How to Find the Right Solutions in a Fast-evolving Field
In 1857, a five-story New York City hotel installed the world’s first passenger elevator. A century later, in 1958, Sheraton introduced Reservatron, the industry’s first automatic electronic reservation system. This year, online travel agency Expedia was among the first to integrate ChatGPT into their system, making booking a trip as easy as typing a few words.
Travel and hospitality businesses have always been early to the party with new technology. However, the frenetic pace of change in recent years has left even the most forward-thinking hoteliers a little unsure of where to place their bets.
“The tech offerings are growing and sometimes it can be challenging,” says Luke Ling, General Manager of Hotel Blu in Vancouver, notable as an early adopter of in-room voice assistants in 2015. “More time goes to filtering out the solutions and qualifying them so that we can ensure they’re right for us.”
To help you wade through all the options, here is an overview of the tech trends currently shaping the hospitality industry.
Keep an Eye on AI (While It Keeps an Eye on You)
AI has elbowed its way to the front of almost every conversation about tech trends since the launch of ChatGPT in late 2022. Although AI has quietly been working its way into our daily lives for years, the recent breakthrough in “generative” AI—the kind that’s capable of having a conversation with you—has caused a stir because of its potential to replace uniquely human tasks.
For the average hotel, the uses of generative AI are still in their infancy, but the possibilities are easy to spot. With Expedia and Booking.com’s integration of ChatGPT, for example, travellers simply state their preferences, and an AI assistant does the planning for them, personalizing itineraries from roughly 1.26 quadrillion variables such as hotel location, room type, dates, and price. The “virtual agent” is even there to help work out issues like date changes and cancellations, without needing to bring another human into the equation.
At the property level, it’s easy to imagine how a guest talking to AI as he navigates purchases would offer treasure troves of personalized information that staff could use to further tailor the experience to the guest’s preferences. Such a world, in which personal AI agents can simply communicate their clients’ wants and needs to the hotel’s AI platform—and then, say, adjust in-room climate controls or request extra amenities—might not be far off.
Naturally, not everyone is a fan of AI encroaching on human territory. “AI solutions really aren’t on our radar,” says Ling. “Our main focus here is the boutique experience where we really do want to engage directly with every guest.”
AI as an Analyst
AI tools are also evolving in ways that are less likely to stir controversy. Machine learning, which allows AI platforms to comb through vast data sets to automate processes and predict outcomes, makes it an ideal ally for hotel revenue management, especially dynamic pricing. AI is capable of analyzing countless variables (competitor rates, RevPAR indexes, air travel patterns, weather data, and social media, among others), and is therefore able to optimize prices for hotels, restaurants, and meeting venues in real time.
“AI is capable of analyzing countless variables.”
This technology already drives many of the latest dynamic pricing tools available to hotels. A wider range of inputs, such as a consumer’s psychology and perceived value of the purchase are likely to follow as AI-assisted dynamic pricing evolves.
The related frontier of advertising is also seeing AI-driven evolution. Earlier this year, Google rolled out “Performance Max for travel goals,” which uses AI to automate the process of creating and monitoring online ad campaigns. Simply select your hotel and the platform does virtually everything else, pre-populating ads with suggested images and copy, serving the ads across its network (including Google Maps, Search, and YouTube) and automatically optimizing your spend and audiences over time.
As AI advances, consumer demand also drives advancements in more tangible forms of tech, like smart in-room devices. Franchesca Adriano of Axxess Industries, which specializes in smart guest room controls, has seen an increase in hoteliers responding to a desire for a “more intuitive experience for their guests.” Their electronic do-not-disturb controls, for instance, are a welcome change from the traditional paper signs, especially for eco-conscious guests. These controls also allow housekeeping staff to work more efficiently, as occupancy sensors indicate when rooms are free to clean.
Expect to see more advancement in the area of smart room controls in the near future. “There’s a lot of room to improve automation and control and make it even more seamless, more user-friendly,” says Adriano.
The Tipping Point
Leveraging the technology guests carry in their pockets, hotel giant Wyndham made waves last year by rolling out a mobile tipping platform for their US and Canadian franchisees.
The platform allows guests to scan a QR code, select a staff member and choose how much to tip. QR codes are unique to each staff member and the tips can be deposited directly to their bank account.
“The biggest success story is the size of the average tip, which is just under $10.”
“The biggest success story is the size of the average tip, which is just under $10,” says Wyndham CIO Scott Strickland. “That’s a substantial increase over what would historically be a tip of $3 to $4 and becomes all the more important amid the labour shortages currently impacting our industry.“
As the tech revolution marches on, it’s worth reflecting on the fact that remarkably little has changed about the reasons why we travel in the first place: to have the kinds of experiences technology cannot as of yet replace, like the smell of a fresh-baked baguette from a boulangerie, the sumptuous fabrics lining a faraway bazaar, or a friendly handshake from a person whose story you’ve yet to hear.
Integrating AI and other cutting-edge solutions into hospitality provides exciting opportunities, to be sure. But the best tech is that which helps you deliver memorable experiences to your guests; it is important that any advancements in our industry serve this mission above all others.
Joe Pooley is Account Director at Redshift Collective, where he helps hotels build their brand, connect with audiences, and drive more bookings.
Main image courtesy of Wyndham Hotels & Resorts