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The Future for AI and Revenue Management in Hospitality

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The applications through technology are evolving daily.

The renaissance of Artificial Intelligence (AI) – after a stalled start – offers advancement, reliability, security and efficiency.

Speaking specifically about revenue management in the main related industries - hotels, travel, cruises, car hire, airlines etc. - AI offers many advantages to general managers and the revenue management team. In hotels, for example, AI offers the management team cost savings, speeds up the analysis work and eliminates human error, so does that mean revenue managers can be replaced by technology in the near future? Will humans soon be redundant?                    

In our opinion, replacing a personal service by a bot is a long way away. Yes, there are some repetitive actions that computers are better at and can provide a refined, cohesive service but there are some actions where we doubt if computerisation can ever replace professionals.

Let’s look at some examples of where tech is helping hospitality:

Customer Service

There’s already examples of AI and bots able to process and react to uncomplicated customer service commands, for example, directing customers to nearby tourist attractions. The key word in this paragraph is ‘uncomplicated’. The nuances of an advanced customer conversation are still beyond most AI unless a disproportionate amount of money is spent on it. There’s an argument being debated by some technologists that the more customers talk to AI, the better and more responsive the AI will become. Connie at Hilton is an example here but often humans are needed behind the tech. However, many customers are still happier talking to a human rather than the available technology. Will Gen Z or Gen Alpha drive forwards the use of technology as opposed to human conversation?

Opinion Data

AI is very good at the automation of routine processes and management of large data volumes that can come from them so data captured from post-stay questionnaires, surveys or loyalty card information can be used quickly to understand its conclusions and implications.


Today’s AI technology has been shown to be extremely effective when it comes to direct messaging and online chat services, responding to simple questions or requests – through websites and social media. The initial significant impact this has shown is the availability of the answers for customers anywhere in the world – 24/7, 365 days a year – without having to pay a human. Like the customer service example above, the more the tech is developed and used by customers the better the AI will become.

These examples are early examples of how AI technology can influence the hospitality environment. Yet, these are repetitive tasks – where a human touch and stimulus is NOT required. Management decisions and the strategy of revenue management, where no two conclusions are the same, is where AI cannot help. Yet.

Machine learning will get better and further strides will be made. In our opinion, revenue managers and analysts should be excited by the Big Data extracts the machines will offer. Technology will make business more refined and coordinated – for instance, helping them to understand better the channels of their bookings and hence revenue. Can hotels learn enough through AI to change their strategies from being heavily reliant on OTAs to pushing more direct bookings? This isn’t about technology replacing humans but humans using it to make better decisions for the business because they aren’t having to do as much time-heavy data work.

Hospitality is a human based industry and always will be to some degree. AI can manage data better, quicker and more accurately so let it do this. Let it use the knowledge that it builds, learning from the initial human input that will be needed, learning from its own mistakes (so it doesn’t make them again) and AI will go on to optimise the pricing decisions better than any human.

However, humans won’t be replaced. Let us focus more on strategic decisions using the patterns and trends that AI has highlighted to us earlier and quicker. Humans will be allowed more time to create, implement and tweak strategies that are more proactive and predictive rather than the current reactive nature of the industry.

The job of the revenue manager will change for the better. It will be more commercial, more strategic, more interesting. Talent will still be needed!

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