AI Business Strategy

AI is coming for hospitality and why that’s a good thing

By Rebecca Kelly, CEO and Founder of VenueScanner

There’s a lot of talk about AI taking humans out of hospitality, but I actually think we should be talking about the opposite.

Hospitality is one of the most human industries there is, but it’s also an industry where people spend an enormous amount of time doing things that don’t really need a human. Answering the same query for the 50th time, pulling together reports, checking prices, writing another email, working out which customers to target, or trying to predict whether next Saturday is going to be busy.

If AI can take some of that away, why wouldn’t we use it? But given the hospitality industry has so far been somewhat reluctant to adopt the technology, the more interesting question we should be asking is what we use it for.

AI could finally make hospitality genuinely personal

Hospitality loves to talk about personalisation, but a lot of it is still pretty basic. “Welcome back, Tom.” “Here’s 10% off your next stay.” That’s not really personalisation, that’s just putting a name into an email.

AI changes the equation because it can look at much bigger sets of information and spot patterns that humans simply can’t. What someone has booked before. When they tend to book. What they’re interested in. What they’ve ignored. What other customers with similar behaviour have gone on to buy. And that could be hugely powerful for venues.

At VenueScanner, someone looking for a venue isn’t really looking for a room with four walls and 100 chairs, they’re trying to create something. A Christmas party, a team away day, a birthday, a wedding, a conference.

The more AI understands that intent, the better we can get at matching people with the right spaces and experiences. And there is a big appetite for this. Research from Oracle found that 74% of travellers were interested in hotels using AI to tailor services and offers, including things such as pricing, food recommendations and discounts.

The opportunity is to move from “What venue are you searching for?” to “What are you trying to make happen?” That’s a much more interesting question.

The boring stuff is where AI could make the biggest difference

We’re naturally drawn to the flashy side of AI – robots, virtual concierges and futuristic hotel rooms. But I think some of the biggest gains will come from much less exciting things.

Take pricing. Hospitality businesses are constantly trying to work out what to charge, based on demand, seasonality, events, competitors and availability. Historically, a lot of this has involved spreadsheets, experience and educated guesswork. AI can look at all of those signals at once and identify changes much faster.

There are already some compelling examples. Hotel Quellenhof found that moving from manual pricing to AI-powered dynamic pricing saved the team around six hours a week and increased RevPAR by 34% in its first six months.

And it isn’t just about hotels. For venues, imagine being able to understand that demand for a particular type of space is going to spike because of a major event happening nearby, and adjusting pricing or marketing accordingly. Or spotting that a space is consistently empty on Tuesday afternoons and automatically creating an offer designed to fill it.

That’s not AI replacing a revenue manager, it’s AI giving them information they couldn’t realistically gather themselves.

Customer service is another obvious win, if we don’t overdo it

Anyone who has ever booked a venue knows how many questions there are. Is there a minimum spend? Can we bring our own caterer? What time can we get in? Can we put up branding? Is there a projector? Can we extend the booking? And venues answer versions of these questions all day, every day.

AI is very good at answering questions like these. But I don’t think the answer is an AI chatbot that makes it impossible to speak to a person. Quite the opposite. Let AI deal with the 80% of questions that are straightforward, so the venue team has more time for the 20% that actually need them.

If I’m planning a £20,000 corporate event, I don’t want a chatbot when something goes wrong. I want someone who understands the event, knows the venue and can make a decision. That’s the bit of hospitality we shouldn’t lose.

Research from McKinsey found that 59% of travel executives surveyed said AI was already increasing employee productivity, while 33% said it was improving customer personalisation. That feels much more useful than the idea of simply replacing people.

And then there is marketing, which AI is completely changing

This is probably where I think the biggest shift is happening. For years, marketing was about getting your message in front of as many relevant people as possible. AI is moving us towards something much more individual.

It’s not just about using ChatGPT to write a social post quicker. It’s about understanding who your customer is, what they’re looking for and what they’re most likely to respond to, and then changing the message accordingly.

A venue might have 10,000 customers in its database, but those people aren’t one audience. Someone booking a 500-person conference shouldn’t receive the same marketing as someone booking a 30th birthday party.

AI gives smaller hospitality businesses the ability to do the kind of segmentation and personalisation that historically required a huge marketing team.

And there is another change coming that I think hospitality businesses need to start paying attention to: people are increasingly asking AI where they should go, rather than just searching Google.

If someone asks ChatGPT for “a cool London venue for a 100-person summer party”, the way businesses get discovered starts to change. It isn’t enough to have a website that ranks well for “London event venue”.

Businesses need to make sure AI can actually understand what they offer – the type of events they host, their capacity, location, pricing, facilities, style and the experiences they create. That’s going to become a new battleground for hospitality marketing.

The real opportunity isn’t replacing people

I think hospitality sometimes looks at AI and asks what jobs it can replace. But I’d ask what could our people do if we took all the pointless admin away?

One of the most interesting applications is taking the guesswork out of day-to-day operations. CAVA, the US restaurant chain, has been using AI to bring together data such as sales, weather and local events to help managers predict demand, plan staffing and improve ordering.

That’s where I think AI gets really interesting for hospitality. It’s not about replacing the person running the venue or restaurant, it’s about giving them a much better view of what’s coming so they can make smarter decisions.

And that’s the direction I think hospitality should be heading in. Not fewer humans, but better use of them. Let technology handle the forecasting, spot the patterns, write the first draft, and answer the repetitive questions. Then let a person decide what to do about it.

Because the things that make hospitality great aren’t the things AI is good at. AI can tell you that a customer has booked three events with you, but a good hospitality professional can remember why those events mattered. AI can recommend a venue based on 20 different data points, but a great venue manager can walk someone around a space and immediately bring their idea to life. AI can write the email, but it can’t make someone feel genuinely looked after.

That’s why I don’t think AI is the end of human hospitality, I think it could actually give us more of it.

The businesses that get this right won’t be the ones that automate everything. They’ll be the ones that automate the things that shouldn’t have needed a human in the first place, and use the time, data and insight they gain to make the actual experience better.

That’s a much more exciting future for hospitality.

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