Cutting through the clutter with generative AI
With the summer 2024 travel season winding down, the hospitality industry is coming out of one of its busiest seasons of the year. And despite macroeconomic pressures, the state of the U.S. hotel industry is strong. According to recent industry research, average hotel occupancy is expected to reach nearly 63.6% this year – an increase of 1.3% vs 2023 but just below 2019’s rate of 65.8%.
When it comes to booking a vacation, it can seem like we’re hit by an endless stream of advertisements, competing claims, and recommendations from and for different brands. In fact, 75% of respondents in Accenture’s Consumer Pulse 2024 research said they feel bombarded by advertisements and 73% are overwhelmed by too many options.
Looking specifically at hotel bookings, Accenture’s research revealed the impact of this information overload, with 77% wishing they could identify the available options that suit their needs more quickly and easily, and 70% feeling they check too many sources to understand the available accommodation options. To further illustrate the problem, the research also found consumers feel booking a hotel can be harder than buying a car.
An estimated 73% of respondents said they’d given up and walked away from making a hotel booking in the last three months – a troubling figure that could significantly affect hard-earned loyalty and revenue. How can the industry address this while enhancing and simplifying the experience?
CHECKING INTO THE FUTURE
Picture this: You’re traveling to a new city and aren’t sure where to start with your search. Rather than face a barrage of endless choices and mixed reviews, generative AI (gen AI) steps in as your personal travel advisor, offering tailored suggestions aligning with your preferences, budget, purpose of travel, and specific location. It takes into account elements like your past travel experiences, any loyalty rewards you might have, and even current local happenings and attractions. This personalized approach provided by gen AI enables travelers to make well-informed and confident decisions swiftly.
According to Accenture’s research, 60% are open to using gen AI advisors to help them find and book a stay and 65% are open to using gen AI agents that can take on a more proactive role in managing their trip.
KEY CONSIDERATIONS
As adoption of gen AI grows, it’s crucial hotels build trust by being transparent about how these tools use guest data and improve the customer experience. Additionally, continuous learning and adaptation will keep gen AI relevant and effective in meeting guest needs. Despite the technological advances, maintaining a unique brand identity is essential to avoid a bland uniformity in travel experiences. Booking a holiday shouldn’t be work, with gen AI also enhancing the elements of the experience the traveler enjoys.
In this evolving landscape, gen AI is emerging as a pivotal force, unlocking the vast potential of the travel industry and ensuring it not only meets but exceeds the expectations of the modern traveler. As its adoption increases and evolves, it will elevate customer interactions, refine the booking process, foster loyalty, and enhance revenue generation. Moreover, gen AI promises to transform the entire travel journey, extending well beyond mere booking processes to bolster traveler confidence and engagement from end to end.
Transforming travel
Hotels can leverage this openness to deploy AI advisors that enhance the decision-making process for guests, making it more straightforward and less overwhelming. Here’s how hotels can effectively implement gen AI:
Create a personal travel advisor: As mentioned, gen AI can act as a personal travel advisor, offering tailored recommendations based on a traveler’s preferences, budget, and situational factors like loyalty program status and local events. This level of customization helps travelers make informed decisions quickly and confidently. Truly successful AI advisors will be available wherever and whenever people need it, requiring an omnichannel, cross-platform solution (in-store, desktop, mobile, etc). The most successful AI agents will be similarly accessible, be personalized to their user, and provide a range of options.
Extend expertise: Marriott International’s pilot RENAI program in its Renaissance hotels is a prime example. RENAI is like a local insider who knows a destination’s best restaurants, secret spots, and can’tmiss attractions. In a fusion of new tech and traditional hospitality, hotel associates who know their cities well helped to train RENAI. Guests no longer have to wait until check-in to meet RENAI; they can connect before they leave home.
Leverage AI for marketing: In partnership with hotel marketers, gen AI also can be utilized to power creative, personalized, and effective marketing strategies. By analyzing customer data and leveraging the technologies’ capabilities in design, research, and content creation, AI can help identify specific guest preferences and deliver more targeted and intuitive marketing campaigns. This targeted approach can lead to higher conversion rates and increased customer satisfaction, as well as saving time and effort for both the company and the customer.
