Artificial intelligence offers tremendous opportunities to improve guest satisfaction and also, and more importantly, to increase hotel efficiency and profitability at the same time. Hotels are now increasingly using systems that work with AI to also intercept employee churn and save resources. AI can be used for a variety of functions, such as customer service, personalization, sales processes, direct messaging, pricing strategy, and even responding to reviews. However, with all the positives AI has to offer, there are also concerns about the potential impact of AI on the industry and on employees and guests. This article looks at the opportunities and potential threats or risks of AI.
Opportunities of AI in the hotel industry:
- Personalized guest experience: software applications or systems driven by AI are able to collect and simultaneously analyze data about guests to provide personalized, tailored recommendations to significantly improve the guest stay. An example here is chatbots, on the hotel website, which can help guests book rooms or answer general questions.
- Increasing efficiency: AI can automate and optimize processes to increase efficiency in hotels. For example, AI algorithms in room cleaning can reduce labor by automatically determining the optimal order in which rooms should be cleaned.
- Cost reduction: by automating tasks and processes, hotels can save costs while improving operations. For example, AI systems in the human resources department can make hiring easier while reducing costs.
- AI is available 24/7 and can partially take over human tasks around the clock, saving costs and resources.
- Quick response to customer requests is one of the biggest challenges for the hospitality industry. By using AI, the response time is faster.
- Many back-office and routine tasks can be automated. This reduces human error, increases efficiency, and most importantly, frees up staff for more important tasks, such as direct guest communication.
- AI can facilitate upselling. By constantly learning and analyzing data, AI can suggest upsells of interest to the guest, helping to increase sales and guest satisfaction.
- Sophisticated AI tools can also collect relevant data in revenue management (weather, Google searches, reviews, competitors, demand, events, etc.) and turn it into meaningful recommendations, which can then also be automated, again saving time and resources and increasing revenue.
- AI tools can also be beneficial in the hospitality industry. Food waste especially in large hotels and/or restaurants is becoming more and more of a problem. Here, AI tools allow companies to monitor the quantities and types of food purchased, as well as consumption data. In this way, companies can more accurately predict their needs, avoid waste, and ensure that products do not run out.
- Predicting the use of electricity and water, tracking consumption and reducing costs can also be a task for AI. For example, in-room heating and air conditioning can be connected to the hotel's PMS so that energy is not wasted on unoccupied rooms.
Dangers/disadvantages of AI in the hotel industry:
- Privacy: AI systems collect large amounts of data about guests, which can lead to privacy concerns. Hotels need to ensure they adequately protect their guests' data.
- Job loss: The automation of jobs through AI technologies could lead to some jobs in the hotel industry becoming redundant or undergoing radical change.
- Lack of personal interaction: the use of AI systems may contribute to hotels having fewer human interactions with their guests, which may lead to guest dissatisfaction as they feel less welcome and their stay is negatively affected.
- Technology dependency: In the event of a server failure or problems with the Internet, many of a hotel's functions are at risk of being crippled.
- High cost in acquisition: Developing a machine that can simulate human intelligence is no small feat and can be a deterrent to purchase.
- AI currently cannot think outside the box. AI is able to learn over time based on pre-injected data and previous experience, but currently cannot be creative in its approach. That means it lacks the human component.
- Humans function as teams, and managing teams is essential to achieving goals. There is no denying that robots are superior to humans when they work effectively, but it is also true that human bonds, which are the foundation of teams, cannot be replaced by computers.
AI offers tremendous opportunities for the hospitality industry to improve the guest experience and increase efficiency. However, there are also concerns about the potential impact of AI on the industry, its employees and its guests. Hotels need to ensure that they are using technology transparently and ethically, while ensuring that guests continue to have a personal and positive experience. AI is a powerful tool that will transform the hotel industry, but it is important that it is used in a way that serves the interests of all stakeholders and is balanced with the human element.