AI feels new but isn’t. 

Its foundations have been around for decades. What is new is the accessibility of tools for creating images, crafting content, and interrogating data. Today, Artificial intelligence (AI) is poised to play an increasingly pivotal role in reshaping the dining landscape and transforming the restaurant and hospitality industry.

While hospo might seem like an industry with an arms-length relationship with technology, the best operators have put it at the centre of their strategy,  propelling companies like Liven to the forefront of the restaurant tech revolution. 

Whether Kiosks, digital ordering, or a new generation of loyalty platforms - technology is already impacting revenue through average order values and visit frequency. Where many are struggling with negative comp growth, those with a technology advantage are seeing double digital comp growth.

One of AI's most significant impacts on the restaurant industry is on marketing and customer engagement. Marketing resources are often severely limited, restricting restaurants' ability to build a strong digital presence.

Enhancing Marketing and Customer Engagement

AI-powered platforms are stepping in to automate and optimise marketing efforts. Today, Liven Engage uses AI to create marketing automations, create content, and enhance personalisation and optimise engagement windows. This technology enables even small, independent restaurants to implement sophisticated marketing strategies without requiring extensive manual work or a dedicated marketing team.

Liven’s AI predictive sending feature takes send time optimisation directly to the recipient level, based on times they’ve engaged with messaging before, offering truly unique experiences for each customer.

We can expect even more personalised and targeted marketing efforts as AI evolves. Restaurants can analyse customer data to predict preferences, tailor promotions, and create highly customised dining experiences and communications that keep patrons coming back for more.

AI has revolutionised the way we approach marketing. For example, you could use ChatGPT to brainstorm ideas for your next blog or social media posts. It can also help refine your email newsletters or make your menu recommendations more engaging. Plus, AI is fantastic at learning to recognise common customer questions, offering quick and helpful responses through chatbots or support tickets.

Improving Data-Driven Insights and Decision Making

AI is also changing the way restaurants gather and utilise data. Today restaurants are plagued by data silos driven by the more than 30-plus pieces of technology they use. 

AI running across Liven One will enable restaurants to tap insights on various operational aspects, from menu pricing to staffing decisions across a myriad of opportunities, including:

• Staffing recommendations based on historical sales data paired with external factors such as events or weather

• Pricing adjustments based on inflation trends 

• Inventory management and supplier selection based on sales data

Liven uniquely integrates POS, Loyalty and interaction data in a single place - Liven Insights - enabling AI to mine insights and automate targeting. Liven AI will offer strategic guidance that typically requires a data scientist, making advanced analytics accessible to small, family-run establishments and major QSRs.

Automating Operations and Workflow Optimisation

Many of the behind-the-scenes operations in restaurants are ripe for AI-driven automation. Tasks such as employee scheduling, payroll management, and inventory tracking often require significant manual effort. AI can streamline these processes, freeing up valuable time for restaurant staff to focus on customer service and food preparation.

In the kitchen, while AI and robotics may not replace the creative flair of a skilled chef, they could assist with more routine tasks. We will see devices capable of automating basic food prep tasks like preparing eggs or chopping vegetables. 

Already, smart robotics are powering automated, highly customised production for brands like Gotcha, where bubble tea can be produced more accurately, faster, and at a lower cost - driving consistency and efficiency, particularly during busy periods.

Enhancing Customer Experience through Personalization

AI has the potential to significantly elevate the dining experience through personalisation. 

Imagine a scenario where a restaurant's AI system recognises a returning customer, recalls their dietary preferences or allergies, and suggests menu items tailored to their tastes. This level of personalised service, once the domain of only the most high-end establishments, could become commonplace with AI.

AI will also optimise real-time restaurant operations to enhance the customer experience. For instance, it could adjust staffing levels based on predicted busy periods, ensure that popular menu items are adequately stocked, or even dynamically adjust pricing to manage demand (similar to how hotels and airlines optimise their pricing).

Augmenting interactions

Further out, voice AI at tables to augment server interactions. This technology could allow diners to make simple requests, like ordering water refills or asking for a bill, without flagging down a server. While this wouldn't replace human interaction entirely, it could streamline service and improve efficiency.

Yield Optimization and Dynamic Pricing

AI will bring sophisticated yield optimisation strategies, which are common in the hotel and airline industries, to restaurants. While some restaurants already use tactics like happy hour pricing, AI could enable more data-driven approaches. For example, AI could analyse historical data, current bookings, local events, and weather forecasts to suggest optimal pricing strategies that maximise dining traffic and revenue. 

Critically, AI will enable restaurants to understand the best mix of strategies - optimising their loyalty rewards or brand dollar offers alongside pricing.

Menu Engineering and Concept Optimization

While AI might not tell a restaurant to completely change its concept (like switching from bubble tea to coffee), it can provide valuable insights for menu engineering. AI analysis can help restaurants understand which menu items are most profitable, which combinations of dishes are frequently ordered together, and how to price items optimally. This data-driven approach to menu design can significantly impact a restaurant's bottom line.

As an example, we might notice that due to recent seasonal changes in ingredient pricing, a popular menu item is being sold at a slim profit or even a loss at the moment (due to recent fluctuations in ingredient pricing). At the same time we see that ~50% of monthly returning customers had that menu item the first time they came (2.4x more than the next best menu item), and have it 80% of the times they return. So instead of removing or overhauling the item (which would be catastrophic), AI would suggest a seasonal substitute for the expensive ingredient, and then propose marketing approaches like, e.g., combo-ing that menu item with a high-margin drink or side to help drive more margin for those returning customers.

Given the breadth of Liven One data, we can display and utilise all of this when rendering the insight and suggested follow-up actions, and then obviously use AI again to automate communicating with customers across our various marketing touchpoints (in a way that's brand aligned), as well as updating orders with suppliers, and so on.

So while AI might not be useful for inspiring new menu items, it can be incredibly useful today for optimising retention while increasing visit frequency and  profitability by suggesting edits to existing concepts, and automating follow up actions.

What's Next?

Integrating AI into the restaurant industry significantly shifts how venues will operate and interact with customers. From streamlining back-office operations to creating highly personalised dining experiences, AI has the potential to be a helpful co-pilot in addressing many of the challenges facing restaurants today.

The key to success will lie in striking the right balance between technology and the human element of hospitality. The goal should be to use AI to enhance, rather than replace, the personal interactions that make dining out special.

The restaurant of the future may look quite different from what we're used to, but at its heart, it will still be about bringing people together to enjoy good food and good company – but now with a helping hand from AI assistants.