Navigating the fallout from COVID-19 will require hospitality brands to adopt an agile, data-driven approach.
COVID-19 has presented a serious obstacle for most businesses, but few have been impacted as devastatingly as the hospitality sector. According to the AHLA and as of June 2020, hotels are projected to lose $400 million in room revenue each day. Nearly 6 out of 10 hotel rooms are empty. And this figure doesn’t include hotels that have closed completely during the pandemic. Nearly 70% of direct hotel employees (about 7.7 million) are laid off.
Things are slated to get better, albeit slowly; Hotel News Now reports that while demand, occupancy, average daily rate, and revenue per available room are all falling sharply, 2021 will see the start of a long climb back to normal. We’re already seeing increased activity on hotel websites as regions relax travel restrictions. As they feel safer, people will slowly lose the lockdown mindset and begin traveling again. But there will be a difference – the much-publicized ‘New Normal’.
How will your property respond to changing customer demands? Traditionally, this industry has been slow to adopt new technology. However, the current economic pause is giving us a chance to take stock of what needs to be done for the future. And that means using AI to gain insight into customer behavior and trends.
In this article, we’ll look at three areas where AI can help the hospitality industry overcome the COVID fallout.
Faster Information Access, Faster Decision-Making
Hospitality companies are facing some tough decisions now, and there will be more in the future. How will we figure out potential demand during an unprecedented set of circumstances? What about staffing needs? Will teams have to be reconfigured?
And then there’s the guest experience. Will people still want meal service? Will touchless check-ins/checkouts be the New Normal? What kind of tech support will we need?
Any pre-COVID marketing plans are now obsolete, and guest personas might be outdated as well. Previously, hotels mostly catered to business travelers, but with the rise of Zoom meeting and remote work, will business travel be as common?
And then there are the economic factors. Will price point become the most important thing for guests? Will there be new health and safety measures required?
The only way to deal with these questions is to use data. Brands that respond fastest to changing customer behaviors and industry trends will fare the best. So, getting rapid access to relevant data is critical; it will enable faster decision times, which will allow you to agilely respond to the above scenarios – and the ones that we haven’t even imagined yet.
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Putting AI Insights Directly to Work
A key step in making faster decisions is getting insights into the hands of decision-makers. In the past, time always had to pass between requesting information and the information landing on your desk; now, speech-recognition technologies and AI-powered analysis techniques allow business users to simply ask a question and get an immediate answer. There’s no special training involved, and multiple sources – years’ worth of reports and research, internal and external data – are neatly compiled into a concise reply.
This technology is available right now. It can be customized to the hospitality industry, with a dictionary of industry terms and personalized role-based interfaces for different users. It can be accessed from nearly any device, including desktop, tablet, and mobile.
Questions about costs, pricing strategies, marketing, customer profiles, emerging guest priorities, and more can be answered on-the-fly. Once again, time is the critical factor, and this puts insights right where they are needed.
Forecasting Customer Behavior and Next Steps
If no one knows exactly how customers will change their post-pandemic behavior, how can hospitality companies create a game plan? They can use AI to listen to data. It allows companies to see trends from well beyond their region, picking up small signals from social media and other sources and using them to forecast demand and identify potential problems. These insights can also be used to prepare personalized offers, develop new training programs for staff, and find other ways to address customers’ concerns.
Data can also help brands develop various scenarios and prepare accordingly. For instance, suppose an effective vaccine is developed in the near future; this would ramp up demand. Conversely, suppose there were several waves of new outbreaks; this would slow recovery further. With the right data, it’s easier to prepare an action strategy for either of these scenarios.
Time to Step Up Your AI Game
The New Normal, from where we’re currently sitting, is hard to forecast. But we can be sure that the companies who can quickly accommodate new behaviors and trends will be more successful than their slower peers. AI can help you survive this uncertainty and prepare for whatever comes next. It might not have seemed so important in 2019, but in 2020, AI is something the hospitality industry needs.