Automation in restaurants and retail: How does it affect the customer experience?

Published on 19/03/2024 by Andrew Blair

Retailers have already automated many aspects of the shopping and dining experience. We asked 300 consumers in Australia what they think about it.

A customer using automated technology in retail

Advances in technology have made it possible for small to midsize enterprises (SMEs) to automate various aspects of their business. This is especially true for the retail and food-service sectors, where SMEs make up a significant proportion of the market in the form of independent cafes, restaurants, and shops.

Some of these tech innovations, like self-checkouts or online food ordering have been widely adopted and allow businesses to save money while providing a faster or more convenient service to customers. They also allow SMEs to compete —at least to some degree— with bigger players like supermarkets or franchised restaurant chains.

In this article, we explore data from a survey of over 300 consumers in Australia who have experience with automation technologies at retail businesses or restaurants. We asked about the automation technology they have used, the benefits they expect, and how systems like automated point-of-sale (POS) systems affect the customer experience when shopping and dining. You can scroll down to the bottom of this article for a full methodology.

The in-person experience is still important in an online world

Automating processes, whether in a store or a restaurant, is a highly relevant trend for SMEs today. Although it’s easy to order food and buy goods online, the respondents in our survey do these activities in person far more often. For example:

  • 60% said they visit a grocery store more than once a week
  • 54% go to a retail store once a week or more
  • 77% eat out at least once a month

By comparison:

  • Most (54%) order online groceries less than once a month
  • 34% order retail items online each week
  • 41% order food online at least once a month

Brands should therefore pay at least as much attention to the on-site customer experience as they do to their website or app experience. And by far the best way to do this is to focus on convenience and speed. When asked how the in-person experience could be improved, these factors stood head and shoulders above all others.

Bar graph showing what factors would improve in-person shopping experiences

Consumers also see them as significant areas that could be improved through automation. They cited convenience (highlighted by 75%) and speed (67%) as the most important benefits of automation— more than twice as popular as the next biggest area: privacy (32%).

When asked where they find it acceptable for businesses to use automation technology instead of humans, they again focused on factors that make the experience more streamlined: checkout (74%) and finding items in store (57%).

Key takeaway: A friction-free experience is top of the list for customers when shopping or eating out. They prioritise finding the things they want and paying for them quickly. In the following sections, we look at how the right point-of-sale systems, including self-checkout, can make the final in-store interaction as smooth as possible.

Consumers are happy with automation experiences so far

The people in our survey are already familiar with at least some automation technologies and keen to keep using them. For example:

  • 94% have used contactless payments and would do so again
  • 92% have used self-checkout and would do so again
  • 64% have used click and collect (where shoppers buy online and then pick the items up in person) and would do so again

Other technologies have not caught on to such a degree, but early interest is there:

  • 44% would like to try cashierless checkouts, where shoppers can scan items as they go and don’t need to go through a final checkout. 33% have already tried (and liked) it.
  • 44% are interested in augmented reality, like smartphone filters for clothing, cosmetics, or furniture. But only 15% have tried and liked it so far, and 30% say they have no interest. 

In the majority of cases, people found these automation technologies to be fairly easy-to-use. Some, like contactless payments and self-checkout, are commonplace, but significant proportions said they still encountered difficulties. For example, nearly four in ten people who use self-checkouts said they had issues or delays the last time they used one.

Stacked bar chart showing issues experienced with retail technologies.
Key takeaway: Adoption of automation in retail and restaurants is widespread, and there is interest among consumers in some emerging technologies, too. While many SMEs will be familiar with software like contactless payment solutions, they should investigate how augmented reality (and virtual reality) might begin to change the shopping experience. Check out our guide to how SMEs can make the most of AR and VR for more information.

Self-checkouts are a common sight in Australian stores and restaurants —the first ones were installed in 2007— so shoppers are largely comfortable with them. Among the 93% of survey respondents who feel positive about them, 98% said they would be likely to use them for groceries, 49% for other retail stores, and 34% for quick-service restaurants.

Nearly two-thirds (65%) of those who had used self-checkouts said they had had good or excellent experiences with the technology overall. But, as highlighted above, many face issues, and some hurdles remain:

Bar chart showing the most common challenges when using self-checkout

That said, a clear majority (72%) thought that the self-checkout experience has improved over the past five years, and even more (76%) thought that the machines add efficiency to their in-person shopping experience. A majority (72%) said that they foresee using self-checkout more in the future.

Key takeaway: Although there are reports that some larger retailers are reducing their numbers of self-checkouts, consumers seem to like them and want to use them more. While self-checkouts are mainly restricted to larger stores and chains, SMEs can still learn from the effect they have: shoppers like them because they meet their needs of speed and convenience.

There’s room for automation in restaurants, but the human touch is vital

People value customer service much more when they’re dining compared to when they’re shopping. Almost half (43%) said customer service is somewhat important in a grocery or retail context, with 30% saying it was very important. But these numbers switched to 28% and 66% respectively when thinking about restaurants.

Just as in retail, respondents’ feelings about the experience they expect in the food service sector is starkly split depending on the type of business. On one hand, 84% said they prefer to take their time and enjoy the experience when eating at a table-service establishment, whereas 91% said they prefer to get in and out as quickly as possible when getting food from a self-service restaurant.

However, that’s not to say that diners don’t see a role for automation in table-service restaurants. In total, 54% thought that automation technology is acceptable for  ordering (through a QR code or app) from their table, and 52% thought it could be used for checkout in these establishments.

Broadly speaking, respondents thought that automation was overall more suited to self-service. When it comes to actual food preparation however, they tended to think that was best left to human chefs.

Stacked bar chart showing acceptable tasks for the use of automated technology instead of human employees

Finally, artificial intelligence may be the hottest trend in tech right now, but diners aren’t sure if it has a place in food service. Just over half (51%) said they would be unlikely to order food through an AI tool (like a chatbot), while the rest felt they would be likely.

Key takeaway: There is plenty of consumer demand for automation in restaurants —both in quick-service and table-service establishments. SMEs that are considering this should be mindful that diners appreciate good customer service as well as efficiency, and there are some areas of the business where they expect a human to be in control. If you’re interested in exploring the possibilities, many of today’s restaurant management software includes features for automation across the business from front-of-house to accounts and reporting.

Automating the customer experience in 2024

Because in-person shopping and dining is still so common, SMEs in retail and hospitality should look to make the experience as convenient and frictionless as possible. Customers are generally happy for automation technology to play a role in this, and seem to be comfortable with self-checkout, contactless payments, and click-and-collect, among other methods.

Brands that want to improve the customer experience through automation should be aware that customers still value the human touch, especially when it comes to food preparation, and that automation in itself is only valuable in service of the needs of the customer— not as a goal in itself.

Looking for point-of-sale software? Check out our catalogue.


Methodology: 

Software Advice's 2024 Retail Automation Survey was conducted online in February 2024 among 302 respondents in Australia. The goal of the study was to learn how retailers and restaurants can address customer pain points with automation to ensure technology is adding efficiency to the customer experience. Respondents were screened for their experience with automation technologies at retail businesses and restaurants.

This article may refer to products, programs or services that are not available in your country, or that may be restricted under the laws or regulations of your country. We suggest that you consult the software provider directly for information regarding product availability and compliance with local laws.

About the author

Andrew is a Content Analyst for Software Advice, giving SMEs insights into tech, software and business trends. Interest in entrepreneurship, furthering projects and startups.

Andrew is a Content Analyst for Software Advice, giving SMEs insights into tech, software and business trends. Interest in entrepreneurship, furthering projects and startups.