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Artificial intelligence is fast becoming the latest tool in a fast casual's technology strategy but it requires a strong strategy and customer data insight in order to achieve a strong return on investment.
Simply, it's not a technology to just grab and plug in, revealed a panel talk at the recent three-day Fast Casual Executive Summit, held at the Hyatt Regency Lake Washington in early October.
The panel at the summit, which was run by Fast Casual's parent company, Networld Media Group, was moderated by Steve Bigari, CEO, of Syncq3 Restaurant Solutions, which sponsored the talk. Synq3 is a leading provider focused on order processing and guest relationships for the restaurant industry
Why now is the right time for AI
While AI requires a strategy, it's also not a technology that fast casual brands can afford to ignore. And some leading brands are already paving deep AI inroads, such as Pizza Hut and its self-driving cars and drones for delivery, and the burger-flipping robot at Caliburger. KFC is working on AI face recognition application to predict what customers may order.
The technology approaches are aimed at making the customer experience and journey happen wherever the customer is and making a purchase and experience easier than ever.
"Technology keeps getting smarter," explained Bigari as he kicked off the panel talk, adding "and restaurants are not behind when it comes to AI."
In fact, Bigari views AI and voice recognition technology as the "next frontier," given its wide and varied applications — from providing customers with recommendations to back-end operational efficiencies.
"It's about an all-out guest experience, always the same, even as much as things change," he noted.
One AI strategy in play by fast casual brands is using the Amazon Alexa voice recognition tool.
At Dickey's Barbecue Restaurants the tool is being tested with the goal of helping pit masters focus on their role and to streamline operations and help franchise operators keep point on daily business metrics, explained CEO Laura Rea Dickey.
Franchise operators can ask Alexa about sales at any point in the day, and pit masters can check with Alexa on rib cooking times.
"It's about making it simple, bite-size pieces, to drive user adoption [in the franchise]," said Dickey, who added that a critical aspect to making AI valuable is having a deep swell of data flowing into the organization.
The franchise built its own data warehouse platform and customer-reporting tools a few years back when it realized how critical customer and business operations data is to growth and sustainability. It's tapping AI to quell abandoned cars and online orders, not only to find out why a consumer disengaged but to entice the consumer back into the ordering process.
Dickey was joined on the panel by Scott Gladstone, vice president of strategy and development at Applebee's and Nicole West, vice president of digital strategy and product at Chipotle.
Where AI is coming into play with fast casuals
West shared how Chipotle is fast replacing paper tools with digital tools and driving faster and more efficient operations with AI.
"The technology automation is not only making business more efficient, but the team also loves it and it's simple to use," she said.
"AI's role is a piece of the overall [technology] journey," she added, noting Chipotle took an intentional step back to ensure that it knew where it wanted to be and to use AI to boost its agility.
"You can [with AI] pick and choose the right thing you want to explore and then weave it in," she said, adding AI is helping Chipotle drive a more personalized engagement with the customer, beyond the order interaction.
Applebee's is laying an AI platform on top of its data lake, with a focus on getting a deep view on guest interactions and attaining as much business operations insight to boost efficiency, shared Gladstone.
Improving operations efficiency, explained Bigari, is crucial for fast casuals as the industry is being challenged by a very low unemployment rate, which is making it tougher than ever to hire and retain team members.
"There is a need for a model for efficiency, on the prep side, on the ordering side, to take lower-value activities out of team members' hands," he said. Yet, he stressed, it's "not cost reduction, it's efficiency."
And that doesn't mean AI is eliminating jobs, Dickey said.
"We're adding more job opportunities," she said, noting new roles are needed in other units, such as development and support.
Implementing AI, and achieving a strong ROI, said Gladstone, requires having an end state in mind before technology deployment.
"There is a tendency to say 'let's do it' and see how the new thing works out. But with AI you need to think of how it plugs into the customer experience and your strategy," he advised.
Panel speakers also recommended that brands take an incremental strategy and use AI in small chunks and to not be afraid of slowing down if needed.
"Focus on the pain point, then look for a solution," said Gladstone.