It’s been a not-so-hot summer for restaurant technology.
The economy is partially to blame. Interest rates are rising and we’re staring down a recession. Investors are clamming up, and tech companies that used venture capital to grow are cutting back. Lunchbox’s marketing chief Dexter Chu put it bluntly in an email this week after the company laid off 33% of its staff: “Lunchbox had grown too quickly.”
But there have been other red flags for technology that aren’t tied directly to the economy. The latest wave of restaurant earnings reports has been full of them. Domino’s delivery sales shrank and Chipotle’s digital business slowed down, suggesting that consumers' dining behavior is normalizing. McDonald’s CEO, meanwhile, proclaimed that automation is no “silver bullet” for restaurants’ labor problems.
There’s also the growing sense that tech is hurting customer service. Too often, dining out has become an obstacle course of screens, tablets and QR codes. They’re designed to ease operators’ staffing problems, yes—but increasingly at the expense of the guest.
“It has to be a people business, not a robot business.” —Liz Moskow, food and tech advisor
The pandemic was like a hothouse for restaurant technology. The result was freakish growth—in delivery, digital ordering, loyalty, robots. As we emerge into a more normal climate, a lot of that is starting to feel like overgrowth. It’s caused some restaurants and tech suppliers to lose sight of what we’re supposed to be doing here.
“It has to be a people business, not a robot business,” said Liz Moskow, an advisor to food and tech companies. She shares my belief that in some cases, tech is hurting hospitality instead of helping it.
“As technology and pickup and these contactless situations enter the restaurant realm, there needs to be a way to add those human touchpoints of care and empathy back into the experience,” she said.
Tech’s bummer summer is an opportunity for restaurants and tech suppliers to do just that. The desperate early days of the pandemic, when tech was a virtual necessity, are long gone, and the dust is starting to settle. People are going out to restaurants again. Tech companies are charting a path for more measured growth. It’s a moment to step back and figure out what all of these bells and whistles are actually for—what makes sense in a restaurant and what’s just fluff.
For McDonald’s, at least, robots have fallen into the latter category.
“You’re not going to see robots in the restaurant,” CEO Chris Kempczinski told analysts yesterday, noting that they’re good at grabbing headlines but impractical for most operations.
“We’ve got to get after this the old-fashioned way, which is just making sure we’re a great employer and offering our crew a great experience when they come into the restaurant.”
Some pruning is in order to make sure the ecosystem can flourish to its full potential.
Every restaurant could benefit from that kind of back-to-basics thinking. Tech companies should take note of it, too. Where does technology fit in the scenario Kempczinski described, for instance? Rather than robots, the CEO of the world’s largest restaurant chain touted more mundane innovations, like data and scheduling software. On that note, it’s worth pointing out that the latest tech company to reel in a big funding round—86 Repairs—focuses on the decidedly un-splashy business of equipment maintenance.
As I’ve noted before, diners are fairly happy with the way things are now, tech-wise. In a survey of 1,000 adults last year, the National Restaurant Association found that more than 50% thought restaurants had “just the right amount of technology.” A quarter actually wanted less.
Restaurant tech has blossomed over the past two years. In many ways, it’s made restaurants better. But just like in gardening, some pruning is in order to make sure the ecosystem can flourish to its full potential.