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 - Just
how much of the global service industry will be left standing by the time
COVID-19 is brought under control is anybody’s guess. In the U.S., an industry
association says restaurants across the country are on track to lose US$240 billion in
revenues by the year-end. Most hotels stand empty. But rest assured that all is
not 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 from
COVID-19.

 

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

 

“Our results show that with the
pandemic dominating people’s awareness, service robots could signal low
interpersonal contact, reduce the perceived risk of virus transmission, and in
turn increase visit intention,” says study author Lisa Wan, Associate
Professor at the School of Hotel and Tourism Management and Department of
Marketing at CUHK Business School.

 

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

 

Saving Humans from the Apocalypse?

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

 

For example, a subsidiary of Chinese
property developer Country Garden opened the world’s first restaurant complex in Shunde, Guangdong province, in
June, completely staffed and operated by robotics. The facility, which can
accommodate 600 customers, is equipped with 20 robots that can cook over 200
dishes ranging from Chinese food, hotpot and fast food. The food is said to be
available within just 20 seconds of ordering. When ready, the food is delivered
directly 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 other
foods. In Russia, KFC has opened a store that uses a fully automated fried
chicken preparation system.

 

In a hotels setting, robots are
being put into applications including front
desk operations, concierge and room delivery.

 

While the technology to build at
least rudimentary robots in service sector settings has existed for some years
now, 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 to
breaking down often, they were also — to use a clinical term —
“useless”.

 

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

 

Meanwhile, Chinese restaurant chain
Heweilai, an early catering robotics use pioneer, told Worker’s Daily in 2016 that it was
forced to stop using a fleet of robots it purchased to serve customers because
of their limited capabilities. Their robotic waiters had trouble carrying
something as simple as soup, kept crashing into each other because they could
only 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 with
customers.

 

“Ironically, in face of a
pandemic, it is exactly the lack of interpersonal touch characterised by
service robots which makes potential customers perceive a lower risk of
contracting viruses and in turn, increase their intention to visit,” Prof.
Wan, who is also Director for the school’s Centre for Hospitality and Real
Estate Research, comments. “Businesses, especially for the hard-hit
tourism industry, need to prepare for pandemics as a constant in the business
environment. The research suggests that service robots could be a long-term
solution and sheds new light on the robot-customer dynamic specific to the
tourism industry.”

 

Consumer Reaction to Robots

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

 

In the second study, the researchers
recruited American and Chinese respondents via two online platforms. A total of
1,062 respondents took part in the survey. The questions were identical to the
first study with an added hotel scenario. Again, the results show that the
respondents would visit both restaurants and hotels due to reduced
interpersonal interaction via the use of robots. Interestingly, Chinese
respondents indicated higher intention to visit hotels and restaurants when
robots are used than American respondents. According to the results, the
Chinese respondents also believed to a greater extent that reduced
interpersonal interaction due to robots would effectively reduce the risk of
viral infection.

 

“Tangential to the core
predictions, our findings suggest that the use of service robots to reduce
perceived risk of virus transmission and encourage visits could be more salient
in collectivistic cultures such as China,” Prof. Wan comments. “This
could be attributed to more reliance on interpersonal cues in decision-making
for collectivists. Future research may explore the cultural impacts which will
have significant theoretical and practical implications for the successful
infusion of service robots in the tourism industry across cultures.”

 

In addition, Prof. Wan says more
research on intelligent automation and how consumers perceive and react to
service robots in the tourism industry is needed. While governments and health
authorities are devising reopening plans that centre around public health and
businesses establishing stricter guideline for operations, Prof. Wan emphasises
that the measures may not adequately soothe pandemic-stricken consumers.

 

“Every effort to ensure a safe
and fast recovery is imperative to revive the tourism industry,” Prof. Wan
says. “This research proposes and tests how the psychological impacts from
a prolonged (and possibly recurring) period of social distancing may play a
role in business recovery, especially that in the tourism sector. We believe
that this psychological perspective complements the mainstream focus on health
and economic measures to combat COVID-19 and similar pandemics which may come
to pass.”

 

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

 

About CUHK Business School

CUHK
Business School comprises two schools — Accountancy and Hotel and
Tourism Management — and four departments — Decision Sciences and
Managerial Economics, Finance, Management and Marketing. Established
in Hong Kong in 1963, it is the first business school to offer BBA, MBA and
Executive MBA programmes in the region. Today, the School
offers 10 undergraduate programmes and 18
graduate programmes including MBA, EMBA,
Master, MSc, MPhil and Ph.D.

 

In
the Financial Times Global MBA Ranking 2020,
CUHK MBA is ranked 50^th. In FT‘s 2019 EMBA ranking, CUHK EMBA is ranked 24^th
in 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 key
business leaders. The School currently has about 4,800
undergraduate and postgraduate students and Professor Lin Zhou
is the Dean of CUHK Business School.

 

More information is
available at http://www.bschool.cuhk.edu.hk or by connecting with CUHK Business School
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