Why Newk’s Eatery is using robots to answer the phone

Its restaurants were struggling to handle the volume, so the chain turned to AI for help.
Newk's Eatery sandwich
About 10% of Newk's business comes over the phone. / Photograph: Shutterstock

For a long time now, about 1 in every 10 orders at Newk’s Eatery has come in over the phone. 

And for a long time, that wasn’t a big deal. Restaurants typically had enough staff to make one person the designated phone-answerer.

But with the industrywide labor shortage coming out of the pandemic, that seemingly simple task became more difficult to manage.

“We just didn’t have the hands to pick up those phones,” said Adam Karveller, VP of IT for the 100-unit chain. Background noise and the inability to take payment over the phone added to the challenge. Some locations stopped taking calls altogether. 

For a company that grossed an estimated $209 million in 2021, per Technomic, that volume of unmet orders could mean millions of dollars left on the table. 

So Newk’s began to explore the idea of using an AI answering system that would automatically take orders and payment, putting an end to the sound of ringing phones in its restaurants. 

The Jackson, Miss.-based fast casual is one of a number of restaurants automating their phone lines as staffs shrink and ordering channels proliferate. With sales coming at the counter, in the drive-thru and from any number of delivery apps, the old-fashioned telephone can be easy to ignore.

Newk’s first attempt to fix this didn’t go so well. The technology it was testing had a hard time learning the ins and outs of Newk’s menu, known for its Pick a Pair meal deal that has countless combinations. 

“When you look at all the different types of pairings, it makes it pretty complex when you start ordering in a natural flow,” Karveller said. Customers and employees hated it, and Newk’s realized it needed an option that allowed for some human intervention if needed.

It next came across Kea, a partner of its online ordering provider, Olo. Kea offers an automated, AI phone system that is supported by human staff who can step in if there’s a problem. It still routed calls away from the restaurant, “but we didn’t lose the business,” Karveller said.

A human will intervene 20% to 30% of the time depending on the location, a Kea representative said.

The response has been far more positive. “Folks were going up to our CEO and founder and saying, ‘I don’t know what you did with the phones, but it’s so much easier to place an order now,’” Karveller said. Staff like it too, especially when the restaurants get busy.

In addition to taking a load off employees, the new phone system has given Newk’s more insight into its customers. Because Kea always upsells, the chain can now track how often people opt in to desserts or drinks. The system also has a re-order function that asks returning phone guests if they want the same thing they got last time.

“We’ve got a number of folks re-ordering from the high-volume restaurants,” Karveller said.

About 60 Newk’s locations are currently using the system, and the chain is hopeful it can get all 100 on board.

“I was really honestly surprised that it’s been so well adopted,” Karveller said, who knows how unpleasant robotic service reps can be. “We’ve spent a lot of our time as individuals outside of the work sector talking to automated systems, and it’s absolutely atrocious.”

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