When consumers make a purchase, whether they realize it or not, two key factors often influence their decision: convenience and simplicity. In theory, Artificial Intelligence (AI) has the potential to enhance these aspects in fast-food operations more than ever before. However, just because companies can deploy AI doesn’t mean they should rush into it.
Wendy’s Dynamic Pricing Misstep
Earlier this year, Wendy’s attempted to integrate AI into the customer experience by introducing “dynamic pricing” through an AI-powered menu. Their goal was to establish a fast-food “happy hour” by temporarily lowering prices during slow business hours to attract customers. Unfortunately, this concept was not communicated effectively, leading to widespread customer backlash.
Customers misunderstood “dynamic pricing” to mean that prices would increase during peak times, akin to surge pricing models used by companies like Uber. This misunderstanding led to fears of paying more during busy periods, and who could blame them? The term “dynamic pricing” inadvertently associated Wendy’s initiative with negative pricing strategies, overshadowing their intent to save customers money.
Dynamic pricing isn’t new—gas prices fluctuate based on demand and time of year. However, without clear communication, customers filled in the gaps with their own assumptions, often expecting the worst. The result was a surge of negative feedback in the press and on social media, turning a potentially great use of AI into a public relations challenge.
McDonald’s AI Drive-Thru Experiment
Similarly, McDonald’s tested customer-facing AI by implementing AI-driven order-taking at more than 100 drive-thru locations. The premise was that if AI could handle drive-thru orders, employees could focus on preparing quality food, providing excellent in-store customer service and maintaining the restaurant. In practice, the experiment raised concerns about the cost of AI operations and whether the technology was truly ready for customer interactions.
Customer satisfaction suffered during the trials as some orders were processed incorrectly. The AI system struggled with accents and background noise, leading to mistakes that frustrated customers. Compounding the issue, the rapid advancement of AI technologies like OpenAI’s ChatGPT disrupted existing implementations, requiring companies to reassess their strategies.
Unlike Wendy’s, McDonald’s challenges appear to be more of a temporary setback. With generative AI reshaping the industry and startups developing more accurate voice-ordering technologies, there is optimism that future implementations will surpass the crucial 90% accuracy threshold. McDonald’s public pause on the project likely serves as a strategic reset rather than an abandonment of AI integration.
The Necessity of Patience and Clear Communication
These examples underscore a vital lesson: while AI holds immense potential for transforming the restaurant industry, hasty implementation without thorough planning and clear communication can lead to negative outcomes. Innovations rarely follow a straight path to success; they require patience, adaptation and a willingness to learn from early failures.
Effective communication is crucial when introducing new technologies, especially those that alter established consumer habits or impact pricing. Customers need to understand not just what changes are happening, but why they benefit from them. Presenting new technology in a way that aligns with customers’ expectations can foster a positive response and smoother adoption.
Focusing on Customer Value
Ultimately, any new technology should create clear value for the customer. If AI touches the guest experience directly, its benefits must be communicated transparently and frequently. Without understanding what’s in it for them, customers may develop negative perceptions, thinking that “AI isn’t going to work,” which can hinder future innovation.
The restaurant business remains fundamentally about great food, excellent service, and value for money. Technology should enhance these core values, not detract from them. While using AI as a novelty can generate early buzz, any gains will be short-lived if customers don’t clearly see the benefits.
Conclusion
Artificial Intelligence is poised to revolutionize the restaurant industry, but success depends on thoughtful implementation and effective communication. By taking the time to align new technologies with customer expectations and clearly conveying their benefits, restaurants can harness AI to enhance convenience and simplicity without sacrificing trust or satisfaction. Innovations need not be rushed; with patience and a focus on customer value, AI can become a seamless part of the dining experience that genuinely enriches both the business and its patrons.
Bob Vergidis serves as the chief vision officer of pointofsale.cloud and sits on the advisory board of the Interactive Customer Experience Association. He developed one of the first food mobile ordering solutions in 2000 and one of the first cloud point of sale systems. With his mobile ordering solution, Vergidis has assisted several restaurants and retail businesses adopt leading-edge technology to move their companies forward.
