Part I: AI, facial recognition and hotel robots march into 2019
In the first of a two-part article Sally White looks at how some of last year’s defining moves in the hotel space are continuing to play out this year
‘Please smile at the screen – your face print is being scanned to pay your bill!’ - yet another example of the way robots can service hotels, although not yet at international groups. Instead of whipping out your wallet, identification is processed online in a Chinese pilot programme launched by Alibaba’s Ant Financial to replace payment with cash or credit card.
Chinese guests at two Chinese Marriott hotels, Hangzhou Marriott Hotel Qianjiang and Sanya Marriott Hotel Dadonghai Bay, started last year to use facial recognition technology to check-in. It’s something that Japan Airlines is investigating too – see a recent free EyeforTravel white paper which considers how the Japanese Carrier, Allegiant Air and Wyndham are using AI and other new technologies to grow their business. The Chinese hotels’ partnership is with Alibaba’s travel service platform, Fliggy.
Globally, by 2020 travel is expected to have the highest percentage of online payments of any industry, finds a report by Canada-based estate agency Colliers International. It continues that the next generation of technology is moving across the hospitality industry, with facial recognition, virtual reality and biometrics expected to be mainstream by 2025. Artificial Intelligence (AI) will play an important part, not just in personalisation and experience enhancement but in management and data handling. AI, says the report, is “anticipated to increase hotel revenues by over 10% and reduce costs by more than 15%…” These savings can be made as the research estimates that “73% of manual activities in the hospitality industry have the technical potential for automation”.
- 73% the manual activities in hospitality that could be automated
- 13% how much AI is expected to reduce costs
- 10% the rise in hotel revenues anticipated as a result of AI
Dressed to impress
Marriott, Hilton and Accor, for three, are already investing in this transformation. India’s fast-expanding international Oyo Rooms’ hotel network, which announced plans to add 2,000 technology experts to its existing team of 700, must be a prime candidate to join them. (Oyo CEO and founder Ritesh Agarwal is a rare hotelier, dropping technology names in interviews, such as ‘Krypton’ apps and ‘Orbi’ intelligence tools, as readily as those of target cities.)
Marriott’s robot crew ‘Cleo’ and ‘Leo’ manage guests. (A metre tall and dressed to impress with nametags, and coat tails, they have caused a stir.) Hilton has ‘Connie’ the concierge, developed with IBM. Yotel Hotel’s robot ‘Yobot’ manages guest luggage. UK electronics group LG has a robot which will do the lot - serve food and drink, handle baggage and provide directions. The sale of public relations robots, says Colliers, will have reached 66,000 by 2020.
But not all brands are convinced by the rise of the robot. “I’ve had loads of people come to talk to me about robots and all sorts of things, but for me it takes the personality out of hospitality,” Rob Paterson, CEO of Best Western Hotels & Resorts told EyeforTravel in another recent white paper – Cracking the Customer Experience.
I’ve had loads of people come to talk to me about robots and all sorts of things, but for me it takes the personality out of hospitality
Rob Paterson, CEO of Best Western Hotels & Resorts
Having said that, Paterson, who will also be speaking at EyeforTravel’s Digital Strategy Summit, believes there is “absolutely a place for automation”. But for the moment, it’s for the “basic transactional stuff” like questions into the call centre about parking and or finding directions to the hotel.
Cost control is vital against the current background of global economic uncertainty, though real estate service group CBRE’s Hotels’ Americas Research report sees the supply of new hotel rooms in the US peaking at a 2% gain last year, easing competition. It forecasts stability at the long-run average of 1.9% for the next two years. “The number of new projects entering the pipeline is declining,” it states. Against this, it has pencilled in a lodging demand rise of 1.9% for 2019.
US business travel figures eclipse those for Europe according to bankers Morgan Stanley’s Alphawise Global Hotel Corporate Travel Survey. Comfortingly, it found that business travel budgets generally are on the rise, with 67% of those questioned expecting an increase against 63% last year. Globally, the figure for room rate rises produced by the survey is 2.2% (against 2.3% in 2018), with 1.4% for Germany and France and 2% for the UK. Asia is expected to see room rates up 1.9%, and Latin America by 1.1%.
On RevPar, among the major groups, however, the US performance has trailed, with Hilton Worldwide, for example, seeing its US figure coming in at around 2-2.5%, while Europe has been at mid-single figures. Asia-Pacific is expected to deliver mid-single-figure growth in 2018 and China around 11%. Looking into 2019, Hilton “remains positive” on growth across its operations, with a figure of mid-to-high digits.
Join us at the Digital Strategy Summit (May 21-22) to hear more from Rob Paterson, CEO, Best Western Hotels & Resorts as well as the likes of Uber, NH Hotels, Zoku and Center Parcs