How Chatbots Are Changing the Way Hotels Interact with Guests

Travel is a complex business with many moving pieces and the industry has not yet gotten to a place where automated responses and chatbots can sufficiently replace humans for everything. While chatbots are great at handling simple sales and service requests, their limitations become apparent when customers ask nuanced questions or inquiries that go beyond what they were coded to respond to. This can create friction in customer interactions and actually lead to poor experiences and lost sales.

For instance, many travel requests such as itinerary changes, cancellations, or modifications still require human interaction. By having the customer on the line with a live agent, some of these tasks can be expedited. Additionally, given the high cost of travel, many consumers prefer to speak with an individual prior to finalizing their reservation. If questions emerge about a property, its location, or the associated amenities, a trained live agent can often provide answers more quickly and thoroughly than a chatbot. Additionally, insufficient or incorrect responses from a chatbot can significantly disrupt the customer journey. 

However, there are certain demographics that do not like to interact with individuals over the phone and would instead prefer to interact through a text-based solution. To this end, chatbots are beginning to play a larger role in handling routine service requests. It's also cheaper and more scalable for companies to invest in this type of service paradigm. Despite this reality, consumers still desire high-touch service with quick responses to their questions, no matter how esoteric or abnormal those questions may be. This reality is driving the use of a hybrid approach, where chatbots will assist in routine requests and questions while human agents handle escalated issues via chat or phone. At some point, likely more than five years from now, chatbots will become so sophisticated that human agents may become less or even unnecessary. There could be a new normal where a guest interacts with his "virtual concierge" throughout the stay to process room service, cleaning requests, and more.

Until that happens, hotels and travel agencies are being challenged to find new chatbot-like mediums that can provide high-touch service at scale to consumers.

Unfortunately, those companies that do go all in on chatbots tend to hide phone numbers as they try to route everything through chatbots and email agents. This can cause quite a bit of customer frustration and even create some brand backlash. Instead, the correct way to respond to the shifting technology landscape is to provide customers with a choice on how they would like to interact with the brand.

While chatbots can help with overall profitability, utilizing them does not have a material impact on top-line performance. Customers expect a certain level of service from brands. If brands live up to that service expectation, they can create meaningful long-term value and customer loyalty. If brands provide subpar service experience through chatbots, it could impact their ability to garner customer lifetime value, which would impact revenue. 

While there will definitely be situations in which chatbots can replace travel agents, the personalized nature of travel will always provide a space for human agents to provide higher levels of service. If anything, the changing travel preferences we are seeing will provide more of a window for higher touch human-to-human service interactions in the future. Travel is becoming a good through which people measure their success. Younger generations view travel, and the associated experiences one takes away from said travel, as more rewarding and fulfilling than amassing material possessions. This will only increase the expectations consumers have around the service experience.