5 Ways Artificial Intelligence Offers Real ROI

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5 Ways Artificial Intelligence Offers Real ROI

By Julie Ritzer Ross, Contributing Editor - 10/18/2019

Voice-enabled devices, chatbots and other forms of artificial intelligence (AI) are quickly gaining ground in hospitality. According to Hospitality Technology’s 2019 Lodging Technology Study, 44% of hotel operators consider AI a top transformative technology, with the highest potential for future impact.  Hype however doesn’t necessarily yield returns and  buzz alone doesn’t make a business case for implementation. Here, HT explores how AI can address common problems faced by hotel operators and provide real ROI.

Problem: Customization limitations

Solution: Voice-activated, cloud-managed, intelligent digital assistants improve guests’ experience by enabling them to access hotel amenities and services via multi-lingual voice and high-resolution touchscreen interfaces. 

At The Cosmopolitan of Las Vegas a chatbot named Rose is able to fulfill guest requests and answer 82% of inquiries without human intervention, resulting in an average of 28% more on-property spend when guests are highly engaged (more than 5 messages), according to Tom Evans, chief marketing officer.  

Designed by R/GA, Rose incorporates more than 1,000 text conversation threads. In addition to service requests, she recommends and offers ways for guests to book experiences, such as restaurant reservations, spa treatments and tours. Rose also “drives” visitors to its clubs and bars by giving them “insider information.” 

Angie Hospitality’s Angie gives guests local information such as nearby attractions, as well as traffic, weather and flight details. The technology also permits guests to control the room TV, lighting and temperature; listen to music through Bluetooth speakers; and make hands-free telephone calls. Lighting and temperature preferences are remembered for future visits. 

Innisfree Hotels implemented Angie in the lobby and all 90 guest suites of The Mercantile Hotel New Orleans. Joshua Herron, director of technology and experience, notes that guests seem happy to leverage the device to get information about what to see and do, and how to get around. 

Some hotels and restaurants, sources say, build chatbots into their own apps, while others opt to embed smart messaging into apps and websites with bot-builders and messaging APIs, like those from Oracle. Oracle and others anticipate that in the near future, brands will use chatbots to perform functions like suggesting a taxi or ride service when a guest has consumed a significant amount of alcohol.

AI can also minimize the potential to upset guests by  preventing operators from making recommendations that don’t jive with individuals’ preferences, point out InnSpire and Yobe Hospitality. For instance, with an AI solution in place, a business traveler would not be offered to book a babysitter, nor would a wheelchair-bound guest be invited to a complimentary high-impact exercise class in the fitness center.

According to Saggezza, access to virtual assistants and chatbots may even improve a guest’s loyalty by enabling them to avoid potentially embarrassing or anxiety-producing encounters with staff. As an example, a hotel guest may be reticent to repeatedly approach front desk staff for restaurant recommendations or practical information. One caveat when implementing voice-activated technology and AI: ensure that the most appropriate employee has real-time access to the request, in case follow-up or further action is needed, advises Jorge Agnese, vice president of consulting, travel and hospitality at digital consulting firm Oz Digital Consulting

“While most requests will be handled automatically, the experience will be enhanced by having a human provide a personal touch,” Agnese says. “...For this, the employee should have information about the guest at their fingertips, along with information provided by the recommendation engine, (because) the goal is to make sure the guest receives white-glove treatment and feels personally cared for.”

At The Cosmopolitan Hotel & Casino, LiveEngage, a brand-to-consumer messaging platform from LivePerson allows human agents to monitor Rose’s conversations and intervene when necessary. This helps to support the high level of guest satisfaction and increased on-property spend afforded by the chatbot in the first place, Evans says.

Problem: Lackluster guest engagement

Solution: Special offers and attempts to engage consumers and cultivate repeat business will be most effective when they closely mesh with guest preferences and needs. By using intelligent property management systems and other solutions that harness sophisticated deep learning algorithms to identify trends gleaned from personal preferences, past trips, choice of amenities, and even favorite payment methods, hotel operators can create relevant real-time offers for guests at different stages of their experience. These stages include pre-booking, the booking process itself,  the interval between booking and the actual hotel stay,  the visit, and post-departure. For example, if AI reveals a guest always stays at a particular hotel during a particular time, management can offer a special rate for those dates as an enticement to book there.

Operators can harness historical data to proactively target customers. For instance, if the algorithm determines that a guest stays at a hotel on the first Tuesday through Thursday of every month, but has yet to make a reservation for an upcoming month, a booking reminder can be automatically sent to the guest. Additionally, hoteliers might apply insights gleaned through AI to further customize offers and perks by determining, for example, which welcome amenities an individual favors based on previously shared information about likes and dislikes, reactions to past “perks,” in-room dining and on-premise restaurant orders, and the like. 

In the future, hoteliers and restaurateurs will apply deep learning algorithms to even more comprehensive data, says SkyTouch Technology. Its PMS leverages deep learning algorithms to help hoteliers develop timely offers. This information will come from third-party data sources including 5G devices and the Internet of Things. Data will be derived from images, video and speech, and AI will improve to the point where it will uncover  details on consumer patterns/behaviors and hidden patterns that are currently impossible to identify.

Problem: Recruitment & retention challenges

SOLUTION: Hotels frequently have trouble attracting and tracking appropriate staffing candidates. Inefficient screening and interviewing of prospective hires and a less than optimal level of communication with new employees also rank among common hospitality industry recruitment and retention challenges.  AI recruiting software from vendors like AllyO addresses these obstacles by using AI to locate candidates via integration with online job platforms and a “text-to-apply” function. The system also utilizes texting to schedule and reschedule interviews, perform post-interview follow-up and execute “new hire” check-ins at the 30-, 60-, and 90-day marks; automates candidate pre-screening via natural language processing capabilities to eliminate applicants who do not meet critical job requirements (e.g., minimum age) or lack key job skills and automates background checks. Additionally, it tracks individuals who were not initially hired for a position or chose not to accept an offer, automatically communicating with them should the system identify them as viable candidates for other open positions down the road. Ocean Casino Resort needed to hire several thousand individuals in preparation for its early summer 2018 opening in Atlantic City, N.J. The property ran billboard, radio and newspaper ads urging candidates to “text to apply” for a position. A total of 1,200 qualified applicants were screened, scheduled for interviews and tracked via the AllyO software. Management was able to successfully staff the hotel, exceeding industry standards with a 92% applicant engagement rate, reports Lori Loveland, director, human resources. 

“(The software) was an innovative way to attract and qualify candidates,” Loveland says. “It was very well received,” which along with intelligent AI-powered screening “gave us the competitive edge to hire top talent.” 

Problem: Operational inefficiencies

Solution: Integrating virtual assistants and chatbots with PMS or other back-office systems can lead to significant time savings. 

Hotel Internet Services cites the example of one hotel client that saved 901 hours, or the equivalent of 112 work days, in less than a year  by equipping guest rooms with virtual assistants to handle guest requests and questions.

At The Mercantile, Angie has yet to be integrated with other systems. However, the Angie team created a messaging system through which guest requests and work orders can be conveyed from Angie to the property’s Quore back-of-house management platform. 

“Besides freeing up the staff from standard and repetitive requests, allowing them to have more personal interaction with guests, ... Quore has made our operations much more efficient,” Herron states. “Guests appreciate the efficiency, too — no one likes to stand in line at the front desk just to find out where the streetcar is.”

Amadeus Hospitality is working with Amazon to integrate its platform with Alexa in-room digital assistants. Once the integration is complete, guest or staff requests made through the device will go straight to the Amadeus service optimization system, reducing the amount of time needed to process and fulfill each one.

“AI and voice-enabled systems are also having a positive impact on operating efficiencies by predicting staff under/overflows,” Agnese notes. “Additionally, these systems can tell you who among your staff performs better by up-selling, so you can give those team members priority for high-volume shifts.”

Problem: Lost booking revenues

Solution: Hotels continue to lose revenue due to “cart abandonment” during the online booking process. In its Q2 2019 Hospitality Industry Report, marketing technology services provider IgnitionOne pegged such losses at $3.2 billion, reflecting a 33% increase since Q4 2018. Customer intelligence platforms like those available from IgnitionOne can potentially prevent cart abandonment by analyzing customer behavior (for example, hesitancy to book a room after idling on a site for a certain period of time) and responding to it (e.g., suggestively “selling” the property or offering a different rate) appropriately.

Hoteliers remain susceptible to lost booking revenues due to phone calls from “fraudsters” looking to make reservations with false credentials, according to NextCaller. The company’s VeriCall fraud detection technology utilizes an algorithm to identify spoofing and assess calls for threat level as they are received. The algorithm continues to become more intelligent based on data science, machine learning and customer feedback.