How Chatbots are changing the way Restaurants serve their Customers

If you chanced up on my previous article Why Restaurants and Cafes need Mobile Apps — Or Do They?, you’d be aware of the dilemma restaurant and cafe owners face when it comes to mobile strategy. The hope to engage customers through a branded app and increase orders has been a distant dream. Yet on the other hand more and more time is being spent on mobile devices primed by apps. Of these social and messaging apps grab the lion’s share of the time spent.

Keen technology observers will vouch for the new sun that has dawned on the horizon of technology. Artificial Intelligence (A.I.), a term coined in 1955 by computer scientist John McCarthy has started shining more brightly in the recent years. A.I. is significantly changing the way businesses interact with their customers. With each passing day machines collect more data and make smarter decisions for humans. Almost all industries one can think of stand to benefit from A.I. in ways unprecedented.

Being an early adopter of new technologies, KLM introduced a Chatbot service last year that uses Facebook Messenger app to send customers booking confirmations, check-in notifications, boarding passes, flight status updates and answer questions. The whole idea is to enhance the customer journey whilst maintaining a human touch. The service became an instant hit among its customers who valued the Chatbot’s time saving and convenience aspects.

Chatbots are software programs, which can include A.I. components, designed to interact with people over messaging apps such as SMS, Facebook Messenger, Twitter Direct Message, Slack, Kik, Telegram and WeChat. In effect, chatbots are like live chat boxes you see on many consumer-facing websites, in the sense that they’re live in real-time, just not with a live person.

The rise of A.I. chatbot messaging between consumer and brands kicked into high gear in 2016 in the fashion, food, entertainment, media, and retail sectors. In April 2016, Taco Bell launched TacoBot on the Slack messaging platform, and Fandango and CNN unveiled chat channels on Facebook Messenger. Ever since the advent of this new technology there has been no looking back. Machine Learning is bringing further enhancements to the technology by making it smarter with every passing day. These tectonic shifts provide a significant opportunity for hotels and restaurants to harness the potential of chatbots and improve business.

One of our own mobile cafe customers, Nitro Cafe in LA leveraged Chatbot technology to reach out to more customers, improve engagement and boost orders by 20%. Facebook Messenger is being used by close to 30% of Americans, which is why a Messenger based chatbot made more sense than creating a mobile app from scratch. The cafe owner Tyler being a one-man show found it difficult to catch customers at the right time, missed them often and started losing business to local coffee shops. The chatbot that is linked to Nitro Cafe’s Facebook Business page made it easy for Tyler to reach out to customers after a quick announcement through a Facebook post and QR codes printed on the menu. The chatbot provided Tyler with a 2-way real time communication tool. He now informed customers in advance of his schedule, new drinks and offers. As more orders poured in Tyler started incentivising the regular customers with HeyMojo coupons. Messenger’s native ‘share button’ further eased out customer acquisition as existing customers opted-in their friends and colleagues who received a discount on their first order. You can read more here about how Nitro Cafe used Chatbots to increase orders.

Consider the advantages that chatbots bring:

1. Lower cost of ownership compared to mobile apps
2. Better outreach than mobile apps
3. 2-way customer engagement
4. Personalised customer experiences
5. Sharing features reduce customer-acquisition-cost

Chatbots are an effective new medium to engage customers for marketing and service given that most of the restaurants already have presence on Facebook. The potential of the Facebook community (page traffic including likes, visitor and followers) when leveraged can help businesses establish a direct connection with their customers and also reduce 3rd party commissions. The oft repeated axiom ‘Direct is the best’ may just have found a new leash of life in Chatbots.