How generative AI changes the quick service restaurant industry

Every industry, including the quick service restaurant (QSR) market, plans to transform its business with artificial intelligence (AI), especially generative AI. Several years ago, Wendy’s embarked on its AI journey, leveraging cloud computing services and generative AI to enhance employee and customer experiences. The drive-thru experience presents numerous challenges for QSR restaurants due to the complexities of menu options, limited-time offers, special requests, and ambient noise.

Wendy’s chose to tackle the drive-thru experience with AI because 75 to 80 percent of Wendy’s customers choose the drive-thru as their preferred ordering channel. The company saw a tremendous opportunity to improve the customer experience by creating a seamless ordering experience using AI automation in the drive-thru.

In an interview with Maribel Lopez of Lopez Research, Wendy’s CIO Matt Spessard shared how its AI program had advanced over the past year and shared advice for other leaders looking to tackle AI within their business.

Wendy’s AI Strategy

In 2024, Wendy’s announced an expansion of its partnership with Google Cloud, tapping into Google’s AI technology and resources to enhance its generative AI platform called Wendy’s FreshAI. Wendy’s FreshAI aims to address challenges that traditional AI couldn’t solve, such as understanding casual conversations and handling the extensive customizations of Wendy’s menu.

Traditional rule-based AI chatbots weren’t the answer because they can’t easily support natural conversations’ diverse and dynamic nature. For example, Wendy’s realized there are over 200 billion combinations of words and options to order a Dave’s Double. Today, Wendy’s uses generative AI to interpret conversations, create responses, and adapt in real-time instead of following a narrow set of rules.

Measuring AI Success and Return

Wendy’s takes a pragmatic view of what AI success means. Its efforts focus on delivering speed, accuracy, and consistency to customers. It measures these results with metrics such as how many orders were submitted without human intervention and the consistency of the customer experience at the drive-thru.

What’s Next for AI at Wendy’s

Wendy’s FreshAI has moved from pilot to production. It is now available in nearly 100 restaurants across 17 states with Spanish language capabilities. There’s still tremendous upside to expanding the technology deployment as Wendy’s operates over 7,000 restaurants globally. Going forward, Wendy’s sees the Fresh AI assistant as a platform that will scale across various ordering channels, such as mobile apps, kiosks, and smart devices.

Advice on Tackling AI Innovation

1. Identify the right use case and technology. Wendy’s emphasizes that organizations need to think pragmatically about the use cases where AI can provide the most value and then select the appropriate AI technology (e.g., generative AI, traditional machine learning) to fit that specific need.
2. Start with small-scale experiments. Spessard recommends that companies start with small-scale experiments within the organization, exposing employees to AI capabilities. This exposure helps organically grow the usage of AI as more use cases are identified.
3. Emphasize continuous improvement. Wendy’s stressed the importance of a feedback loop, continuous iteration, and a mindset of even 1% improvement every day. It regularly analyzes customer and employee feedback, allowing Wendy’s to refine aspects like tone, cadence, and phrasing in Wendy’s FreshAI.
4. Engage stakeholders early and often. Wendy’s found it very valuable to regularly perform demonstrations of the AI assistant’s capabilities and progress to key stakeholders like franchisees. These demos helped build trust and support for the initiative as stakeholders could see the improvements over time.

A key takeaway from the discussion was to ground AI innovation in iterative improvement, continuously engage employees and partners in the process, and cultivate a willingness to experiment and learn rather than trying to perfect the technology before deployment.

Conclusion

Wendy’s AI journey demonstrates the potential of generative AI to revolutionize the quick service restaurant industry. By leveraging AI to enhance employee and customer experiences, Wendy’s has improved the drive-thru experience, reduced errors, and increased customer satisfaction. As the company continues to expand its AI capabilities, it is essential for other organizations to learn from its experiences and adapt AI to their own businesses.

Frequently Asked Questions

Q: What are the benefits of using generative AI in the QSR industry?
A: Generative AI can improve the customer experience, reduce errors, and increase efficiency in the drive-thru.

Q: What is the current state of AI deployment at Wendy’s?
A: Wendy’s has deployed its AI platform, Wendy’s FreshAI, in nearly 100 restaurants across 17 states, with plans for further expansion.

Q: What advice do you have for organizations looking to adopt AI?
A: Start with small-scale experiments, identify the right use case and technology, and continuously improve and iterate on the AI platform.