THE TRAVEL CATALOG PARADIGM
Who does not like flipping the pages of travel catalogues? The thickness of the paper, the (over)photoshopped pictures of golf courses, sunny beaches, ski facilities and pyramids excursions in no apparent logical order. It is a post-modern experience and, even if travellers end up with a headache, chances are that they can always find what they were looking for in a catalogue. The downside is that, in order to get to that perfect, tailor-made offer, they have to flip over hundreds of pages. The main problem with travel catalogues, therefore, is not the absence of personalized offers, rather their poor UX. Nonetheless, our Industry struggles to get out of this catalogue-based mentality. Why?
HOW SOON IS NOW?
“Today’s impatient consumers want things in the moment they need them", says Lisa Cohen Gevelber, Global VP Marketing at Google, "which is typically now”. Travelers are getting increasingly impulsive in areas where (over)planning used to be the norm, and the shift is mainly due to the fact that it is way easier to access hyper-personalized offers in real-time. Instead of overwhelming potential customers with terabytes of irrelevant offers, in fact, hotels today can easily offer the right content, for the right customer, during the right moment of its journey. Just think about the rise of automated conversational marketing.
MESSAGE PERSONALIZATION: CHATBOTS & HYBRIDS
According to a Brafton survey, the average time spent on a website is 2' 17", and travellers have become increasingly volatile: if they don’t find answers to their questions in this amount of time, then they go searching somewhere else. Chatbots can help to guide the customers in their journeys by offering a hyper-personalized, frictionless experience and a faster, better connection with the brand. NLP advancements have made it possible for bots to reach a level of sophistication that was unthinkable only five years ago, and by automatizing trivial conversations whenever possible, hoteliers can focus on what really matters: their guests.
RATE PERSONALIZATION: 1:1 APPROACH
Stepping out of the over-simplistic best-rate-guaranteed strategy to a more 1:1 rate approach is also crucial. Travelers are smart and they want to be treated as such. The use of AI is revolutionizing not only the way hoteliers interact with their customers, but the way they price their products as well. Hoteliers cut rates when the pickup is low and increase them when it is high, but guests are rarely added to this secret formula, so that price personalization remains a chimera. But there’s literally an ocean of unexploited possibilities out there, and hotels should tweak and adjust their offers to match each customer unique habits and inclinations. And no (human) revenue manager can hold in his head the enormous number of variables that shape users’ behaviour. There is, simply, a level of accuracy and speed that humans alone will never be able to achieve.
Otherwise, thanks to the latest advances in machine learning, it is now possible to predict user behaviour on a hotel brand’s website in real-time, then automatically personalize his experience with the most appropriate message, content or offer. The adoption of Attribute-Based-Shopping models by brands such as Marriott could even speed up this transformation, leaving the price strategy in the sole hands of robots. "Any sufficiently advanced technology is indistinguishable from magic”, the Third Law of Arthur Clarke states, but with AI becoming the standard in so many areas of our life, it is slowly losing its supernatural status. AI is mainstream, whether our Industry likes it or not.
THE DATA PARADOX
So, if the goal is hyper-personalization, then the Industry should prepare for hyper-automation. But it’s clear that, in order to create a real hyper-personalized guest experience, hoteliers should set processes in place as well. There’s no way to use a plug & play approach when it comes to personalization, so data becomes essential. Without proper data enabling AI to run its magic, then no automation is possible. And here's where things get complicated, as hotel data are (more often than not) stored in old-school, on-premise PMS, unable to communicate with other systems. "Artificial Intelligence systems are only as good as the data we put into them," notes an IBM study on human bias in AI systems, and the traditional PMS could rarely be trusted in handling this delicate task correctly. This is changing with the advent of affordable cloud-based PMS that allow their wealth of data to be shared with other Hotel technology providers. If we really want to get our Industry out of the 20th Century, we should start valuing our data as the most precious marketing tool we have and using it appropriately.
CONCLUSIONS
AI-driven personalization is used already in a myriad of industries, from music and video entertainment to e-commerce. Some analysts have examined the dangers of a new dotcom bubble in AI. The difference, though, is that companies do not invest in AI because it’s cool, they do it because it is efficient. Just ask Spotify, Netflix or YouTube. We all know too well that Hospitality is a lazy Industry when it comes to technology adoption, but it's time to change. Otherwise, we'll just stick with travel catalogues. The above article was written by CEO & Founder at HotelTime Solutions, Mr Jan Hejny. If you would like to reach out, be sure to check out his LinkedIn profile here!
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