This Week in Hospitality Artificial Intelligence

Some hotel brands, OTAs and technology suppliers are moving at break-neck speed to introduce new AI-driven functionality, others are taking a more wait-and-see approach.
This Week in Hospitality Artificial Intelligence

There’s no doubt that the hospitality industry – long constrained by fragmented ownership, manual operations, and disparate technology – is poised to reap substantial benefits from the integration of Artificial Intelligence. By automating manual processes such as room assignments, accounting reconciliation, and forecasting, AI can significantly enhance operational efficiency and reduce costs. Furthermore, on the guest-facing side, AI will revolutionize the management of guest data, facilitating personalized experiences that drive guest satisfaction. 

The 2024 State of Hotel Guest Technology Report by Hotel Tech Report, surveying 400 hotel guests, provides insights into AI's impact on guest experiences: 

  • 70% of guests find chatbots useful for simple inquiries but prefer human interaction for complex requests.
  • Guests primarily use chatbots for tasks like obtaining the Wi-Fi password, scheduling wake-up calls, and checking facility hours. 
  • 58% believe AI enhances their booking and stay experiences. 
  • 65% desire hotel technology that surpasses what they have at home. 

These trends indicate a growing expectation for seamless, tech-driven services in hospitality. Hoteliers who effectively implement AI tools will stand out and be better prepared for a future of exceptional service and operational efficiency.  

Varying AI Strategies in Hospitality 

Some hotel brands, OTAs and technology suppliers are moving at break-neck speed to introduce new AI-driven functionality. Others are taking a more wait-and-see approach. The smartest strategy may be a hybrid: preparing the framework and the building blocks now for the transformational technology that is coming soon. 

“We’re pretty far down the path of companies both embracing traditional AI and experimenting with generative AI. Very few of the airlines, hotels, cruise lines, and suppliers that I’ve interacted with are not already embracing deployment and actively experimenting with advanced tech,” Alex Cosmas, partner at McKinsey, said recently. “But there is risk. More is not always better. Faster is not always better. I like to say it, ‘It doesn’t matter if you got the answer right if you got the delivery wrong.’” 

Mews CEO Matt Welle suggests hoteliers add AI to their priority list but keep it below some other more pressing technology initiatives. In a PhocusWire recap of the Mews Unfold event, he said:  

“I don't think we're at a stage where AI is going to solve all the problems we already have. I think if they just upgraded to the cloud — I can’t believe we’re still talking about the cloud being innovation; unfortunately for our industry, it still is — and embrace the automation that exists. AI is for that last 10%, but if we’re still at 50%, let’s just get to the 90% through the tools that already exist." 

Today’s AI Capabilities 

Before jumping the gun and deploying new tools that could quickly be outdated, it’s imperative for hotels to research the most practical applications for AI in their businesses. In Hospitality Upgrade, hotel tech expert Doug Rice summarized “Practical Applications for AI in Hotels.” The highlights: 

  • Marketing. Generative AI can draft descriptions for properties, room types, restaurants, facilities, packages, etc. It can auto-generate responses to guest communications and reviews.  
  • Revenue Strategy. Revenue management systems use machine learning to adjust rates based on predicted supply and demand and other demand indicators.  
  • Accounting and Finance. AI brings an improved ability to ingest and extract data from paper documents, and then automate processes like invoice approval, OTA and bank reconciliation, and income journaling. 
  • Guest Communications. Chatbots can answer most guest questions a front desk or call center operator would normally get within one or two clicks for a guest. 
  • Business Intelligence. Instead of serving up descriptive analytics, AI can decipher and analyze relevant information and either serve up a recommended action or automatically take the next steps. 

Marriott Talks AI Plans 

Hotel brand behemoth Marriott recently pulled back the curtain to shed some light on their AI strategy. Speaking at the Skift Data + AI Summit, Drew Pinto, EVP and chief revenue and technology officer, said Marriott is looking to tap into generative AI to create personalized experiences similar to a Build-A-Bear or Mr. Potato Head interaction. 

“The biggest challenge for us has been scaling, so everything from security and privacy to the infrastructure, these large language models are super expensive,” Pinto said. “It’s been hard for us to get it out at scale, to figure out how you can make the business case work.” 

Marriott is also exploring how AI will impact operational efficiency. 

“We want to automate a lot of those manual tasks that happen at the front desk today, so that they can spend more time with the guests. And it’s a really great example that we’re building of how you use automation and tech to help assist or augment somebody’s job,” Pinto said. 

A Focus on AI at HITEC 

Perhaps the most pivotal event of the year for hotel technology professionals, the 2024 Hospitality Industry Technology Investment Conference (HITEC) is set for June 24-27 in Charlotte. Undoubtedly, most of the talk in the sessions, hallways and on the tradeshow floor will be centered around Artificial Intelligence. Hoteliers are eager to learn how it’s likely to positively disrupt their businesses now and in the future, and suppliers are eager to show off the ways AI has improved their offerings. 

 Scot Campbell, principle at Integrated Resort Advisors and member of the HITEC Advisory council, said a pre-event survey highlighted the importance of weaving AI into many of the educational sessions at the event. 

“At least 60% of what was submitted from folks has something to do with AI because it's such a new technology that is emerging and everybody wants to find out how to use it,” he said. 

Book a meeting at Otelier booth #1036 during HITEC to learn how AI will provide operational efficiencies and unparalleled actionable insights into your data. 

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