03 October 2016

AI robots – dawn of a new era in service industry

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Hong Kong Economic Times IMS Team

As aging populations become a prominent trend and the technology of AI robots advances by the day, AI robots are expected to make further strides into the service industry

"Hello, my name is Pepper, what would you like for lunch today?"


In the not-too-distant future, instead of the welcoming voices of waiters, the first thing that greets you when you walk into a restaurant may be Pepper, the artificial intelligence (AI) robot that can recognise human emotions. If you cannot decide which dish to try, Pepper is able to make suggestions by asking your preferences. Since its unveiling by Softbank last year, the friendly robot has been an instant hit; the company released 1,000 Pepper robots to the market each month, and for seven consecutive months the robots sold out within one minute. Now, MasterCard is cooperating with Pizza Hut to take Pepper’s fame one step further – the two companies are planning to employ Pepper robots as waiters in every Pizza Hut outlet throughout Asia before the end of the year.

While Pepper is making a grand entrance in the catering industry, this is just the robot’s first step. As aging populations become a prominent trend and the technology of AI robots advances by the day, AI robots similar to Pepper are expected to make further strides into the service industry.

From ordering food to paying bills – a one-stop solution

"Consumers are demanding more personalised services, tailor-made products and smoother user experiences. This is where Pepper comes in – it can shape a memorable personalised consumer experience for customers. The Pepper robots implanted with AI are vastly different from the automated machines you see today", says Tobias Puehse, Vice President, Innovation Management, Digital Payments and Labs Asia-Pacific at MasterCard. Puehse also leads the Pepper project.

When Pepper navigates its environment, it can move around by detecting its surroundings via sonar, infrared and laser sensors. At the heart of Pepper’s intelligence is the ‘emotion recognition’ function that enables it to read emotions by observing the speaker’s facial expression and tone of voice. As Pepper can tell the difference between joy and sorrow when it interacts with customers, it literally breathes life into robotic customer service with an impressive human touch.

"You can log in to your own Masterpass account by simply inputting data into Pepper’s tablet or by using the QR code scanner in your mobile phone to scan the QR code on the tablet”, says Puehse. “Then, Pepper can provide a personalised food ordering service that suits your preference".

The programme has been rolled out by Masterpass, an electronic payment platform under MasterCard, and will be launched at Pizza Hut. The technology can link to customers’ Masterpass electronic wallets through secured Wi-Fi networks, so that the whole ordering and billing process runs smoothly. If customers want more information, such as the number of calories in each food item and the latest offers, just ask Pepper and it will fetch them for you. The robot can even make dish recommendations that suit your tastes. "In the future, wherever Pepper is present, you will find personalised consumer services provided by robots everywhere you look; retail outlets, hotels, banks, airports and so on", Puehse says.

Aging population fuelling demand

In fact, the use of robots is nothing new, and different models have been introduced in the past. However, with the rise of AI, robotic technology has been infused with a new element; AI robots are born with a ‘heart’ that can recognise human emotions and a ‘brain’ that can make judgements under various circumstances. The monotonous robots that were used in industrial assembly lines and only knew how to follow orders have been given a facelift – they are now equipped with the groundbreaking ability to evaluate. Today, robots can step out of the manufacturing sector and find their place in other industries, meaning wider robotic applications going forward.

The world is facing great challenges of an aging population and labour shortage. AI robots can help alleviate these imminent problems. According to a global human resources report compiled by human resource company ManpowerGroup, Japan ranked highest in the world in terms of the degree of difficulty in hiring – in 2015, 83 per cent of the Japanese employers surveyed said that hiring is difficult, followed by Peru and Hong Kong where 68 per cent and 65 per cent of employers, respectively, said they face the same challenge. Therefore, governments in different countries are looking to promote the use of robots to mitigate the negative economic impacts caused by labour shortages. The International Federation of Robotics (IFR) anticipates that the number of AI robots will surpass 15 million by 2020, representing a USD1.5 trillion business.

Due to the labour shortage in Japan, and given the fact that Pepper is the world’s first ‘emotional robot’, its debut in Japan last year was a huge success, especially among employers in the service sector. With Pepper, the Japanese telecommunications firm NTT DoCoMo introduced unstaffed stores where only Pepper robots are available to serve customers. The footprints of Pepper are everywhere in the streets of Tokyo; the PARCO department store in Ikebukuro ‘hired’ Pepper as the store manager to lead a one-day promotion campaign; in front of the Famima coffee shop in the Shiodome Subway Station, Pepper sings and dances to entertain passers-by; and in the Tsutaya Electrics store in Futako Tamagawa, Pepper plays interactive games with kids.

Besides retail stores, hospitals and kindergartens in Japan are embracing Pepper too. In paediatric clinics, you will find Pepper robots dressed as nurses making appointments for kids, while in kindergartens, Pepper robots even turn themselves into ‘stupid students’ that are taught English vocabulary by the real students. Since Pepper robots are ‘poor learners’, little kids have to repeat the vocabulary time after time. In the process, the new knowledge is reinforced in the children’s memories. AI robots can help mitigate the problems of an aging population too; they are expected to take up a larger role as caregivers in the future.

© 2016 Hong Kong Economic Times. All rights reserved.

The information, findings, projections, representations, opinions or comments in this article (the "Content") are those of Hong Kong Economic Times IMS Team and they do not constitute any form of opinion, advice, recommendation, representation or endorsement of The Hongkong and Shanghai Banking Corporation Limited (the "Bank").

The Bank makes no representation or warranty (express or implied) of any nature and accepts no liability or responsibility with respect to the Content and any inaccuracy or omission in it.

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