AI in the Hospitality Industry: Pros and Cons

/AI in the Hospitality Industry: Pros and Cons

AI in the Hospitality Industry: Pros and Cons

|2019-09-19T15:31:10-04:00September 18th, 2019|

By Donald Fomby

Over the last several years, AI-powered technologies like voice- and text-enabled assistants and chatbots have become a usual part of our lives. In fact, we should be approaching the point where we would be totally okay with AI managing our homes.

Even though sci-fi movies have led us to believe that AI’s ultimate purpose is to take over humanity, its main goal is to serve us and make our lives better. Serving people and providing them with pleasant hospitality as some of the goals of AI make it a perfect fit for the hospitality industry.

So, instead of taking over and telling us what to do, AI can assist hospitality professionals to improve the experiences of travelers. In fact, the use cases of AI in the industry is quite impressive, and the technology seems to be well-positioned to enable people to enjoy their stay.

But can hotel managers really rely on AI to make decisions? Are AI algorithms truly ready to supply useful information and streamline hotel operations?

AI Applications in the Hospitality Industry: Pros

Try to imagine an AI-enabled hotel where technology is responsible for everything. While it sounds like something that movie directors should consider for their next project, having such an establishment is really much closer than you think.

Pro: Answering Guest Questions on Hotel Premises

Germany-based Model One has been using a robot named Sepp to answer practical questions and providing helpful information for guests. Sepp’s knowledge comes from IBM’s Watson Conversation Services, which helps it with understanding people’s requests and learning new information to be more useful.

Sepp Greeting Guests at Motel One. Image Credit: IBM

For example, the robot can let guests know when breakfast is served or give them a quick update on the weather in town, among other things.

Virginia-based Hilton McLean has also received an upgrade in the form of Connie, an AI-enabled concierge. This little robot – it’s about two feet tall – also takes advantage of IBM’s Watson Conversation Services and helps visitors with finding their way around the hotel and answers other questions.

“It’s trying to see the person as well as hear the person,” USA Today quoted Rob High, IBM’s Watson vice president and chief technology officer, as saying. “It is itself vocalizing and it’s using its arm gestures and body language. When it is asked ‘where’s the elevator?’, it says it’s down the hall to the left while pointing down the hall to the left.”

Connie, Hilton’s AI-powered robot concierge. Credit: Hilton Worldwide

Like all the above mentioned robots, Connie constantly learns from its interactions with guests and improves the recommendations it provides. The hotel’s staff also has access to its question log to be able to make quick improvements.

Pro: Hotel Surveillance

Europe and the U.S. are not the only destinations where AI-enabled robots are starting to make a difference. Singapore-based Millennium Hotels and Resorts properties have been using similar technologies since 2017. Six service delivery robots perform such duties as taking amenities to guest rooms and patrolling the buildings.

According to reports, the company has saved the security team 111 manhours, as human employees could now watch live footage provided by robots instead of monitoring the facilities themselves. In addition to saving time, the robots also help with handling unexpected staff absences and high occupancy periods more effectively.

Pro: More Personalized Search Results

But robot concierges aren’t the only area where AI is impacting the hospitality industry. Last year, a tech company called Avvio launched the world’s first booking engine powered by machine learning, Allora. By utilizing AI, the tool brings insights from users’ interactions together and determines the ways to optimize their experience by finding the best hotel or experience.

By personalizing search results, the engine maximizes the chances of conversion, thus taking personalization to a whole new level. All of this is possible thanks to the intelligent analysis of thousands of properties and customer preferences based on geography, booking history, site interactions, and other factors impacting the choice of a hotel.

Pro: The Ability to Enable Travelers to Research Travel Options with a Chatbot

This one is also about personalization. A recent study done by Booking.com revealed that 75 percent of customers preferred self-service options to get answers for simple requests, which makes chatbots a perfect option in this case.

Here’s the list of the features and benefits that the company’s chatbot is currently capable of providing:

  • Assistance with existing reservations
  • Answering common questions about property policies
  • Answering question regarding transport, date changes, arrival and departure times, and payment.

According to ChatbotGuide.org, Booking.com’s chatbot is capable of handling about 50 percent of users’ post-booking accommodation-related requests. In case it can’t provide an appropriate answer, it redirects the user to a human customer service team member.

The problem of providing multilingual support with chatbots are also solvable by translating the scripts; for that, the use of translation services review sites like PickWriters is recommended to ensure proper localization.

So, in addition to helping customers with managing their experiences and getting answers for typical requests, the chatbots are also useful for hotels to improve customer service.

AI Applications in the Hospitality Industry: Cons

But will the abovementioned benefits come at a price? There have been quite a few claims made against the use of AI in many industries, including hospitality, so knowing about them is certainly useful for companies looking to implement the technology.

Con: AI is Still Developing

Even though AI has made tremendous progress in recent years, the field is pretty much in its infancy. In fact, Andrew Moore, Google’s vice president and an AI leader, has the following to say on this matter, according to CNet:

“AI is currently very, very stupid… It’s not something we could press to do general-purpose reasoning involving things like analogies or creative thinking or jumping outside the box.”

There’s even a term for that, “AI Stupidity,” and people use it to describe the inability of the technology to make reasonable decisions based on the available data. For example, since AI’s decisions are based on human input, it’s possible to feed it biased or incorrect data, thus causing irrelevant, biased, or inappropriate decisions.

While this con can be overcome with time as the technology develops, it’s clear that at this point AI can’t be trusted with making important decisions.

Con: Data Privacy Issues

This is one of the most pressing concerns that all businesses looking to take advantage of AI will face. Data collected by the technology during interactions with users can be potentially used for other purposes, therefore, the risk of data privacy violation is involved.

A recent study by Intouch International also shows that customers understand this concern very well. Specifically, the company discovered that 9 in 10 American Internet users say they’re concerned about the protection of their personal information online. Moreover, more than 60 percent of the surveyed are also advocating for stricter national privacy laws.

This means that hotels may face some troubles with getting more customers to use their AI-based tools. Besides, they’ll also have to obey data privacy laws and ensure the ethical use of data. However, if they follow all laws and regulations, AI can become a major source of competitive advantage.

The Verdict

From assisting hotel personnel with answering guests’ questions to providing personalized recommendations via dedicated search engines, AI definitely has a future in the hospitality industry. However, in order for the technology to become the new best friend for both hoteliers and travelers, some significant challenges will have to be resolved.

With more and more countries working on data privacy and other AI-related laws, it’s reasonable to suggest that the hospitality industry will have to follow a bunch of regulations to take advantage of the technology. The key to success for hoteliers here will be to show that it complements the personal side of the hospitality industry and effectively improves the experience of customers.

If these requirements are met, it’s safe to assume that AI will soon begin changing the way the hotels are run.

About Donald Fomby

At a relatively young age, Donald Fomby has already amassed impressive experience as a freelance writer. Donald studied Computer Science at Texas A& M. He has a passion for technology, social media and travel.

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