How Artificial Intelligence will change the Hospitality IndustryBy Michael Toedt - Managing Partner and CEO at TS&C GmbH
How Artificial Intelligence will change the Hospitality Industry | By Michael Toedt
A fascinating and at the same time scary topic is entering our working world: Artificial Intelligence (AI). Many industries are already looking for ways to apply AI. So far, not much activity can be seen in the hospitality industry.
More Individuality through Big Data
Artificial Intelligence is a key element of Big Data – also called the Fourth Industrial Revolution. The rational behind is simple and complex at the same time: to find out as much as possible about a customer by using comprehensive data management to then use the insights in order to meet the customer's individual needs. Big Bata stands for individuality. The essential resource is data – huge amounts of data. The maxim is the more data, the better.
Machine Learning is an aspect of Artificial Intelligence, which generates valuable information from more or less useless data. Systems like the Profile Engine by dailypoint™ help to draw conclusions from each booking, each click and each movement. This helps hoteliers to create a constantly growing and learning centralized guest profile.
Central Data Management is the Key
The prerequisite for Machine Learning is a centralized system, where all relevant data streams are linked and the data is stored. Many hotels still use isolated solutions without sufficient linkage, which prevents valuable use of the available data. The constantly growing flood of data can only be leveraged when using a CDM (Central Data Management), which is the consequent evolution of a modern CRM.
Machine Learning helps to create a comprehensive guest profile, which can be used to create a unique customer journey and guest experience. Modern consumers expect tailor-made solutions at all touch points – from the first contact to the proposal, during the actual stay and in CRM. To live ones individuality and to make personalized experiences is the new luxury. This is also valid for hotel stays. The better you know your customer, the better you can adapt your offering and personalize the guest experience.
Mass Commodity Products are passé
Such a comprehensive knowledge base can only be created with the support of Machine Learning. The goal is to create unique experiences for all your customers and not just a few! This will give you a clear competitive advantage and will show in positive economic results. Also mass commodity hotel products are passé.
It makes no longer sense to gain information about the guest by observation and manual processing of the gained information. Questionnaires or observations are outdated; new approaches using the new technology can bring much more information. Hoteliers will know more about their guests than ever before, more than most people can imagine today. The information just needs to be used in a creative and targeted manner.
The intelligent Hotel
Intelligent hotels, where all data streams are linked, are the future. In an intelligent hotel all systems are interlinked, similar to an organism where everything is connected and supplied through veins and arteries. The Internet of Things (IoT) will help to further develop the personalized guest experience. The connection of room control, motion sensors, the integrated TV and voice control systems, such as Amazon's Alexa, Apple's Siri or Microsoft's Cortana are developments which will also impact the hospitality industry.
We are facing quite some changes and it's wise to face them, as this is only the beginning of a huge change process.
Dr. Michael Toedt is the founder and CEO of Toedt, Dr. Selk & Coll. GmbH, a leading Big Data Marketing and CRM company. Operating at the intersection of business and technology, he helps hoteliers with the software dailypoint™ to use the tremendous increase of data in order to become data-centric. Dr. Toedt has over 25 years of experience in operations, technology and marketing. He is the author of several books (among others “Big Data – Challenges for the Hospitality Industry” (2013) and “Data Revolution – How Big Data Will Change the Way of Doing Business” (2014) and his articles are published by journals on a regular basis. Dr. Toedt holds a doctoral degree in management science. He is assistant lecturer at the University of Applied Sciences of Munich for the subject “Customer Relationship Management in Tourism” and as guest lecturer at various universities such as the University of Applied Sciences of Bad Honnef, Kempten or NDS Hôtelleriesuisse. In the past, Dr. Toedt was regional vice president of SANSORA INTERNATIONAL, a subsidiary company of the Schoerghuber corporate group and accompanied many hotel associations during the production of their central customer and marketing data base. He was raised in his parents’ hotel and after completing a mercantile apprenticeship he graduated as cook to be employed in the 5-stars restaurant Hotel Koenigshof in Munich. 1995 he began his business economics studies at the University of Applied Sciences in Munich. During this time he visited the Cornell University, NY and is now President of the German Chapter.
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