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AI Trends Redefining Hospitality Customer Service in 2024

Closed AI solutions, maintaining a human-centric approach and economic challenges for dedicated chatbot providers will become common this year.

The year 2023 was a milestone for Artificial Intelligence (AI) within contact centers, and 2024 promises to be just as exciting. As AI ascends so does the hospitality sector, which has returned with a roar since the days of pandemic lockdown. 

AI and hospitality may seem like a mismatched duo, but when it comes to customer experience they are well aligned. As AI keeps advancing, the focus on its practical uses within hospitality will become even more crucial. 

Here are three AI trends hotel owners and operators should consider as the year unfolds.

1. Emergence of 'Closed AI' Solutions 

Just like most business sectors, in hospitality, it's more appropriate to consider AI as a broad category rather than for a singular use case. Various AI models can be tailored for distinct functionality across diverse business operations. A notable trend is crystallizing in the contact center world – particularly for hoteliers: the rise of 'Closed AI' solutions. 

'Closed AI' refers to AI tools that are designed for immediate use without the need for extensive training or integration, offering immediate benefits to a contact center in areas such as customer conversation transcription, summarization, and sentiment analysis. For hoteliers, an example of a closed AI solution could be an AI-powered summarization or intent determination tool for incoming calls and chats. 

Closed AI tasks do not depend heavily on external systems or large data sets for training. As opposed to the more customizable 'Open' AI systems that require agency and specific integration into business systems, Closed AI solutions are ready for widespread use right out of the box and can reduce the speedbumps that inhibit AI adoption. In an environment where significant data training or operational adjustments are often necessary to achieve limited business value, the shift towards Closed AI signifies a move towards more accessible AI applications that can be easily activated for particular tasks. 

This differentiation in AI capabilities is important and something hotel owners and operators will need to understand.

2. Maintaining a Human-Centric Approach 

As we progress through the year, the importance of keeping humans central in AI deployments will become more prominent. During a series of AI-focused seminars across various U.S. cities in September 2022, I dug into how AI is used in contact centers, emphasizing the heightened risks and costs of autonomous chatbots in comparison to AI that supports human agents. 

Interestingly, even after ChatGPT ignited excitement in the AI community, there's been a growing plea from industry experts to prioritize human-guided interactions, using advanced language models to aid agents before resorting to chatbots. This direction, where AI enhances human efforts, is expected to persist into 2024, contributing to cost reduction, minimized risk, and heightened acceptance, all while enriching the experiences of both agents and customers. 

Initially, AI-driven chatbots may have soured the consumer experience, leading to heightened frustration. Although newer language models have improved at understanding user intentions, the complexity of programming these models (and specifically, user guardrails) required to act autonomously remains a challenge and can lead to user dissatisfaction if not executed well. 

By keeping human agents at the forefront of AI interactions, hoteliers can harness the strength of automation while allowing human agents to address any shortcomings in the AI's response, ensuring a smoother and more satisfying customer experience.

3. Economic Challenges for Dedicated Chatbot Providers

Originally standing out due to their AI sophistication, dedicated chatbot providers are now navigating a highly competitive landscape, contending not just with one, but several major players boasting extensive Large Language Model (LLM) capabilities. With AI technologies and machine learning (ML) increasingly becoming commonplace, many of these specialized providers are shifting towards serving as interfaces for the LLMs developed by giants like Amazon, Google, Microsoft, OpenAI, or Hugging Face. As the market continues to standardize AI models, these traditional chatbot companies are encountering significant economic challenges, struggling to maintain their unique value in an industry where the distinctiveness is less and less about the AI technology itself.

The Need for the Human Touch Isn’t Going Anywhere

2024 will signal a seismic shift in the hospitality landscape, driven by AI. While 'Closed AI' solutions offer instant benefits, prioritizing the human touch ensures seamless and more highly satisfactory interactions for guests. This fusion of AI and humanity promises to profoundly redefine the guest experience.


About the Author

Rob McDougall is the driving force behind Upstream Works Software as CEO. Upstream Works provides best-in-class omnichannel contact center solutions to increase customer engagement and agent success. Rob’s passion for making the agent experience better is evident with the company’s “agent first” approach. Upstream Works helps bring the customer journey together across all digital channels, applications, and platforms with desktop elegance.

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