How AI in travel and hospitality is enhancing experiences and optimising operations

From personalised guest interactions and automated travel itineraries, to voice-assisted bookings, AI is transforming the travel and hospitality sector. Image: Shutterstock

Travel bookings have long been pain points among customers, with the process often marred by complexities, overwhelming options, and time-consuming searches. However, with the help of artificial intelligence (AI), online travel aggregators (OTA) are now offering features such as personalised and automatically generated itineraries and voice-assisted bookings to transform the process into a more streamlined and user-centric experience.

Take these innovations, for example.

In July 2023, OTA Ixigo introduced ‘Plan by Ixigo’, a trip planner built on OpenAI. With this, the platform can process and understand users’ preferences, and offer them personalised recommendations, suggestions, and itineraries. Alternatively, if users have a destination in mind they will be able to select from a range of trip themes or provide their preferences for a customised trip plan. 'Plan' will automatically tag, map and generate a detailed itinerary for the chosen destination and chosen theme, additionally integrating weather and air quality index updates.

“Since the launch, we have generated 30,000 new itineraries,” says Rajnish Kumar, co-founder and group CPTO. “Our objective was to make travel accessible to all. We’ve ensured that the recommendations are accurate and factually correct.”

Soon, Ixigo plans to introduce features to enable users to collaborate with friends and family for an interactive trip-planning experience.

Similarly, MakeMyTrip collaborated with Microsoft to introduce voice-assisted bookings in Indian languages in May 2023. Currently, the beta version of this integration has been introduced in English and Hindi. The feature will offer personalised travel recommendations based on user preferences, curate holiday packages based on variable inputs like occasion, budget, activity preferences, and time of travel, and even help book these holiday packages.

“It opens the online travel ecosystem to every strata and demographic across the country,” says Rajesh Magow, co-founder and group CEO, MakeMyTrip. “It breaks down the barriers of language, literacy, and the inability to navigate complex app environments.”

Another OTA EaseMyTrip has incorporated AI chatbots and assistance to help the platform personalise travel and customer experience. “By analysing consumer behaviour and feedback, we continuously improve our services and offer better deals to our users,” says Rikant Pittie, co-founder. “Since introducing these AI features half a year ago, we have witnessed a positive impact on our customer engagement, retention, and overall performance, with a notable improvement of 14 percent.”

AI has made a landing at airports too. At Mumbai’s Chhatrapati Shivaji Maharaj International Airport (CSMIA) and other Adani-operated airports, multiple AI solutions, generative and others, are going to be rolled out, informs a CSMIA spokesperson. Some of these features will include passenger load or footfall prediction at least four to 12 hours ahead, foreign object debris detection on the runway, and more. Adani Airports have also invested in an AI-enabled video analytics solution to help identify passengers in need of additional assistance.

“With these features in place, the customer experience is going to change drastically,” says Prashant Garg, technology partner, EY India. Travel and hospitality is a people-centric industry and it demands engagement. "People want this conversation to be personalised, but that comes at a high cost. Hence, generative AI is the answer to that personal and human touch.”

Also read: 'India set to become a key player in the global travel industry': Hilton's Ben George

Checked in

One of the most prominent ways in which AI is making a difference in hotels is through personalised guest interactions. Most hoteliers are utilising AI-powered chatbots and virtual assistants to provide instant responses to guest queries, whether it's about room availability, amenities, or local recommendations, says Garg.

Some hotels such as Hilton India are testing new features to help personalise guest bookings and stays, including pre-booked meals and parking.

At Conrad Pune, Hilton’s flagship hotel, couples can visualise their weddings and choose from more than 1,000 options for décor, theme, and arrangements through an AI-enabled feature called Wedding Studio. It is a 360-degree virtual experience that was launched in April 2023.

“AI has become ubiquitous in our lives, and its impact on the hospitality industry is no exception. For guest experiences, AI can revolutionise how hotels cater to their guests,” says Manish Tolani, vice president, and commercial director, Hilton India.

At some Marriott hotels, including The Westin Resort and Spa Himalayas, through initiatives such as the mobile key, guests can access their rooms without having to wait to check-in, and via chat, guests can connect with the hotel’s team from anywhere.

SaffronStays, a vacation rental platform in India, has integrated AI across its entire value chain. “Everything other than the actual stay experience is now powered by AI at SaffronStays,” says its founder, Deven Parulekar.

The chain has leveraged large language models (LLM) across the entire guest journey, from pre-booking and booking to post-checkout, loyalty, and retargeting. (LLMs are a type of AI that use large data sets to understand, summarise, generate, and predict new content.) AI has also been helping the company generate ads and deploy them without having to rely on elaborate creative teams, ultimately streamlining marketing efforts.

“AI forms the silent weapon working behind the scenes to deliver superior outcomes,” says  Parulekar.  

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Travel vs hospitality

While OTAs are embracing AI at a pace matching the rest of the world, its integration in hotels is comparatively slower.

Cart abandonment rates at OTAs are notoriously high, explains Ankit Chaturvedi, marketing head at RateGain, a SaaS company for hotel software. For instance, when a user leaves a travel booking website, there is no way for it to continue the conversation with the user. Generative AI will allow them to do that by responding to the user as per their needs.

“The power of generative AI is that if it’s looking at the same user, it will start understanding preferences and therefore the window to book will become shorter and that’s what the OTAs ultimately want to achieve,” he adds.

With hotels, one has to understand that it is an extremely expensive business. In the West, larger hotel chains have deeper pockets and a dedicated technology team. It's not the same in India, therefore it's difficult for them to pick up on a trend and execute it.

"It comes down to the issue of scale and how much money they [hotels] have to invest in technology. OTAs are essentially technology companies with the wherewithal to implement tech stacks. However, generative AI has brought this technology into the mainstream and therefore, hotels will not be able to ignore the concept anymore,” adds Chaturvedi.

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More efficiency with fewer people?

Parulekar highlights that in a people-intensive business such as hospitality with rising payroll and human capital-associated costs, it becomes important to remain lean at all times. According to him, AI helps control these costs effectively while also improving the guest experience.
From 120 homes being managed by a central team of 170 staff, he says they now have 240-plus homes managed by a staff of 120 people.

Does that mean AI will take jobs in the travel and hospitality sector?

"Yes, definitely, in the short term, particularly in customer care, sales, marketing, and operations; in that order," says Parulekar. “The automation of certain tasks may lead to job redundancies or reduced human resources in these areas.”

However, experts like Garg think otherwise. The resulting profitability and improved customer experience will drive further growth in the sector, creating new job opportunities in emerging areas of AI application, he says.

“There will be no job cuts, there will be job redefinitions.” He adds, “The cost of operations will come down, but that doesn’t mean jobs will too. Improvement in businesses will mean more people will get deployed, but people will need to acquire new skillsets to work in a different ecosystem led by AI.”