AI- and Employee-Based Customer Services in Restaurants: Customer Engagement Leading to Loyalty During the Covid-19 Pandemic

Abstract

This study aims to examine the extent to which customers’ perceptions of AI and employee services evaluations, influence their engagement with restaurant service delivery, which in turn drives customer loyalty during the COVID-19 pandemic. Data were gathered from 527 respondents via an onsite survey from restaurants providing both AI and human staff services. A partial least squares structural equation modelling (PLS-SEM) technique was used to formulate hypotheses and develop the model. The results of this study contrast with previous research which states that customers tend to appreciate AI services rather than human staff. The AI-based service performance value and trust in the AI-based service and system had a strong effect on customer engagement, whereas employee-based service support significantly explained substantial variance in customer engagement. Interestingly, customer engagement with AI-based services had a negative impact on loyalty. While customer engagement with employee-based services had a positive impact, this impact was not significant with regard to loyalty. One possible explanation for this result is that restaurant businesses preferred to use AI-based services that replaced human-based services in order to provide contactless options during the COVID-19 outbreak. Additionally, restaurant image positively moderates the link between service evaluation and customer engagement with AI service and negatively moderates the effects of service evaluation on customer engagement with employee services.