"There’s always an initial resistance to new technologies, especially when people have been successful using traditional methods,” said Michael Goldrich, who spent more than 20 years in senior hotel marketing positions before founding Vivander Advisors, a company that helps organizations harness the power of AI to achieve transformative growth. Yet, he says, it’s important to adopt new technologies, particularly AI, which he sees as the biggest technological advance in decades. “AI isn’t something to be feared, but rather something to be embraced. Once you learn how to use it correctly, it can revolutionize your business. And you want to be in a position to direct the technology rather than being directed by it.”

Michael Mahar, senior vice president and head of commercial technology, loyalty and digital products at Wyndham Hotels & Resorts, agrees. “Any time there’s transformational change involving technology, it’s met with fear,” he said. “We saw that with the introduction of the internet, with the introduction of cell phones, and we certainly see it with the introduction of AI. But leveraging AI can enhance the employee and the guest experience, allowing hotels to increase productivity, focus on operations and growth, and meet guest needs more effectively

Value for guests and staff

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Wyndham Hotels & Resorts was an early adopter of artificial intelligence. “We embraced the technology early on, right after ChatGPT,” said Mahar, noting that the company formed an AI steering committee to help bring use cases to production quickly. Its Wyndham Connect Platform is built on open AI, which is the same back-end large language model as ChatGPT.

One of the platform’s key benefits is that it removes workloads and strain from front desk staff. “We want employees to focus on interactions with the guests who are standing in front of them rather than having to take phone calls,” he explained.

In its contact center, Wyndham uses artificial intelligence to measure customer intent in real time and guide agents through conversations. “AI is helping agents see ‘next best actions’ so that they not only acknowledge the needs of our guests but also make the right offers at the right time.”

AI also helps the company speed up the contact center onboarding process and decrease agent turnover. “Historically, agents have become frustrated with the learning curve, so this has been a great staff retention tool for us.”

Another enormous benefit of AI at Wyndham is the removal of friction for hotel guests. Using the Wyndham Connect Platform, guests can look over their itineraries, view check-in times and see confirmation numbers. The platform also welcomes guests to the hotel and responds to questions in a friendly and conversational manner. If the AI platform can’t answer a question, Wyndham loops in front desk staff who use the same solution to interact with customers.

Similarly, BWH Hotels is using AI and machine learning technologies to transform key operational areas—from property management to cybersecurity. According to Harold Dibler, vice president of technology, AI-powered solutions are transforming the business. “AI is a game-changer, ushering in a new era of efficiency and innovation.”

In guest services, BWH is leveraging large language models to automate responses to frequently asked questions, such as inquiries about check-in times or hotel amenities, which improves the guest experience by ensuring timely and accurate communication. AI also interprets and routes maintenance and guest requests to the appropriate staff members, streamlining operations and enhancing service delivery.

In the area of cybersecurity, BWH uses AI to detect and block malicious activities, safeguard data and ensure secure transactions. AI and machine learning also enhance software development. “Real-time AI suggestions streamline coding processes, promoting efficiency and quality,” Dibler said.

Additionally, BWH uses AI-driven call center analytics and sentiment analysis to gain insights into guest behavior and emotions, which enables its hotels to offer more tailored responses. In much the same way, Eric Segreti, vice president of rooms at Fontainebleau Miami Beach, routinely employs AI to gather information on customer preferences. “From in-room amenities to food and beverage service, AI allows me to quickly pull data regarding all aspects of the hotel experience,” he said. “I can then take that data to executive meetings so that our leadership team can have an informed discussion based on both the guest experience and the operational perspective.”

Untapped opportunities

Canary Technologies, a leader in the AI revolution, produces solutions that are used by both Wyndham and BWH. "Artificial intelligence is a popular topic, and rightfully so," says Bryan Michalis, head of marketing and business development at the company. "There are so many ways hotels can harness AI to boost revenue, increase productivity and elevate the guest experience."

Canary’s AI solution can automatically respond to 80 percent of guests messages, he says, saving understaffed hotels a lot of time while providing their guests with immediate responses. It also understands guest requests and automatically creates service tickets, ensuring a fast and seamless handoff to staff members.

Anna Jaffe, CEO at Mobi.AI, a collaborative AI platform that helps businesses optimize and automate operations, sees untapped opportunities for hotels, beginning with the search for rooms. “Hotels have talked for a long time
about wanting personalization but said it was impossible because travel is too contextual,” she said. “Natural language search solves this dilemma. Guests will tell hotels exactly what they want—a room with a view and nearby Michelin dining, for example—and the hotel will be able to deliver.”

Jaffe notes that AI can also be used to build guest loyalty based on deep emotional ties. “Most hotels are good at using a point system to encourage guest loyalty, but emotional loyalty means someone will stay with you even if it’s a bit inconvenient or a little more expensive because they trust you to take care of them,” she said, adding that historically only the luxury brands have excelled in this area. “Now, AI makes emotional loyalty accessible to everyone, because the world data needed to scale a luxury hotel concierge is available to every colleague.”

Another AI-related opportunity for hotels lies in basic service delivery. A prime example, Jaffe says, is intelligent room selection and assignment. “AI enables guests who want quiet rooms, excellent views, or upgrades when a particular room type would otherwise sit open, to get those things based on their status, recent experiences or willingness to pay.

It’s a total miss to put the guest who hates noise and loves darkness in the loud room with the great view,” she said, adding
that there are dozens of other similar use cases where AI can improve guest service and satisfaction as well as profitability.

Not without its challenges

Although AI can benefit hotels in almost every area, it’s not without its challenges. “Adopting AI isn’t just about harnessing new technology; it’s about doing so responsibly,” Goldrich says, noting that it requires informed approaches coupled with clear guidelines and policies that mitigate potential vulnerabilities. (See sidebar, page 24.)

“Policies remove uncertainty and provide a roadmap,” he said. For example, if the hotel marketing department allows staff to use the technology only in specific ways or in certain departments, the AI policy should clearly state that information. “The point is to help staff leverage the technology without putting the
hotel at risk.”

Another challenge surrounding the use of artificial intelligence in the hospitality industry is the potential loss of the personal touch. “Hotels can get into trouble if they rely too heavily on AI,” Goldrich acknowledges, noting that the goal in deploying the technology should be to automate tasks rather than replace staff. “Keeping humans in the loop is critical to success. AI can reduce or eliminate tasks that employees dislike, which gives them the freedom to focus on guest service.”

And while AI can enable low-skilled staff to operate with high productivity, it also can create challenges in terms of experience. “Never underestimate the value of ‘battle scars’,” he said. “Wisdom isn’t easily replicated by technology.”

Still another AI-related concern is cybersecurity. Although the technology can equip hotels with the advanced tools to detect, prevent and respond to threats, it also enables cybercriminals to escalate attacks. “AI’s widespread availability has allowed hackers and other cybercriminals to ramp up the volume and sophistication of their attacks to unprecedented levels,” said Daniel Johnson, CEO at Venza, a leading data protection company to the hospitality industry.
He cites such free AI-powered tools as WormGPT and FraudGPT that make it easier than ever for cybercriminals to launch large-scale fraud schemes.

Hotels should implement multi-factor authentication solutions to add additional layers of security and make it more difficult for cybercriminals to gain unauthorized access to systems. Additionally, employees should be warned about the dangers of phishing and social engineering attacks and instructed on the importance of verifying the authenticity of digital communications, especially those requesting sensitive information. “Employees are your first line of defense against threats, and training them is the easiest way to boost your cybersecurity efforts,” he said.

Education is key

In fact, staff education is central to ensuring that the hotel gets the most from its AI investment. “Education matters when it comes to the proper execution of AI projects,” Jaffe said. “Few people understand what AI is, and it’s almost impossible to use something you don’t fully understand.” Goldrich agrees, noting that repetition is key. “Education is so much more than a once and done exercise,” he said, noting that employees must understand the complexities of AI and stay informed of the latest developments, which involves continual learning sessions as well as the fostering of a culture of collaboration.

Additionally, making AI part of the daily routine is fundamental, he said, citing research by Microsoft that found that employees who used the technology for just 11 minutes a day for 11 weeks started to build an AI habit. Moreover, the research— known as the ‘11-by-11 tipping point’—showed that participants saw improvement in four key areas: productivity, meeting relief, work enjoyment and work-life balance.

He suggests holding a weekly AI meeting for 11 consecutive weeks. At each meeting, review the AI-related tasks that staff tried during the previous week. “Discuss what worked and what didn’t. Then, teach something new and ask employees to try it out for a week.” After 11 weeks of continually using AI, employees will not only incorporate the technology into their daily routines but also will come to embrace it. He also suggests training staff to identify AI use cases that have high value and minimal risk. “Projects that drive the most value for staff will also drive value for the business and will help the hotel achieve the promise of AI productivity.”

Artificial intelligence (AI) is unquestionably the most transformative technology of our time; but for all its promise, it is fraught with legal and ethical risks. Here, Erin Snodgrass, an attorney with Foster Garvey inSeattle, discusses some of the top concerns surrounding the use of AI in the hotel environment.

1. Privacy

Privacy is an enormous AI-related concern. Transparency is required if the hotel uses an AI tool in any of its guest-facing interactions, said Snodgrass, who frequently represents hotel clients and is an expert on AI in the hospitality industry. “Guests have a right to know what kind of information is being collected about them as well as how that information is being used and by whom.” She also advises hotels to find out if their technology vendors are using AI; and, if so, what kind of data the solutions are capturing.“When embarking on vendor agreements, be sure to do your due diligence,” which includes assessing vendors’ cybersecurity practices. Be sure, too, to include cybersecurity clauses in vendor contracts, including breach notification timelines and liability coverage.

2. Security

Some AI tools connect back to the internet, which exposes the hotel to security risks. In addition, a number of AI models are ‘black box,’ meaning their internal workings aren’t transparent. “AI tools scoop up everything, some of which might present a security risk,” Snodgrass said. She advises hotels to evaluate all systems for vulnerabilities and identify models that handle sensitive data, such as guests’ personal information and payment details. Implement encryption protocols and make sure AI systems that handle guest information are compliant with data protection regulations. Also, anonymize or pseudonymize data within AI models to reduce the impact of potential breaches.

3.Confidentiality

Depending on the AI tool the hotel is using, the prompts may not be confidential.“Hotel employees are putting all kinds of information into ChatGPT and other tools, and that information may not be protected,” she said, adding that ongoing staff education is critical in this area. “Most people don’t realize that prompts aren’t confidential, and the outcome can be devastating. Investing in AI literacy goes a long way toward mitigating confidentiality problems.”

4. Intellectual property

Although it may seem like AI tools are conjuring up new material from thin air, that’s not the case. AI platforms are trained on enormous archives of images and text.
“If the hotel marketing team instructs AI to generate an image for the property’s next promotion, the image they get might well be the copyrighted material of a third party, ”Snodgrass said. Legal issues around the use of AI are still emerging, as can be seen by the number of recent lawsuits being brought against Open AI and Microsoft over alleged copyright infringement. “No one knows how these cases will be settled, but hotels should be aware that if they’re using AI to create text and images, they may not be protected.”

5. Accuracy

Accuracy and reliability are also big concerns, as AI often generates false information. “You might ask AI a question and receive a very confident response that just isn’t true; or AI might tell you what it thinks you want to hear based on the prompts you’ve provided,” she said. Hotels should keep that risk in mind when using AI for any type of task, from coding to generating marketing text. “AI isn’t a critical thinking tool. It’s scraping everything on the web, so do your homework and check the accuracy of its findings.”

6.Bias

Similarly, AI has been shown to be prone to bias. “Because AI gets its information from the internet, it often perpetuates the same prejudices that are seen in society at large,” she said. The problem is most often apparent in the human resources department.“When it comes to HR, there’s a delicate balance between AI’s potential and its pitfalls.” If the hotel uses an AI-powered HR screening tool, be vigilant of possible bias as well as other ethical concerns. Snodgrass notes that governments around the world are enacting legislation surrounding AI. Earlier this year, the European Parliament adopted the Artificial Intelligence Act, which provides rules on data quality, transparency, human oversight and accountability. And in the U.S., a number of states are looking at AI legislation, which focuses on the transparency requirements around data collection as one of the primary areas.“AI is a major paradigm shift,” she concluded. “It has the potential to drive innovation and unlock new opportunities, but it must be accompanied by responsible oversight and ethical considerations. And that’s where legislation is heading.”

The future of AI

Artificial intelligence will only continue to advance, says Goldrich. Already, it has transitioned from a search-based paradigm like Google that requires users to scroll through links for information, to an answer-based paradigm like ChatGPT that responds directly to user queries.

The AI systems of the future will be goal based and will utilize AI agents to achieve specific objectives. Once prompted, AI agents will learn from data, make decisions and carry out actions autonomously, all without further human intervention. Consumers’ AI agents will know where they want to travel, how they want to get there and what they want to do after arrival, and they will take care of everything from booking flights and hotel rooms to finding local entertainment. Similarly, hotels will utilize their own AI agents to negotiate with guests’ personal agents.

Within a few years, Jaffe predicts, the hospitality industry will have a sharper picture of artificial intelligence. “Everyone will be able to see AI as clearly as they do the tools in a toolbox,” she said. “They’ll understand what is and isn’t possible and they’ll know which techniques to use in certain situations.”

That clarity will usher in a new era of hotel growth and profitability. “AI was built to optimize for a static world, but travel is dynamic,” she said, noting that inventory, prices, customer preferences and weather conditions are constantly in flux. “Right now, hotels are missing some big opportunities, but that will change in the near
future.”

In the meantime, Goldrich advises hotels to embrace AI literacy. “It’s important that everyone is equipped with the knowledge and skills they need to understand AI and use it safely, ethically and responsibly,” he concluded.

“AI literacy is the single biggest strategic initiative you should undertake. It will prepare you for everything that’s coming.”

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