Guests arriving at a hotel have certain expectations. They want a clean room, helpful staff, and a speedy check-in process. Artificial intelligence in hospitality can help meet these expectations. For instance, AI can analyze past booking data to optimize room cleaning schedules so that rooms are ready for guests immediately upon their arrival. Conversational AI companies are also enabling hotels to personalize the guest experience before arrival by providing information on local attractions and activities based on individual preferences through AI-powered chatbots and virtual assistants. The more hotels that can use AI to create a seamless experience for their guests, the better. This article will explore proven, real-world applications of AI in hospitality that improve guest experience, reduce costs, and drive meaningful business results.
One valuable tool that can help your business achieve these objectives is Voice AI’s speech recognition software. This AI in hospitality technology, along with solutions like a text-to-speech tool, can help companies to streamline operations and enhance the guest experience by creating a more efficient environment.
What is AI in the Hospitality Industry?
Artificial intelligence (AI) technology is advancing rapidly, and the hospitality industry is taking notice. The market for AI technology in hospitality was approximately $90 million in 2023. It is expected to rise rapidly, at a rate of 60% each year, until topping $8 billion in 2033. What makes this possible is that there is no singular AI for hospitality.
Instead, AI is embedded into technology that is spread across the entire hotel business, from the front desk to the back office. Hoteliers are using AI to power virtual assistants, optimize housekeeping scheduling, facilitate real-time translation, and help make dynamic pricing decisions, among many other activities.
The following are just a few real-world examples of AI in action within the industry:
Marriot Bonvoy
Marriott Bonvoy is using AI-powered search to personalize and streamline natural language searches across 140,000 luxury home rental properties served through its Homes & Villas line of business.
Universal Orlando Resort
Universal Orlando Resort has started using facial recognition technology to validate identity at park entrances to facilitate contactless entry processes.
InnVest Hotels
Canadian hospitality firm InnVest Hotels uses AI-enhanced hotel delivery robots across several properties to deliver items to guests from the kitchen and front desk.
Radisson Hotel Group
Radisson Hotel Group is experimenting with AI to enhance its sales to event planners through the use of an immersive “infinity room” that uses sound and light to help planners visualize their event spaces in real time.
Radisson leverages AI to analyze guest reviews, enabling continuous improvements based on real-time feedback.
Choice Hotel International
Choice Hotels International’s mobile app uses AI to provide personalized travel suggestions and build itineraries that match a guest’s preferences.
IHG
IHG has introduced a generative AI planning tool that allows guests to plan and book trips directly through the mobile app, offering personalized experiences and incentivizing loyalty program members.
Hilton
Hilton uses AI to anticipate guest preferences and tailor experiences accordingly, making every stay feel more personalized and intentional.
Operational Efficiency: AI’s Quiet Transformation of Hospitality Back Offices
Beyond these leading-edge uses for AI in hospitality are a variety of less dramatic but impactful use cases for back-office systems, where AI is being used to:
- Support business operations
- Improve sustainability
- Reduce security risks
The momentum behind AI is driving increased interest in hospitality: Research shows that 60% of hotels and 70% of travel agencies plan to start using AI.
AI in Hospitality Explained
Conversational AI technologies like chatbots and virtual assistants are enhancing customer service by simulating natural, human-like interactions. These tools can quickly respond to guest queries and guide them to the services they need, creating a smoother and more efficient experience.
In the hospitality industry, such technologies are being adopted across hotels, resorts, restaurants, and travel services to improve guest satisfaction and drive profitability.
AI-Driven Decision-Making: From Cost Control to Sustainability in Hospitality
Behind the scenes, AI-powered analysis of business intelligence is helping hotel and lodging companies make more informed decisions on cost control and pricing strategies. On the front line, AI supports staff through automation that accelerates service delivery and enables greater personalisation.
Many hospitality businesses are also leveraging AI to meet sustainability goals by reducing waste, efforts that benefit both the environment and the bottom line.
Why AI Matters: The Business Benefits of AI in Hospitality
AI in hospitality is poised to reshape the traditional way hotels do business.
Here are some of the many ways that AI assists hospitality operations and boosts value propositions:
Enhanced Customer Service
AI-powered technologies can strengthen customer service by speeding up interactions, personalizing service offerings, and helping businesses maintain a consistent quality of service from booking to check-out.
This is vital for hospitality firms, which, in a recent survey, unanimously voted “driving guest loyalty” as the No. 1 business driver for guest-facing technology investments.
Personalized Guest Experiences
From customized in-room mood lighting and temperature settings to personalized loyalty rewards, personalization bolsters guest satisfaction and spending, driving higher occupancy rates and repeat stays over time.
AI algorithms can play a potentially crucial role in enriching hospitality companies’ ability to deliver personalized guest experiences.
Operational Efficiency
Just over half of hotel firms (51%) believe that increased efficiency is the number one way that AI will help reshape hotel operations in the following year. Front office and guest relations are the top departments that hospitality firms are eyeing for AI-related operational efficiency gains.
Hoteliers see other traditional areas, such as sales, marketing, and general management, as big beneficiaries as well.
Improved Revenue Management
Like many other businesses, hospitality companies use AI analytics to bolster their revenue management practices. When fed with a substantial body of financial data and historical business intelligence, AI algorithms can help guide hotel pricing strategies to maximize occupancy rates, cash flow, and profitability, during peak season and off-season.
AI-based revenue management can also highlight opportunities to increase omnichannel sales.
Data-Driven Insights
Hospitality firms rank AI for business analytics as one of their industry’s most promising innovative technologies for 2024. Examining business data through the lens of AI algorithms can help staff uncover insights about operations, guest behaviors, seasonal trends, and cost management.
These insights can be used, for example, to set pricing strategies, forecast demand, and drive AI-powered automation in systems across the business.
Enhanced Marketing Strategies
Hospitality marketing departments can bolster their productivity and effectiveness through a combination of AI-enhanced analytics and generative AI content development.
AI technology can support more targeted, data-driven marketing. It can also accelerate hotels’ ability to engage in social media and respond to online reviews quickly.
Security And Monitoring
Some 68% of hospitality IT professionals say that improving the physical safety of guests and staff is a top lodging technology initiative for them. AI capabilities can enhance the effectiveness of technology like video surveillance and building access through automated functions that speed detection and send alerts about suspicious behavior.
Sustainability Efforts
AI is an essential element of the intelligent energy management systems and waste reduction planning activities that have become crucial for hospitality firms to meet their sustainability goals.
Practical application of AI can help hotel properties save on energy, reduce water consumption, and reduce their carbon footprint, thus cutting costs and environmental impact.
Crisis Management
Hospitality firms use AI technologies to help them anticipate crisis events, respond quickly, and effectively communicate with guests to minimize risk to health and safety. For example, generative AI can dynamically create content to help hotel firms send personalized mass notifications about weather events that can advise action or evacuation as needed.
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30 Use Cases of AI in Hospitality
1. Chatbots and Virtual Assistants
Hospitality and travel companies are leading adopters of conversational AI tools. They’re used for:
- Booking assistance
- Handling on-property questions
- Technical troubleshooting
A recent study found that 70% of guests find chatbots helpful for simple inquiries and tasks, such as:
- Check-in
- Asking for Wi-Fi passwords
- Scheduling wake-up calls
As AI grows more sophisticated, hotels are banking on the ability of bots to power more complex digital concierge services. Some firms are starting to create brand-associated virtual assistants with different “personalities,” hoping to enable interactions with guests that lead to favorable connections.
2. Voice-Activated Devices
Whether through in-room smart speakers, concierge robots at the front desk, or smart kiosks scattered across a property, voice-activated devices are on the rise in hospitality. Approximately 40% of hotel leaders say that these devices are also among the most promising innovative technologies for their business in 2024.
Backed by AI technology that can answer complex questions, offer recommendations, control settings in rooms, and take orders for on-property purchases, voice-activated devices help hospitality firms provide white glove service even when staff are not immediately at hand.
3. AI-Powered Recommendation Systems
Hospitality firms use AI recommendations for personalizing guest experiences. Research shows that approximately 80% of hotels use, or plan to use, AI and data analytics to help them present guests with personalized offers.
These predictive recommendations can be incorporated into marketing campaigns tuned to customer segments, used at booking time, or on the property. When such tailored recommendations hit the mark with customers, they can boost revenue and customer satisfaction.
4. Smart Room Customization
Some 65% of travelers say they want the technology in their hotels to be cooler than the tech in their homes. So, hotels have amped up their cool factor with AI-enabled smart room customization. Using a combination of motion sensors, intelligent thermostats, voice-enabled devices, and smart TVs, hotels equip smart rooms to help cater to guest preferences.
Smart room technology can optimize settings for:
- Lighting
- Temperature
- Entertainment offerings
Some luxury smart rooms can even tailor mattress firmness for guests.
5. Smart Energy Management
Smart energy management systems in hospitality facilities pair up Internet of Things (IoT) telemetry with AI to monitor and automate control over key energy-consuming systems, such as:
- Heating
- Air conditioning
- Lighting
Smart energy management systems can help hotels optimize energy consumption to achieve sustainability goals and save money. They can also offer visibility about energy consumption trends to finance and maintenance staff so they can better plan for expenses and preventative repair, respectively.
6. Robotic Process Automation (RPA)
RPA is especially helpful in easing the path to intelligent automation for hospitality firms that are still modernizing their technology stacks. Often, hotels struggle to completely automate a process when its workflow spans multiple disconnected systems.
RPA does well with repeatable “swivel-chair” processes, such as copying data from one application to another or from multiple different systems to use in messages that are regularly sent to guests. RPA can also play an essential role in automatically transferring important information from legacy applications to AI-powered analytics and finance platforms.
7. Pricing and Revenue Management
Pricing and revenue management are crucial instruments for ensuring that hotels optimize their occupancy rates and profitability, and hospitality firms are using AI technologies to help refine them on numerous fronts.
Most apparent is the use of AI analytics to crunch real-time financial data and historical trends about occupancy, cost, and even weather patterns to help power better room pricing recommendations.
Maximizing Ancillary Revenue with AI-Powered Pricing and Insights
But AI can also help improve pricing and revenue management for hospitality companies’ many ancillary revenue streams through analysis of data from various departments and business lines.
Ancillary revenue streams include:
- Room service
- Meeting space rentals
- On-site restaurant and bar sales
- Valet and parking charges
- Vending machines
- Spa and massage services
- Gift shops
- In-room minibars and movie rentals
- And any or all of which a guest may use throughout a stay
8. Maintenance Prediction
AI can help hospitality firms stay on top of facilities upkeep through predictive maintenance algorithms.
Paired with IoT monitoring of equipment and infrastructure, like:
- Heating
- Ventilation
- Air conditioning systems
- Technology systems
- Elevators
- Vehicle fleets
- Lighting
Predictive AI can alert maintenance staff to potential problems before they become emergency repairs. It can also help optimize maintenance scheduling for regular tasks that can keep assets in working order for longer. This helps optimize operations and minimize downtime that could impact guest experience.
9. Facial Recognition Technology
Hospitality firms are tapping into AI-driven facial recognition technology to bolster their security and access control capabilities. Facial recognition can be used to verify identity upon check-in or in the case of lost room keys, or even for payment authorization.
It can also be used to identify unruly or troublesome individuals in crowded facilities who have a history of causing issues and need to be escorted off the premises.
10. Surveillance Automation
Physical security teams at hospitality facilities can do more with less with the power of AI-enabled surveillance systems. These systems monitor camera feeds, data from smart access systems, and even crowd behavior analysis systems to alert staff to potentially disruptive or unlawful activity on the premises.
Automated AI-powered surveillance makes it more cost-effective to keep tabs on what’s going on in facilities of all sizes by reducing the number of staff members needed to monitor cameras over the day.
11. Targeted Marketing
AI analytics play an essential role in helping to segment customers, map customer journeys, and conduct experiments like A/B testing to chart the effectiveness of different marketing strategies against specific audiences. This can increase bookings and repeat stays, and boost guest spending during their stay.
12. Sentiment Analysis
A combination of natural language processing and other AI-based analytics can help hospitality firms quickly sift through guest feedback and online reviews to identify key insights. Sentiment analysis can be used to shape future operational processes positively, personalize guest experiences, and optimize review analysis.
For the latter, many hospitality companies use AI to help them respond quickly to both positive and negative reviews, thereby managing their online reputation proactively.
13. Virtual Tours
Hospitality firms can harness the power of AI to create immersive virtual tours that help guests and event customers explore guest rooms, event facilities, restaurants, and more, allowing them to plan their stays and experiences confidently. Studies show that 18- to 34-year-olds are 130% more likely to book based on virtual tours.
Generative AI can accelerate the cost-effective creation of 360-degree virtual tours. AI also makes it possible to augment virtual tours with real-time updates about various features and locations, and even personalize information based on prior knowledge of a customer.
14. AR for Enhanced Guest Experiences
Hotels and resorts are growing increasingly creative in how they use augmented reality (AR) coupled with AI to enhance guest experiences. AR features built into mobile or digital maps, and menus can bolster engagement and offer advanced features like real-time translations and a virtual concierge.
Some resorts use AI for gamified experiences, such as treasure hunts that appeal to the young and young-at-heart. And some hotels have even gone so far as to provide interactive experiences showing AR portrayals of celebrity guests when a user points their phone at a point of interest on the property.
15. Automated Check-Ins
Hospitality firms are implementing smart kiosks and mobile apps enhanced with AI chatbots to automate guest check-in. The streamlined process makes it simple and convenient for a guest to verify their identity, obtain room keys (or download electronic keys to their smartphone app), and head to their room without a wait.
Automated check-in cuts down on the amount of staff needed at the front desk during peak hours by up to 50%, according to some estimates.
16. Real-Time ID Verification
Airlines are the frontrunners in deploying AI for real-time identity verification, but hospitality firms are following fast.
AI can speed up the process of scanning ID documents and biometrics to facilitate safe adoption of advanced practices like:
- Contactless check-in
- Keyless entry
- Digital payments
- Security assurance
17. Smart Kitchens
Hospitality firms are using a combination of kitchen automation, robotics, IoT, and AI software to power a new generation of smart kitchens that can significantly increase the quality, efficiency, and consistency of food service operations.
Smart kitchens are potential game-changers for on-site quick service restaurants, which can be challenging to staff but on which guests depend.
18. Robot-Assisted Cooking and Delivery
Hotels are not going to replace sous chefs and experienced servers at their fine-dining restaurants anytime soon. But for quick meals and room service, AI-driven cooking and delivery robots are gaining momentum for their cost savings and speed of service.
Cooking and delivery robots make it possible for larger facilities to extend room service hours and options, while opening up room service opportunities for smaller hotels that wouldn’t otherwise be able to staff food service operations.
19. Automated Cleaning Schedules
AI is helping hotels and resorts take their housekeeping capabilities to new levels of efficiency and productivity by coordinating automated cleaning schedules. AI can help optimize housekeeping schedules based on real-time data about occupancy levels, guest check-ins and check-outs, preferences guests have offered at the time of booking or the front desk, and predictive analytics based on historical trends.
This can help hotels optimize housekeeping labor, improving not only guest satisfaction but also the employee experience.
20. Robot Cleaners
AI-powered robot cleaners are increasingly seeing real-world adoption in hotels. They are augmenting housekeeping staff by performing repeatable and time-consuming tasks so that staff members are free to perform more of the complex tidying that needs human attention.
The most widely adopted AI cleaning technology is commercial vacuum and floor scrubbing robots trained on a facility’s floor plan and daily traffic flow.
21. AI-Enabled Event Planning Tools
AI is making it easier for event planners to streamline scheduling, logistics management, and customer support. Many event planners lean on AI to help them deliver immersive virtual experiences that are aligned with on-site activities.
Event planners also use AI to examine data for insights about attendee engagement with:
- Event facilities
- Features
- Speakers
The tech also opens up the potential for valuable added event services, such as real-time content translation and enhanced event security.
22. Crowd Management
Larger hospitality establishments, huge resorts, and event facilities can leverage cameras and AI software to monitor crowd density and space usage. The technology can help detect potential fire code violations or even unrest within crowds, sending real-time alerts to facilities personnel before problems escalate.
Some solutions even do heat mapping and crowd movement analytics to identify facility trends that can inform decisions about staffing and other operational scheduling.
23. Waste Reduction Algorithms
Major hospitality chains are using guidance from AI analytics not only to help reduce the amount of garbage they send to landfills, but to help reduce the amount of food and water that is wasted in the first place.
Waste reduction algorithms help hospitality waste-management experts plan out policies that optimize:
- Recycling
- Composting
- Reuse
Similarly, the algorithms can analyze waste audit data for opportunities to maximize efficiency and cut costs. On the food services front, waste reduction algorithms can help restaurant and beverage managers juggle perishable inventory, cut costs, and promote specific items before expiration. These efforts can support both profitability and sustainability goals.
24. Energy Optimization
AI can play a role in optimizing energy consumption in several ways, beyond powering smart energy management systems (described in No. 5). AI-enabled analytics that examine consumption data can help hotel managers identify energy-intensive devices and systems that may need to be repaired or refreshed to make them greener.
Analytics can also help operations and finance staff examine alternative energy sources and contracts that can make their energy purchases more cost-effective. AI can also play a role in helping to control and maximize the use of on-site renewable energy, minimizing the use of energy from the power grid.
25. Personalized Rewards
The days of random coupons that knock off a few percentage points here and there to reward frequent stayers have passed. AI makes it possible to tune reward options to a guest’s purchase patterns and preferences.
The result is highly personalized perks and offers that are more likely to encourage guests to stay more, spend more, and enjoy their experience more in the process. These consistently customized experiences built on AI foundations can help strengthen emotional connections with guests and drive repeat bookings.
26. Predictive Loyalty Engagement
Rock-solid analytics lie at the heart of every modern loyalty program, so it follows that AI is rising as an essential technology for improving loyalty engagement. Predictive analytics led by AI algorithms can take data about an individual guest’s behavior, or an entire customer segment’s, and help plan ways to gently nudge them into booking or spending more with well-timed recommendations.
Systems like these could ensure that a loyal guest who sometimes eats at a specific resort restaurant is offered a free drink for reserving a table when they book. Or another guest, who frequently stays at a property during concerts or other events, could be automatically sent a package offer for a marquee event.
27. Real-Time Translation
Hotels and resorts catering to international guests are enhancing guest experiences with real-time translation features across their mobile and on-property digital interfaces. AI has already advanced multilingual content generation. Now, it’s taking translation to the next level, real-time, which diminishes the language barrier during dynamic interactions.
This could include on-the-fly translation for booking interfaces and other digital portals, as well as for augmenting in-person interaction between guests and resort staff by running a mobile concierge app that listens and translates while each party speaks.
28. Creating VIP Profiles
Loyal customers might expect more personalized customer service than usual in return for their reliability as your top spenders. Rather than enlist a fleet of butlers or a dedicated support team to cater to VIPs, hospitality leaders can opt for an AI-driven tool to help personalize experiences effortlessly.
AI automatically flags customer profiles for VIP status once they’ve reached a particular milestone. It can use those VIP profiles to record preferences like room selection or amenity offerings to ensure each stay is convenient and comfortable.
29. Automating Room Service
No guest wants to wait around for room service; they’d like their order as fast as possible and expect the experience to be convenient. AI can automate the process of responding to room service requests. AI quickly scans the inquiry and analyzes customer sentiment, intent, and language.
Then, it responds with a personalized answer, like a list of today’s entree specials or pricing for the hotel spa. Once the customer makes a selection, automation creates and sends a ticket to the appropriate person or team.
30. Collecting Guest Feedback
Feedback and quality assurance (QA) in hospitality are what help businesses continuously improve at providing top-tier customer service. Four Seasons didn’t become a titan in the hospitality industry by guessing; its people listened to guests, made accommodations, and continually innovated.
AI in QA can elevate customer feedback collection by analyzing 100 percent of customer interactions and flagging negative or subpar conversations. Then, either the AI or a human agent can intervene to address the situation, and managers can use the opportunity to coach agents or change workflows to avoid it in the future.
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How to Get AI Value in the Hospitality Industry
Reimagining Hospitality Business Operations for AI
Hospitality companies must rethink business operations to harness AI’s full potential. This transformative technology will redefine the industry, and companies must be prepared to embrace the opportunities that arise.
To start, hospitality organizations should allocate dedicated resources, be it an individual or a team, to apply AI within their operations. This group should begin by broadening the company’s understanding of what AI makes possible.
Subsequently, they should collaborate with various departments to:
- Rethink operations
- Encompassing customer experience
- Loyalty programs
- Revenue management
- Distribution
- Back-office functions
Building the Infrastructure for AI Adoption
The development of an AI ecosystem is a foundational step for hospitality companies. This involves establishing four critical layers: AI platforms, data, AI models, and AI-enabled applications.
AI platforms are the bedrock, providing the necessary tools for:
- AI model development
- Training
- Deployment.
Data, both structured and unstructured, forms the core of AI, necessitating meticulous collection, cleansing, preprocessing, and annotation to ensure its utility. AI models are the engines of prediction and task execution. AI applications serve as the user interfaces that leverage AI models to deliver specific services and functionalities.
Ensuring Confidence and Trust in AI
Trust in AI is paramount. Companies must address potential AI risks and adhere to evolving AI regulations. Ensuring the reliability, privacy, and fairness of AI applications is imperative.
Establishing a comprehensive AI governance framework, complete with policies and procedures for AI usage, is essential. Robust cybersecurity measures are necessary to protect the enterprise.
The Future of AI in Hospitality
The future of the hospitality industry will involve even faster, more personalized customer interactions, all thanks to AI. We’re not far away from a world where 100 percent of customer interactions involve AI, and according to the Zendesk AI-powered CX Report 2024, AI will soon be able to resolve 80 percent of those without a human agent’s involvement.
Here are a few predictions for what’s next from AI in hospitality:
Proactivity
Using data and insights crawled from previous interactions and customer preferences, AI will be able to proactively predict and tailor unique guest experiences, like:
- Room amenities
- Dining options
- Local recommendations
Efficiency
AI will continue to improve hospitality services, helping businesses manage bookings, cancellations, and other inquiries faster and more effectively.
Novelty
Customers will have even more ways to access AI-driven services in the future. For example, AI-supported augmented and virtual reality applications and integrations could allow customers to tour amenities before making a reservation.
Security
AI-powered encryptions already use algorithms to enhance safety for guest information. Still, in the future, these could also be applied on-site to manage and monitor hotel access to keep guests safe.
AI and the Future of Customer Experience in Hospitality
There’s no telling just how many facets of the customer experience AI will affect in the future. In our AI-powered CX Report, we also discovered that 87 percent of CX leaders expect AI to usher in a full-fledged CX evolution by 2027, and hospitality businesses that adopt CX-driven AI tools can now develop a competitive edge before then.
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