Have you heard about Edward from Radisson Blu Edwardian London? Three years after his creation in 2016, he could reply to over 16,000 hotel guests’ questions and perfectly cope with the duty of the Concierge. He was so popular among the hotel guests that they nominated him for the Employee of the Month and even looked to tip him.
Edward is a smart concierge chatbot. According to a case study about Edward, up to 75% of the questions it replied were the ones that the Front Desk staff replies, 24/7.
Robot-concierge at the hotel lobby, voice assistants at “smart” hotel rooms, messenger-based chatbots of hotels, restaurants, leisure companies, and travel agencies—they were already common before Covid-19 at such global chains as Marriott, Hilton, Shangri-La Hotels & Resorts, Four Seasons Hotels & Resorts, Domino’s Pizza, Pizza Hut, TacoBell, Burger King and others.
Covid-19 did not bring the need for automation, digitization, and robotization to the tourism industry. It only forced the adoption and sped up trends, behavior, habits, and technology usage that were already here in the past years.
Nearly half of the questions related to reservations at Booking.com, which means millions of questions, are processed by a chatbot. It was implemented by the company after research conducted in 2017 in 26 countries among 19,000 customers. It found that 80% of the customers preferred a self-service to receive information or service, and for some 50% of them, it didn’t matter who answered: a human being or a chatbot.
According to a report by Software Advice, an organization engaged with research in technologies, even in 2015 customers would use a smart platform for self-service that would provide them with necessary information or service. According to another survey by Google three years ago, up to 60% of customers thought that Artificial Intelligence (AI) must be utilized in the tourism industry and 36% of them were ready to pay for such a service.
The growing digital-first habits and the constant acceleration of everyday life brought customers to the “see, hear, try, and buy right now and here“ mode. Even before the pandemic, a few years ago already over 50% of customers were convinced that businesses must be present online and be ready for communication 24/7 via chat in addition to phone calls, e-mail, or SMS. Salesforce published a report in 2019, according to which 78% of the customers used text messaging for communicating with a company, and 81% used online chat… Customers became more mobile, experienced, digitized, and high demanding. Their needs could not be fulfilled without the assistance of technology. Those expectations called for digitization and the automatization of communications.
The Pandemic opened the door to technology
Tourists confirm it. In the Autumn of 2020, Amadeus did global research in Europe, the United States, and Asia. According to the survey, 84% of the travelers responded that the usage of technology in all touch points of travel is the key to the decision-making if, when, where, and how they will travel in the next months and year. Did you know also that 73% of people agree that they’re more likely to stay at a hotel that offers self-service technology to minimize contact with the staff and other guests. 77% of travelers are interested in using automated messaging or chatbots for customer service requests at hotels. 38% want a fully self-service model, with staff only available upon request. And 39% want to order room service from their phone or a chatbot. That’s why 96% of hotels are already investing in contactless technology, with 62% noting “a fully contactless experience” is likely to be the most widely adopted tech in the industry in the next three years. Travelers expect technology to help them:
- Avoid queues and crowds
- Keep social distancing
- Avoid the need for face-to-face contact with staff
- Ensure cleanliness
- Ensure safety
- Provide instant up-to-date information
Technology added an important layer of benefits on top of the one we already are aware of—such as convenience, time and resource savings, speed of service, and better customer experience. This is the layer of bio-safety digitalization provided through touchless, contactless, digital, mobile self-service solutions and robotics. The pandemic put self-service on the focus of the businesses in many industries, including tourism, because digital self-service was the fastest way to adapt many aspects of the business and service to the pandemic situation.
Before the pandemic, chatbots were known mainly as a tool for digital marketing and were used for marketing campaigns, collecting emails and phones, and for push notifications for news and promotions. The pandemic put flipped the interest towards the need for fast contactless remote online customer service and communication, and chatbots shone with many benefits and opportunities in this regard. Many businesses have focused on automating routine tasks and customer service using chatbots—to take customer questions and inquiries 24/7, to provide instant information, to check status or to accept a service inquiry, to make a reservation. This is the first line of service that bots do well and is usually routine work for the employees that they would gladly not do themselves. Not to forget to mention, that having a well-developed and trained AI chatbot also become an important training tool for the new employees as they gain a digital hotel compendium with up-to-date information about everything on the screen of their phone in their pocket.
Labor shortages & hospitality – trends 2023-2025
The prevalence of staff shortages, wage inflation, and employee dissatisfaction are leading to decreased guest satisfaction, which is a major financial risk for the years ahead. A Skift and Oracle hospitality survey shows that 64.7% of executives surveyed consider incorporating new technologies for staff efficiency as a part of their labor strategy to attract and retain staff in the 2023-2025 period of time. What these technologies would be?
For sure, the staff does not want to answer the boring frequently asked questions 24/7 instead of doing more complex and valuable tasks. AI chatbot could help staff by relieving them from customer inquiries and being available 24/7 to assist. It could be among the chosen technologies to help hotel businesses stay competitive and retain staff. 35.6% of the executives across the hospitality industry said that providing better career growth opportunities could also help with staff retention. How do AI chatbots fit into such a strategy? Well, firstly they take care of the employees and the business’s overall health by removing the routine and decreasing job-related stress. Secondly, more interesting work means more motivation to work and willingness to develop new skills and achievements. AI chatbots help to improve the employees’ work balance and you can learn how exactly in our blog post on the topic. 23,6% of executives said that incorporating mental health and wellness programs could help too. Along with health insurance and medical examinations, AI chatbots as digital assistants take care of the employees’ mental and physical health by relieving them from the annoying routine and give many more benefits that you can learn in the mentioned blog post on the topic.
Providing easier and more intuitive technologies to staff is a chosen strategy by 22% of the executives. An AI chatbot on the hospitality business’ site improve online 2-way communication, helps not only the guest to find the answer to their questions but also the employees to find certain answer when they need them on their mobile phones in their pockets. Additionally, an AI chatbot made on the Umni platform needs no technical knowledge and skills to be created and then used by anyone in the business circle – guests, employees, partners, or others. Just a chat on the business’s site!
20.1% of the executives said that using analytics and AI (artificial intelligence) to personalize guest experience also helps the staff shortages. How this could happen? Customers love more personalized experiences, which means more happy customers that could lead to more reservations! An AI chatbot could be the digital employee to help all these customers to assist them to make a reservation, booking a hotel service, or other, and the team (no matter its size) could take up the more valuable tasks so the whole business could benefit from such digital employee. AI chatbots help customer experience to be more personalized in many ways which you can learn in our blog post on the topic. AI chatbots also save up to 12 minutes of communication of employees per customer. For example, Miss Fiore – the hotel AI chatbot of the 5-star Casa di Fiore SPA & Medical Hotel which is now an indispensable member of the hotel team in just one year saved nearly 7,000 hotel employees work hours (equivalent to the work of 3-4 employees each month). Isn’t that amazing results that you would want for your hospitality business, too?
On the other hand, in the same research, travelers were asked: How interested are you in hotels using artificial intelligence to analyze your travel information for the following purposes? 29.6% are very interested to make their trip better, while 43.8% are somewhat interested if they willingly provide the data for this purpose. AI chatbots collect only first and zero-party customer data which does not violate customer privacy at all – only data about their searches, at what time of the day, or willingly provided information. That’s why AI chatbots are more and more chosen for first and zero-party data strategies to use when third-party cookies disappear next year.
Digitalizing the communication with customers – ASAP
Prior to the COVID-19 outbreak, the banking, healthcare, and retail sectors relied heavily on conversational agents to bolster customer support functions. Chatbots were on pace to save these sectors more than $11B by 2023 which is now a fact.
With face-to-face customer service interactions limited and not desirable, a lack of staff, and the need to decrease cost, AI chatbots and virtual assistants are becoming more important than ever.
In 2020, in a webinar about digital and self-service strategy, Gartner named digital self-service as the core activity businesses needed to maintain their business and recover. Chatbots were listed in the top 5 solutions to implement. CBInsights also included AI chatbots among 25 technologies that will shape and change the world and the business in the post-covid time.
Upgrading the chatbot with conversational AI allows the business to collect customer questions and turn them into data, train the conversational AI with the proper answers, and gradually increase the level of automated service.
The more customers ask, the smarter the AI module becomes, the more data and statistics are collected, and the more businesses know about customer behavior to make intelligent decisions. For example, Umni as an AI chatbot platform had developed and offers hotels a pre-trained AI module to start with 11,000 common customer questions on close to 800 hotel topics in it and recognizes over 95% of overall customer questions, in Bulgarian and English, also offering voice assistance (speech recognition) in Bulgarian and English. This means the hotel chatbot can recognize hundreds of customer questions and answer them from Day 1 while adding more and customizing the AI module for specific property needs. This way, an AI chatbot can content and offer instantly 24/7 more information about the business, its services, and products than any website, mobile app, or printed collateral can do without to affect negatively the customer experience in the usage process. No download and installation, no learning how to use it, and the friendly chat style of communication are other highlights of why customers look for the AI chatbot presence.
In the past few years, we saw chatbots being implemented in various tourism businesses due to such major challenges to solve as face-to-face communication between customers and employees and the need to decrease the fixed costs, as well as lack of staff at the reopening. Examples in Bulgaria are properties of all sizes and levels of service like the 5-star hotel Casa di Fiore SPA & Medical Hotel, the family-run complex Izgreva, Apartments Fortuna Bansko, the guesthouse The Herbal House, and more properties are in the development of their hotel AI digital assistants to help the employees achieve more.
Traditionally in tourism, AI chatbots answer frequently asked questions and automate routine tasks such as various inquiries, forms, requests for accommodation and services, requests for events, room service, massage, table at a restaurant, or search for offers, products, and services based on user-selected criteria.
Because chatbots work 24 hours a day and respond instantly, bots also help increase direct sales—especially for those customers who send requests or look for assistance at night. Due to remote work, home office, and other changes in personal and business life, today’s customers are online for work and personal matters much longer, stay online at night, and expect an immediate response. Our own research at Umni showed that the time between 7 o’clock in the evening and 8 o’clock in the morning in the past 24 months was almost as active as the daytime chatting with the AI chatbots of the businesses, with 11:00 o’clock to about midnight being a peak hour. On average, 35% of the customers are choosing to search for information and ask questions in the chatbots at nighttime.
What the AI chatbots can do?
A chatbot is a software solution that is implemented on a website, in a messenger, in a mobile application, or elsewhere providing users with information through text, images, video, audio, links, and more. Chatbots can perform a variety of tasks, from answering frequently asked questions to automating reservations, and service inquiries, gathering customer information, questionnaires, and more. One important highlight is that they can be accessed through a QR code with a link to the bot or specific bot part such as information, form, menu, or other, improving guest experience and allowing limitless opportunities for fast inquiries, sales, and upgrades. The functionalities of each specific chatbot depend on the business needs, where it will be implemented, and with whom it will communicate—with clients, partners, or employees.
Automating communication and implementing an AI Chatbot has already recognized benefits such as generating more local business, promoting the business, reducing costs and resources, engaging more with customers, attracting new markets through a new digital experience, getting data for better planning, and others.
As per Juniper Research whitepaper (Why Chatbots Are Essential to Retail), 43% of the existing chatbots are located on websites versus 48% in messengers, and it is expected the number of chatbots located on business websites to increase. Web-based AI chatbots can act as a first and immediate contact point for customers, answer FAQs and collect inquiries from both potential and in-house guests. They become even more important for hotels and hospitality businesses as new research by Site Minder from January 2022 shows that the boom of direct traffic for hotels globally in the past year brought the hotel website’ ranking to the top 3 hotel booking revenue makers in the most markets, covered by the research. Making sure the website is smart by having an AI chatbot on it, is becoming a business necessity to make sure the business can answer all customer questions and needs, and keep the customer, and not a tech fashion. It is not surprising therefore that in 2022 it is expected that chatbot implementation and offering by hotels will increase 53% (64% among the independent hotels), according to a survey from January 2022 by NYU Tisch Center of Hospitality и StayNTouch PMS.
A good chatbot can start at a considerably basic level when users just click on the buttons in it to navigate the information and tasks, but this is only the initial stage when feedback is collected on how customers use it and what they are looking for to identify the future direction of chatbot development. For customer service and support, planning for conversational AI in the chatbot is a must. Chatbots are long-term projects that require attention, analysis, and upgrades so that one day the business can have a fully developed smart digital assistant.
Here are some of the duties that could be performed by a hotel chatbot, 24/7, in one or more languages, while servicing multiple customers simultaneously and instantly:
- Provides prospect customers, guests, and corporate clients with information about the hotel, hotel services, amenities, surrounding hotel area, etc.
- Assists with room reservation inquiries
- Assists hotel guests with reservation of a table at a restaurant, massage, room service, shuttle, vouchers, wake-up call, and various other inquiries and services—from a link online, from the hotel website, or from scanning a QR-code in the room, restaurant, SPA or placed at other location to open straight the needed form in the bot
- Notifies the hotel Front Desk or other departments about a new inquiry
- Communicates with clients and staff
- Answers frequently asked questions, etc.
At a restaurant, the chatbots’ work is similar to their hotel colleagues:
- Providing information about a restaurant
- Providing a menu based on a client’s preferences
- Assisting with table reservations
- Accepting requests for a food delivery
- Promoting vouchers for future visits, promoting campaigns, etc.
- Providing voice assistance (speech recognition) for quick and easier online communication
The usage of chatbots in tourism is not limited to hotels and restaurants only. The software solution can be in service at SPA centers, tour agencies, and other providers of tourism services, parks, entertainment centers, museums, city info centers, and other services. A smart digital assistant as a City Concierge is already a part of the Smart Tourism Strategy of many destinations and cities. In 2019, Umni created the 1st in Bulgaria pilot project for a city tourism AI chatbot – the Plovdiv City Concierge, for the tourists of Plovdiv city as the European Capital of Culture’19, with over 400 businesses, services, sightseeing spots, shopping, and other points of interests included in the AI chatbot database.
Because of the variety of tasks and services that an AI chatbot can perform and automate, today the question is not about the technology—could it do it or not, but to the business that adds a digital assistant to the list of service solutions: what the chatbot will do, what tasks or processes it should optimize, and whether the business is ready to implement a chatbot into its daily operations.
While chatbots can answer frequently asked questions and automate routine tasks, such as the collection of information for orders, inquiries, and appointments or perform other tasks through integration with business software and platforms, the overall quality of the self-service through an AI chatbot is based on the thorough planning of all steps and details. Companies with a focus on creating, maintaining, and training AI chatbots for their businesses shall go through proper planning to automate and answer their frequently asked questions and routine tasks for improving customer service and support by involving all departments at this planning stage. The hospitality businesses shall consider the level of technology adoption of their customers, optimization, and simplification of all steps in the customer path through the self-service via chatbot, the promotion of the chatbot, and customers’ and employees’ education on how to use it, as well as who and how will use the collected by the AI chatbot data and what is the process of proceeding various inquiries coming through the chatbot. Last but crucial also is the need of having a team member in charge of the continuous chatbot data monitoring, content maintenance, and AI training to ensure its proper development in accordance with customers’ usage and needs, and business development.
Take your time to set up and grow your hotel or tourism business AI digital assistant personalized to the needs of your business and customers but do not delay the implementation. To have a successful fully developed smart digital assistant in a year from now and achieve the desired business results, the best time to start was yesterday. The next best time to lay the foundations of such an AI chatbot project for your business is today.
This article by Elitza Stoilova, CEO of Umni and member of the ITB Community, was originally published on February 7th, 2022 in the section Insights on ITB Asia Community.
Last update: March’23