7 ways AI is shaping hospitality
Guests are using AI today
Open AI launched ChatGPT in November 2022. In March of the following year, Expedia and Kayak announced a partnership with the tool that allows guests to have conversations with the AI to help with their hotel searches. The functionality is embedded in the Expedia and Kayak platforms, which makes it easy to access for curious guests.
I am one of these curious guests. I like to test things. On the day this product was released, I tried a search with specific parameters: a luxury, dog-friendly hotel near the Netherlands coast. The results weren’t good. However, when I tried the same search again a few months later, the suggestions were significantly better.
In other words, the speed of improvement is rapid. And the time savings for guests will be huge. Rather than spend hours filtering through 200 hotel options, cross-checking facilities against each other, guests will just ask AI. It will provide the three most relevant options based on what they asked, and guests will choose one. Soon enough, this behavior will become normalized.
Reviews are more important than ever
Travelers are beginning to go directly to ChatGPT for travel recommendations. Let’s go back to my dog example: in the past, searching for a dog-friendly hotel would have relied on whatever filters and descriptions that hoteliers had set in channel managers or on their own websites. ChatGPT, however, trawls the whole web to seek this information, and there’s one key source packed with invaluable first-hand content: guest reviews.
This massively increases the value of reviews, not only through their informational content, but also their sentiment. That’s because AI tools provide results based on favorability. In my search for a pet-loving hotel, hundreds of results are filtered out, partly because there weren’t as many positive reviews for those properties. I’m only shown a handful of the best.
We know it’s true because we experience it with Mews. If you ask ChatGPT to recommend PMS software, Mews often comes out on top, and a lot of that is driven by review content on Hotel Tech Report. Of course, it probably helps that we were named Best PMS at the 2024 HotelTechAwards.
Investing in a reputation management solution should be at the top of every hotelier’s list. Generating a reliable stream of positive reviews will be as important as spending money on ads, and it will pay to get ahead of the game now.
Personalized welcomes
AI’s ability to ‘read’ and summarize can also transform the guest experience. Right now, it’s common for hoteliers to capture guest data (preferences, complaints, purchase history) in a single text field in a guest profile. That means that when the guest arrives at the hotel, the receptionist must quickly scan through a chunky block of text while the guest waits. It’s not a great welcome.
An AI tool can quickly scan the entire customer profile and provide a snappy summary. Matt has stayed here five times before, his favorite room is the Ambassador Suite, he has a feather allergy, and his dog is called Beyoncé.
This changes the welcome from ‘Have you stayed with us before?’, to a much more personal ‘Welcome back, Matt – and Beyoncé. You’ll be happy to know you’re all set up with hypoallergenic pillows...’
Chatbots keep improving
Chatbots have been an effective tool for years. But the implementation of AI into their programming is raising the bar. Most questions that guests ask to a chatbot are straightforward. What time is check-in? How much is breakfast? Over 90% of queries can be solved already.
The exciting part is that information from guest profiles can now be factored into these conversations. For instance, if a guest has not booked breakfast, the chatbot can see this and suggest the purchase, which can be automatically added to the guest’s bill. Runnr.ai is a chat app, integrated with Mews, that can already handle all of this. Full automation, no human input required.
Smart searches
At present, the search function within your PMS is fairly simple. Depending on your provider, you may be able to search for reservation numbers or guest names (in Mews, search parameters include name, email, reservation number, bill number and more). Once you’ve found the data you’re looking for, it’s then up to you to continue the journey – but the future looks different.
Instead of simply returning a search result that says, ‘Here’s a profile for Matt Welle’, this functionality will become much smarter. It will know that Matt Welle is checking in today and will suggest action points for the user, i.e. starting check-in.
Users will also be able to ask questions, engaging with search more like a chatbot. ‘Which guests are most likely to arrive within the next hour?’ can be answered by accessing flight data. ‘What upgrade would you recommend I sell to Matt Welle?’ can be answered by assessing the guest profile.
Dynamic pricing beyond bedrooms
AI has fueled dynamic pricing in revenue management for several years. But now we can say: why stop at bedrooms? Through Mews Spaces, you can dynamically price all sorts of spaces, from parking spots to meeting rooms. Breakfasts, too.
This year, Mews introduced the all-new digital breakfast list. When a guest arrives for breakfast, you can use your phone or tablet to quickly check their name, room and whether they have breakfast attached to their reservation. No more unwieldly printed lists.
Where it gets really exciting is that you can now analyze the data and see that at 9:30 a.m. on Sunday, it gets super busy in the breakfast room. Armed with this information, you can then change guest behavior to alleviate that strain. In the online check-in and check-out flows, you can recommend that guests arrive for breakfast earlier, either by informing them of typically busy times or through small incentives like a 5% discount.
Streamlined reporting
Reporting is a big area of staff inefficiency. Some revenue managers and accounting managers spend most of their day lost in their PMS, searching for answers about why the weekend saw better than expected pickup or why RevPAR has dropped.
Why not use the search box? Just as AI can give you information about specific guests, it can also digest wider trends and data and give you immediate answers, rather than creating multiple reports. This functionality isn’t available today, but given the speed that the technology is moving, it’s only a matter of time before it arrives. And when it does, this will be truly transformational.
Hotel success stories
Let’s take a quick look at AI in action across three hotels.
Hotel Oderberger, a beautiful boutique hotel in Berlin, integrates with DialogShift, a chatbot that resolves 97% of guest queries, of which there are 4,000 per month. It’s also boosting revenue by driving a lot of upsells.
Ligula Hospitality Group runs 41 hotels in Sweden, Germany and Denmark. They connect with Atomize to automate their revenue management, managing over 8,000 rates and 6,000 vouchers. No human could manage that without their brain exploding, and the AI is able to provide much better and faster pricing direction.
harry's home is a family-owned Austrian hotel group. They partner with GauVendi to provide dynamic, attribute-based booking. Guests can personalize their stay by choosing specific features (high floor, sea view, a bath as well as a shower), meaning they’re happier and you get more revenue. 60% of guests use the automatically generated ‘most popular’ options.
Get set for the future
For every hotelier, future-proofing your tech stack is an absolute must. That means moving to the cloud if you aren’t there already. Without access to the smartest, AI-powered tools, you will be left behind.
I talk to a lot of people who are scared that AI is going to take their jobs. I don’t think this is true: hospitality is and always will be a people-fronted industry. The people who will take your jobs are the ones willing to embrace AI, those who are already helping their hotels to operate more efficiently and boost revenue.
We shouldn’t fear AI. Its huge potential is what makes this such an exciting time for hospitality. We’ve only seen a glimpse of what it can do so far, and I’m beyond excited to see where it takes us over the coming year.
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