book tables and orders, even before the customer has reached the restaurant.
  • Customers can track the status of their orders.
  • Serve any number of customers 24/7
  • Personalized marketing
  • Customer analytics
  • Does the job of many employees and avoids employees training cost
  • Integrate chatbot to social media and make use of vast social media user base
  • Increases brand engagement
  • Businesses can stay in direct contact with the customers, which will enable to stop unnecessary revenue share with services delivery mediums, such as Postmates.

A business’s success all lies in delighting customers. So, delight your customers by integrating AI-powered chatbots in to your business strategy to deliver the best customer experiences and enjoy improved margins.

Chatbots for business

Topics: Chatbots for Restaurants, Chatbots, Artificial Intelligence, Technology, AI for Restaurants, AI

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