CUHK Business School Research Finds the Use of Robotics Can Help Draw Customers Back into Restaurants and Hotels

October, 07/2020 - 09:46
CUHK Business School Research Finds the Use of Robotics Can Help Draw Customers Back into Restaurants and Hotels

HONG KONG,CHINA - Media OutReach - 8 October 2020 - Justhow much of the global service industry will be left standing by the timeCOVID-19 is brought under control is anybody's guess. In the U.S., an industryassociation says restaurants across the country are on track to lose US$240 billion inrevenues by the year-end. Most hotels stand empty. But rest assured that all isnot lost. A recent research study by The Chinese University of Hong Kong (CUHK)suggests that robots -- which are not generally known for their personal touch --may be able to help the stricken hospitality industry weather and recover fromCOVID-19.

 

The study found that the use ofrobotics in a tourism and hospitality industry setting could help to drawcustomers back into restaurants and hotels, at a time when people are concernedabout the risk of viral transmission from people-to-people interactions. Amongthe two countries studied, this was more pronounced in China than in the U.S.

 

"Our results show that with thepandemic dominating people's awareness, service robots could signal lowinterpersonal contact, reduce the perceived risk of virus transmission, and inturn increase visit intention," says study author Lisa Wan, AssociateProfessor at the School of Hotel and Tourism Management and Department ofMarketing at CUHK Business School.

 

Titled Robots Come to the Rescue:How to Reduce Perceived Risk of Infectious Disease in COVID-19 StrickenConsumers, the study was co-conducted by Prof. Elisa Chan at New York Instituteof Technology - Vancouver and Xiaoyan Luo, a PhD student at CUHK BusinessSchool.

 

Saving Humans from the Apocalypse?

For the struggling restaurantssector, the U.S. Centers for Disease Control has maintained that the risk ofgetting COVID-19 from eating out is very low. However, someoutbreaks have been linked to restaurant employees and customers. This has ledsome restaurants to increase automation in a bid to alleviate concerns.

 

For example, a subsidiary of Chineseproperty developer Country Garden opened the world's first restaurant complex in Shunde, Guangdong province, inJune, completely staffed and operated by robotics. The facility, which canaccommodate 600 customers, is equipped with 20 robots that can cook over 200dishes ranging from Chinese food, hotpot and fast food. The food is said to beavailable within just 20 seconds of ordering. When ready, the food is delivereddirectly to the customer's table by a skyrail system or on trays by robots.

 

Elsewhere in the world, the U.S.burger chain White Castle is testing"Flippy", a robotic chef arm that can cook french fries and otherfoods. In Russia, KFC has opened a store that uses a fully automated friedchicken preparation system.

 

In a hotels setting, robots arebeing put into applications including frontdesk operations, concierge and room delivery.

 

While the technology to build atleast rudimentary robots in service sector settings has existed for some yearsnow, they never really caught on (outside of a handful of gimmick applications)pre-COVID-19. Not only did they require a heavy upfront investment, prone tobreaking down often, they were also -- to use a clinical term --"useless".

 

For example, guests at therobot-augmented Henn na hotel in Japan complained thatAI room assistants mistook snoring as voice commands and would wake them upthroughout the night. Its robotic front desk was reportedly unable to answerthe most basic question and its luggage robots broke down whenever it got wetgoing outside. All this created more work for their human counterparts.

 

Meanwhile, Chinese restaurant chainHeweilai, an early catering robotics use pioneer, told Worker's Daily in 2016 that it wasforced to stop using a fleet of robots it purchased to serve customers becauseof their limited capabilities. Their robotic waiters had trouble carryingsomething as simple as soup, kept crashing into each other because they couldonly move along fixed routes, could not take orders or top up water glasses,and were both unlikely and unable to strike up a two-sided conversation withcustomers.

 

"Ironically, in face of apandemic, it is exactly the lack of interpersonal touch characterised byservice robots which makes potential customers perceive a lower risk ofcontracting viruses and in turn, increase their intention to visit," Prof.Wan, who is also Director for the school's Centre for Hospitality and RealEstate Research, comments. "Businesses, especially for the hard-hittourism industry, need to prepare for pandemics as a constant in the businessenvironment. The research suggests that service robots could be a long-termsolution and sheds new light on the robot-customer dynamic specific to thetourism industry."

 

Consumer Reaction to Robots

The research was divided into twostudies. In the first study, the researchers conducted a survey in early Aprilthat asks if the respondents would visit a restaurant if robots are used. Atotal of 496 responses were received. The results show that respondents wouldvisit a restaurant if robots are used and they also consider using robots wouldreduce interpersonal interactions, which would effectively reduce the risk ofcontracting an infectious disease.

 

In the second study, the researchersrecruited American and Chinese respondents via two online platforms. A total of1,062 respondents took part in the survey. The questions were identical to thefirst study with an added hotel scenario. Again, the results show that therespondents would visit both restaurants and hotels due to reducedinterpersonal interaction via the use of robots. Interestingly, Chineserespondents indicated higher intention to visit hotels and restaurants whenrobots are used than American respondents. According to the results, theChinese respondents also believed to a greater extent that reducedinterpersonal interaction due to robots would effectively reduce the risk ofviral infection.

 

"Tangential to the corepredictions, our findings suggest that the use of service robots to reduceperceived risk of virus transmission and encourage visits could be more salientin collectivistic cultures such as China," Prof. Wan comments. "Thiscould be attributed to more reliance on interpersonal cues in decision-makingfor collectivists. Future research may explore the cultural impacts which willhave significant theoretical and practical implications for the successfulinfusion of service robots in the tourism industry across cultures."

 

In addition, Prof. Wan says moreresearch on intelligent automation and how consumers perceive and react toservice robots in the tourism industry is needed. While governments and healthauthorities are devising reopening plans that centre around public health andbusinesses establishing stricter guideline for operations, Prof. Wan emphasisesthat the measures may not adequately soothe pandemic-stricken consumers.

 

"Every effort to ensure a safeand fast recovery is imperative to revive the tourism industry," Prof. Wansays. "This research proposes and tests how the psychological impacts froma prolonged (and possibly recurring) period of social distancing may play arole in business recovery, especially that in the tourism sector. We believethat this psychological perspective complements the mainstream focus on healthand economic measures to combat COVID-19 and similar pandemics which may cometo pass."

 

This article was first published in the ChinaBusiness Knowledge (CBK) website by CUHK Business School: https://bit.ly/3l7UglI.

 

About CUHK Business School

CUHKBusiness School comprises two schools -- Accountancy and Hotel andTourism Management -- and four departments -- Decision Sciences andManagerial Economics, Finance, Management and Marketing. Establishedin Hong Kong in 1963, it is the first business school to offer BBA, MBA andExecutive MBA programmes in the region. Today, the Schooloffers 10 undergraduate programmes and 18graduate programmes including MBA, EMBA,Master, MSc, MPhil and Ph.D.

 

Inthe Financial Times Global MBA Ranking 2020,CUHK MBA is ranked 50th. In FT's 2019 EMBA ranking, CUHK EMBA is ranked 24thin the world. CUHK Business School has the largest number of business alumni (40,000+)among universities/business schools in Hong Kong -- many of whom are keybusiness leaders. The School currently has about 4,800undergraduate and postgraduate students and Professor Lin Zhouis the Dean of CUHK Business School.

 

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