Nearly three years after McDonald’s announced its partnership with IBM to develop an artificial intelligence-powered drive-thru order-taking system, videos have emerged on social media showing confused and frustrated customers trying to comically fix meals inaccurate.
“Stop! Stop! Stop!” two friends screamed in humorous anguish on a TikTok video as an AI drive-thru misunderstands their order, totaling 240, 250 and then 260 Chicken McNuggets.
In other videos, the AI calls a customer for nine iced teas instead of one, fails to explain why one customer couldn’t order Mountain Dew, and thought another wanted to add bacon to their ice cream.
So when McDonald’s announced in a June 13 internal email, obtained by trade publication Restaurant Business, that it was ending its partnership with IBM and halting its AI testing in more than 100 drive-thrus- In the United States, customers who had interacted with the service were probably not shocked.
The decision to abandon the IBM deal comes as many other companies, including its competitors, are investing in AI. But it illustrates some of the challenges businesses face as they strive to unlock the potential of this revolutionary technology.
Other fast food companies have found success with AI ordering. Last year, Wendy’s formed a partnership with Google Cloud to develop its AI drive-thru system. Carl’s Jr. and Taco John’s have hired Presto, a voice AI company for restaurants. Panda Express has about 30 automated order takers at its windows thanks to a partnership with voice AI company SoundHound AI.
Another SoundHound partner, White Castle, has AI assistants taking orders at 15 drive-ins and plans to deploy 100 more, spokespeople for both companies said. The technology processes nearly 90% of orders without human intervention, works efficiently with staff and reduces wait times for customers during peak hours, said Jamie Richardson, vice president of White Castle.
“It’s great for customers; it’s also great for the team members,” he told the New York Times. “I can’t speculate on why others wouldn’t invest in similar technology, but we are very happy with ours.”
Keyvan Mohajer, chief executive and co-founder of SoundHound, believes McDonald’s departure is simply an example of a failed partnership.
“It was very clear that they were abandoning IBM, they were not abandoning voice AI,” he said. “They are looking for other suppliers very quickly.”
McDonald’s confirmed plans to eventually return to the technology, writing in the internal email that “a voice ordering solution” would be in the chain’s future.
In a statement, IBM said it looked forward to continuing to work with McDonald’s, adding that it was “in discussions and pilot stages” with several restaurants interested in developing their automated ordering technology. McDonald’s confirmed to the Times the end of its AI drive-thru, but neither company would answer more specific questions.
Many researchers and industry experts see McDonald’s exit as an example of how new technology is not yet meeting expectations. They doubted the company would quickly return to testing AI controls in its drive-thrus.
“AI systems often have a very high initial cost,” said Neil Thompson, director of FutureTech, a research project at MIT’s Computer Science and Artificial Intelligence Laboratory. (FutureTech worked with IBM, but Mr. Thompson said he had no in-depth knowledge of the McDonald’s deal.)
Currently, voice AI is imprecise enough to require some level of human oversight, reducing cost savings, Thompson said. And McDonald’s has a solid alternative offering with higher profit margins: its mobile app.
“The app saves 100% of the work required to take an order, which these AI systems, at least currently, are not able to do for them,” Thompson said. “This makes using the app much more economically attractive than using AI. »
McDonald’s hasn’t abandoned all its investments in AI. In December 2023, the company announced that it was working with Google Cloud. A spokesperson for the tech giant said this would be applied to “commercial use cases”, declining to be more specific.
Alex Imas, a professor of behavioral sciences and economics at the University of Chicago, predicted that McDonald’s would watch from the sidelines while its competitors explored the technology.
McDonald’s business model does not rely on saving on the cost of a few workers behind the wheel, Mr. Imas said. “I think they’ll want to wait and make sure this thing is ready for commercial use.”
He expects McDonald’s to use AI in other ways, perhaps following the lead of Target, which recently announced it was using the technology to help its employees.
Gee Lefevre, interim CEO of Presto, acknowledged that the technology is very new: “less than 0.5% of all drive-ins in the United States” are testing the use of AI to take voice orders , did he declare.
But he also noted that many early attempts have been successful.
Wendy’s, in an email to The Times, said its AI drive-thrus operate without human assistance on 86% of orders. And Presto got about a 90 percent rate with most of its customers, Mr. Lefevre said.
He thinks McDonald’s struggled because it used the wrong type of AI
“The IBM model was still based on natural language understanding,” Lefevre said, explaining that the model works like a tree. When the AI hears the customer’s command, it has a limited number of branches to follow that dictate its responses and actions.
It works very well when everything is going well, Mr. Lefèvre said. But in a drive-thru, where indecisive customers frequently change their orders, he said, chains would be better off using the kind of big-language model that powers chatbots like ChatGPT.
As companies continue to test their AI technologies while driving, expect to see more videos of people getting bacon ice cream, condiments instead of food, or enough nuggets to feed a sports team.
But ask Mr. Mohajer where voice AI is going and he’ll tell you why SoundHound has partnered with automakers like Kia and Jeep.
Imagine this.
You’re driving home from work when suddenly the car asks you: “Are you hungry?”
After a few minutes of chatting with your vehicle, you opt for a burger, fries and a shake. The car finds the nearest greasy spoon, places your order for you and gives directions. In three minutes you arrive and it’s dinner, sitting patiently in a pickup line, waiting for your arrival.