Dive Brief:
- Cava, which secured $190 million in funding earlier this week, will use part of the cash infusion to diversify the restaurant's digital offerings. CEO Brett Schulman wrote in an email the chain recently began "investing in AI driven personalization across the consumer journey" and testing one-touch, near-field communication technology in store to allow diners to pay and apply loyalty more easily.
- The Mediterranean fast casual is also exploring different digital-enabled formats to modify its physical footprint amid its expansion push, Schulman said. These growth plans include converting suburban Zöes Kitchen locations as well as new builds.
- Cava plans to grow its restaurant network by over 60% in 2021 and enter several new markets, Schulman said. The restaurant plans to convert more than 50 Zöes Kitchen stores and open 14 new stores in Atlanta, a new area for the chain.
Dive Insight:
Prior to the pandemic, Cava had deployed off-premise, digital kitchens and launched mobile order drive-thru lanes, which could be a valuable leg up over slower-moving fast casual competitors. Cava's interest in digitally enhanced restaurants and personalizing digital channels with artificial intelligence comes amid a crush of major QSR and fast casual brands making similar investments.
Recent spending by players like Taco Bell, Burger King and Chipotle on developing or expanding store formats designed for digital orders reflects the industry's aim to overhaul the guest experience in anticipation of a post-pandemic future centered on convenience and online transactions.
Starbucks CEO Kevin Johnson also said on an investor call this week that the coffee chain's booming digital channel is supported by AI's growing role in company operations. The restaurant's Deep Brew AI engine personalizes offers made to diners and automates daily inventory orders across hundreds of U.S. stores.
According to an emailed statement, Cava relies on an in-house engineering team to experiment with its "next gen technologies." The chain's new cash infusion, which Bloomberg reports raises the company's valuation to around $1.3 billion, could allow Cava to grow this team and accelerate the rollout of various technology tests. Schulman did not share the specific operations it is enhancing with AI or whether this technology is developed in-house or serviced by a third-party partner.
Several legacy chains rely on outside experts to integrate AI into their business. Domino's, for example, recently teamed with Datatron to automate and standardize deployment, monitoring and management of the pizza brand's AI models. Domino's aims to grow revenue and better the diner experience by forecasting in-store labor and streamlining delivery vehicle routes through this partnership. In November, Papa John's franchisees tapped Kea to integrate Indecisive AI within its system to manage phone calls and reduce labor pressure.
Correction: In a previous version of this story, Papa John's relationship with Kea was misstated. Only Papa John's franchisees have partnered with Kea.
