CORAL GABLES, Florida — Artificial intelligence is quickly growing its role in the hospitality industry, both on the guest-facing side and internal hotel operations.
During the second "Views from the Boardroom" panel at the Americas Lodging Investment Summit Caribbean and Latin America conference, hotel executives spoke about the current uses of AI and where it may be headed.
The way people are booking hotels and making other hotel-related decisions is changing, GHL Hoteles CEO Andrés Fajardo said. Collectively, there’s been a lot of work put into making good webpages, have the right positioning on online travel agencies’ sites and generally a good online presence, but AI chat agents are changing the game.
Many travelers are using ChatGPT, Claude or other chatbots to help them plan their trips, he said.
“They know what you do for work, what you do at home, how you like to eat, et cetera,” he said. “So, we’re seeing a lot more people go in and ask their agent, ‘Hey, I’m going to Miami. Where should I stay?’ ‘Oh, based on your profile, I recommend these three or four hotels.'
“That’s a lot of power,” he said.
Travelers used to just go to the OTAs or brand websites, and the hotels had to differentiate themselves among those, he said. Now, there are four main AI chatbots. That’s not many to choose from, and there’s somewhere between 12% to 25% of hotel revenue that could come in that way.
While hoteliers are generally aware the general direction this is headed, no one knows exactly, Fajardo said, pointing to the question whether these recommendations will be true recommendations or ad based.
“We don't know, and I think we all have to be ready, because I do think there's going to be a significant change in the relative power of the players in the value chain,” he said. “I think these intermediations of the value chain might be happening as we speak, but we don't know exactly where it's going to land.”
Mauro Rial, chief operating officer of North and Hispanic Americas at Accor, said his company also believes AI is the next big thing for hospitality. There are three areas for engagement: guest experiences, operational efficiencies and commercialization.
Accor is still at the beginning of its experiments and tests with AI, but it is working with a platform that uses a large-language model to analyze the billions of comments it received over a 24-month period, he said. The comments are a useful guide because they can tell companies when a guest has had good experiences with specific aspects of a stay or when the brand needs to do some work.
The brand’s website has an explore feature through its booking engine that lets guests put in requests, such as recommend a hotel in Rio de Janeiro for a family of four, he said.
“We've seen growth 20 times of all the different searches that have arrived into our website coming from an AI search,” he said. “It's something that we're working a lot [on], where we believe we need to continue improving.”
Another area Accor is using AI for is to reduce the administrative work of its staff, he added.
Hyatt Hotels Corp. is also implementing an AI-enabled search of its website, said Javier Águila, executive vice president of Hyatt's Inclusive Collection. It tries to push data analytics to get as much data as possible to implement any changes necessary at its hotels.
He said he agreed with Fajardo that no one knows how it will end and that the power of the brand is going to be what makes a difference.
“At the end of the day, if you have brands that are distinctive, that are true and really deliver what you're promising and they're consistent, then all the information that we get to the customer to decide, whatever the channel is, will drive it to our brand,” he said.
The AI chatbots are searching not just hotel websites but everything, said Keith Pierce, co-CEO of Sonesta International Hotels. Whether it’s part of a brand or an individual property, hoteliers should put as much communication out as they can.
“In podcasts, in local communications, in press releases, in local newspapers — because they are sweeping everything,” he said. “The more you can define and describe your property and experiences, the agent will find that, and it will lead you back to the Brand.com.”
This approach could help hoteliers take back some of their share from the OTAs that have been dominant for last two-plus decades, he said.
“We've been spending a fair amount of time with our marketing dollars, figuring out how can we put out more communication versus just traditional advertising communications in this particular case, because the agents are scraping everything,” he said.
Data is the key, specifically the granularity of it and the consistency of it, Fajardo said. The amount of data a hotel company can put on a hotel’s website is limited, so it needs to optimize the bandwidth and attention a person can put into a webpage. For a AI agent, however, it can go through lots data quickly, so now hoteliers can be more granular.
It’s not enough to say a hotel offers breakfast now, he said. Instead, the website needs to provide details, such as whether it’s keto or allergy-free.
“The granularity has to be there and the consistency, because if you say one thing here, one thing there, another thing there, there’s going to be no way that a tool looking at all this data is going to recommend your hotel,” he said.
Since no one knows where AI-driven bookings will land, hoteliers must be aware of what’s going on and be ready and working on their own foundation, he said. Flexibility is necessary, because holding fast to one solution at this point is dangerous if things don’t go in that direction.
People will ask their AI agents where they should stay, and that’s where powerful brands with strong investments and recognition will be key, particularly in a world where points in a loyalty program may be less important, he said.
“I think the decision of the brand making sure that the brand delivers on the promised expectation you is going to be absolutely key,” he said. “It's interesting, because I don't think that huge investments in technology is really the answer at this point.”