In recent years, the development of AI and automation for hotels has been a game-changer for the industry.
It gave hotels the ability to review enormous quantities of information, make data-driven decisions in real time and improve overall business performance.
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Specifically, within the field of revenue management new AI-based solutions can provide live market intelligence and help hoteliers optimize, adjust and even price automation.
But with all these powerful tools, one question remains: how do you ensure that the system’s approach fully lines up with your business strategy? And which role do people play here?
That’s where the partnership between humans and machines comes in…
Interacting with artificial intelligence
For decades tech developments have been helping revenue managers improve their workflows and their efficiency. The earliest tools that improved automation for hotels took care of data collection and collation. This saved vast amounts of time and allowed revenue managers to focus more on their job’s strategic side rather than just the tactical one.
Next, artificial intelligence and machine learning came along. Advanced pricing algorithms emerged and can now recommend or even set rates on autopilot. As a result, hotels can leverage next-level dynamic pricing. This gives them the ability to realize previously untapped revenue opportunities and maximize profitability.
In some circles, these developments have prompted the following question: if these new tools are so great, can’t we just do away with revenue managers? Our answer: not at all!
Take a look at modern ships and planes, for example. They’re all fitted with powerful autopilot functions, but they still have captains and pilots. These highly skilled professionals are there to regularly check the systems, correct course if necessary, and handle the many other complex tasks that even today’s best AI isn’t capable of yet.
It’s the same in hotel revenue management. Business intelligence and pricing tools provide invaluable support that will help you dramatically boost your results. But if you want the algorithm to follow your rate strategy and or your brand’s pricing rules, some level of human input and guidance remain important.
To achieve that at your hotel, implement the following three steps to create a successful partnership between human revenue managers and their AI sidekicks.
- Establish the foundations
AI tools are great at executing tasks. But for them to do it well, they first need to know what you want them to do. For example, autopilot navigation can help a ship find its way anywhere, but first, it needs to know the desired destination.
This also applies to hotels. Here, the revenue, sales, and marketing teams need to set goals and develop the commercial strategy within which the AI tool can operate.
Among other things, your job is to identify your target markets, set revenue goals, and define your inventory. That includes designating room types, developing your pricing hierarchy, and determining the standard minimum and maximum rates.