Travel predictions: Breaking down walls, AI and revenue optimization

This article first appeared on Phocuswire

This past year has brought about many surprises, but as technology continues to advance, significant changes are happening in our industry. My time on the road provides a unique opportunity to gather information from some of the greatest minds in our industry in 2023. Through our ongoing commitment to support innovation, we see an advancement in the breakdown of data silos, an expansion of revenue management beyond the confines of hotel walls, the rise of generative artificial intelligence, and an ongoing resurgence of meetings and events.

As we look ahead at 2024, it appears the new year is shaping up to bring about substantial and exciting changes — and the best way for hoteliers to take advantage of that change is to start thinking now about what’s likely to come in the year ahead.

The breakdown of hospitality data silos

The hospitality industry collects an incredible amount of valuable guest data, but it often comes from disparate sources with no clear view of the entire guest experience. We foresee this changing fast as hoteliers look to maximize the value and power of their data in 2024. To make the most of their properties’ data, hoteliers will need to evaluate their overall technology stack and consider their options for effectively bridging the gaps between these walled-off data sources.

This progress will continue in 2024 as more organizations embrace cloud-based data platforms, and hoteliers understand the value of ensuring their technology systems work well together. For hoteliers, this breakdown of data silos means a much more holistic and clearer view of their guests’ total profit potential, bringing the importance of cross-departmental decision-making into acute focus.

It also supports the advancement of a “connected commercial organization” where revenue management, sales and marketing are aligned and working toward a shared set of goals. Instead of repeating a constant cycle of conflicting actions and tactics stemming from misaligned metrics (and the bonuses tied to them), hoteliers will take significant steps to realign their businesses to a connected commercial model that prioritizes profitability over everything.

AI set to redefine guest experience

2023 was undoubtedly an attention-grabbing year for generative AI, with tools like ChatGPT, Bard, and DALL-E generating scores of headlines and high-minded think pieces about the implications of their widespread application. In 2024, we believe generative AI will stay in the spotlight. Still, the focus will shift away from far-flung philosophical debates to seeing how these technologies will start reshaping the hospitality industry (among others).

It’s clear that generative AI has great potential to streamline and improve how hospitality providers handle the tedious tasks on their to-do lists. We’re already seeing how this technology can be applied in marketing, sales, communications and data platforms — and that practical applications are just getting started. We expect this targeted adoption of technology to steadily reshape what “business as usual” looks like for today’s hoteliers.

Take, for example, the use of generative AI in a customer service call center setting. Generative AI-driven chat can make quick work of a huge portion of routine customer needs and serve as a front-line filter for guests who just need a little help getting pointed in the right direction. With the ability to detect key phrases and categorize sentiment, AI can evaluate, escalate and route guests to the right people for tending to more complex problems. When done well, this approach can improve operational efficiency, the speed of issue resolution and overall guest satisfaction.

Revenue management leaves confines of hotel walls

The discipline of revenue management is poised to expand beyond its traditional home within hotels. Campsites, “glamp-sites” and other forms of outdoor accommodations remain incredibly popular. With at- or above-capacity, alternative accommodation operators are looking over the fence at what their similar-but-different friends in hotels are accomplishing with revenue management practices; we believe it’s only a matter of time before this discipline starts stepping out — and up — to meet the needs of these markets.

Additionally, with cloud computing technology and mobile applications providing increased flexibility for how and where revenue managers tend to their business, the discipline of revenue management is poised to get out and about more than ever before.

A renewed focus on meetings and events

Forward-thinking hoteliers understand they need to look beyond room revenue to maximize the value of their property. With as much as 60% of hotel revenue originating from meetings and events (M&E) business, this business segment is the next hill to conquer on the path to a total revenue optimization future. A hotel’s revenue maximization success depends on a cohesive M&E strategy that aims to ensure every square foot or meter of event space is used to its full revenue-generating potential — and we believe more hotels are ready to branch out into their next revenue management frontier in 2024.