Operator calling. Will hotels pick up?

GLOBAL REPORT – Last year, ChatGPT burst into our lives offering a new opportunity for greater efficiency across the world of work and, potentially leisure. For the hotel sector, this has so far meant a few more chatbots, but not a great deal more, until the launch of Operator, the latest offering from OpenAI.

Operator is the most relevant AI product yet to our sector, offering up the chance to book travel. The initial trial includes a collaboration with Priceline and the preview saw a user ask it to ‘find and book me the highest-rated one-day tour of Rome on Tripadvisor,’ but these are early days in terms of who grabs the consumer. You could instead just ask for a great hotel in the Maldives; a budget-friendly hotel in Australia; a hotel specializing in vegan food in Liverpool.

Users can specify favored search sites, such as Booking.com. Or they can choose ‘all sites’ and let the search take it where it may.

Is this an opportunity for hotels to take back control? Or are they destined to be late to the party and be overtaken by the OTAs, who have already partnered in the trial version of Operator? On Hilton’s most-recent earnings call, CEO Chris Nassetta was asked by analysts whether he would be happy for an OTA to handle the group’s distribution through agents such as Operator, and whether he saw it as good or bad news for Hilton.

He replied: “We obviously want to deal with our customers as directly as we can. We do have a percentage of our business that comes through the OTAs - it’s a relatively small percentage of the business… but the very large majority of our system is driven through our direct relationships.

“We’ve done a huge amount of work in how we think about every element of the relationship we have with our customers; from the first time that they dream about a trip, to exploration of where they want to go, to the booking experience, to putting their package together to, pre-arrival, on stay, post-arrival, every element of it.

“We are super engaged in how we use tools and technology, including AI and every step of that journey to make it a more pleasant and friction-free experience for our customers.

To benefit from this, hotels must ensure their digital presence is optimized, to feed the AI search with fresh, original content and data. Reputation will be everything. So, encourage positive reviews, respond to guest feedback, and cultivate an engaging brand image.

Alex Sogno

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“And so no, we don't plan to outsource that. We’re all over it.”

The CEO confirmed that he might work directly with the likes of Operator and certainly didn’t want to do so indirectly.

For Nassetta and Hilton, the beauty of AI so far has been from a data and analytics point of view, to understand in great granular detail what individual customers want and then to customize the experience, both ahead of stay, but particularly on stay.

Which takes us back to how Operator will work. In the early days of the internet, the most attention went to the most relevant. Then the internet was monetized and became pay to play. Those with the most money were highest up the search results. There are hopes that we are seeing a reset, that hotels can simply draw on their existing internet presence to ensure that Operator finds them first.

To benefit from this, hotels must ensure their digital presence is optimized, to feed the AI search with fresh, original content and data. Reputation will be everything. So, encourage positive reviews, respond to guest feedback, and cultivate an engaging brand image.

Hotels also need to double down on their direct distribution, using the data they - as at Hilton - have harvested. By creating a personalized offering, a hotel can build an experience to rival that of an OTA. Hotels who are part of a loyalty program should draw on the additional information available to them through these.

The reality, many suspect, is that the OTAs, who have had decades in dominating online, will simply use AI to make themselves even more powerful. What seems the most likely is that, given that AI has cost an awful lot to get this far, money will talk and whoever pays the most will get to the top of the search.

But before you start looking down the back of the sofa for extra marketing budget, remember: at this point, it’s still all to play for. Stay agile, stay informed and you might just stay ahead.

Contributed by Alex Sogno, CEO, Global Asset Solutions, London

The views and opinions expressed in this content do not necessarily reflect the opinions of Hotel Investment Today by Northstar or Northstar Travel Group and its affiliated companies.