Data and AI for Luxury Hospitality Leadership
In a hospitality world of intensified competition and guest expectations, data and AI are no longer nice to haves. And yet most hotel marketers steeped in data still don’t know how to use it.
(Not their fault—humans are naturally bad at parsing big numbers.)
Advant was asked to host a workshop at the PURE 2024 conference in Morocco to help unpack that thoroughly modern problem.
Alex Liu, the head Advant’s data science and AI division, shared with top hoteliers in attendance an expert’s take on data and AI, delivering three critical lessons gleaned from his background quant trading in financial markets, and recast for hospitality with the help of Sangjay Choegyal.
Here are portions of the presentation:
The Power of Data and AI in Hospitality
Why does Data Matters?
Data analysis provides several key benefits:
Data justifies actions: Data builds trust and validates decisions.
Data helps you gain a competitive edge: Through understanding customer behaviors, anticipate demand, and track market trends.
Data allows you to measure and refine: By continuously improving operations through benchmarking and optimization.
The Current State of Data
Most hotels are at the reporting stage of data. Reporting collects and organizes data tells you what happened.
But analytics digs deeper to tell you why something happened and what you can do to improve. Expertise can take those mountains of data that you already have, to extract real insights that lead to action. Insights that shape your strategy and refine your decisions.
Data Overwhelms
We have an endless onslaught of data. A 50-room hotel receives 930 customers a month: that's at least 5,580 data points from name, gender, age, nationality, history, room choice, to spending patterns. Without analysis that information is swiftly overwhelming, and increasingly ignored…
…And that puts us in our current pickle….
Enter AI.
With the amount of data we have access to now, only AI is equipped to tackle it. AI can help:
Manage and organize data: Handle large datasets efficiently.
Identify patterns and connections: Uncover hidden insights that humans might miss.
Provide predictive analysis: Forecast future trends and outcomes.
The AI Catch
AI is a predictive engine, not a reasoning engine. We’ve all seen AI get things wrong, producing nonsense at times.
AI needs regular attention from humans with reason, feeding it good, clean data, to be able to shape strategy.
When information is contextualized, it becomes knowledge. When knowledge compels convictions, it becomes wisdom.”
- Henry Kissinger
Advant's 3-Step Framework
to Mastering the Market
The hotels that harness the power will find patterns and insights that would take humans a lifetime to find.
Advant tackles it in three steps:
Step 1 - Devising a data-backed Strategy: Utilizing AI to analyze data and identify opportunities.
Step 2 - Planning and Executing the Strategy: Implementing the insights and recommendations.
Step 3 - Monitoring and Refinements: Continuously evaluating performance and making adjustments.
Want to start having the data work for you?
Step 1: Devise a
Data-backed Strategy
Data Strategy: A Top-Down, Bottom-Up Approach
Data strategy is a two-pronged approach: top-down and bottom-up. Top-down focuses on the big picture, identifying market trends and patterns. It's efficient for strategic insights.
Bottom-up dives deep into raw data, like customer reviews and flight schedules. It's more complex but can uncover hidden opportunities.
Top-Down
Hospitality professionals are very familiar with top down data: travel stats and industry reports.
The Bottom-Up Advantage
Bottom-up analysis is about the details. With AI, you can access and analyze vast amounts of data from sources like OTAs, hotel websites, and customer reviews. While each piece might seem small, together they tell a powerful story.
AI can analyze this data using proprietary software, revealing insights that are often missed in a top-down approach. This is where you find hidden gems, the nuances that can make a significant difference.
Using AI in Data Visualization
Humans are visual creatures. Charts and graphs help us recognize patterns in data. This is why visualization is crucial in data analysis. It turns raw data into something understandable and actionable.
AI can create visualizations in seconds, saving time and effort. This allows for dynamic and engaging storytelling, like animating the evolution of tourism trends.
Line charts: Track trends over time, like the impact of COVID on tourism.
Heat maps: Highlight high and low scores in a matrix, such as hotel ratings.
Bubble charts: Overlay multiple dimensions of data for a comprehensive view, like market analysis.
This AI animation tells the story of how Bali tourism evolved over the last 4 years. First you see that during Covid only Indonesians were traveling, and they were averaging 2-3 nights at around $200 per night. As we get out of Covid, we quickly see Australians breaking out of the pack in both size and spending at 4 nights average and $400+ per night.
Then, as the war in Ukraine broke out, suddenly Russians start to stay longer, averaging 5-6 nights at $400/night, followed by Ukrainians. By 2024, nationalities start to normalize with Australians the top spenders in the region.
Understanding New Markets
To understand a potential new market, again go both top down and bottom up.
Top-down: Destination arrival data shows us broader visitor trends.
Bottom-up: Competitor review nationality data reveals exactly where our competitors' customers are coming from.
From the top, we see that Australia is the largest single source market. From the bottom-up, Competitor 4 has a disproportionately large German audience—an area worth exploring further. This can help direct a marketing budget.Step 2: Planning
and Executing the Strategy
Execution is Key
A well-planned strategy is essential for successful execution. Clear timelines, effective tools, and transparent communication ensure that everyone is aligned and accountable.
Integrated Approach
Effective data strategy involves integrating insights from various sources and channels. This ensures that all marketing and operational efforts work together towards a common goal.
By combining top-down and bottom-up approaches, leveraging AI for data analysis and visualization, and executing strategies effectively, you can gain a deeper understanding of your market, identify growth opportunities, and make data-driven decisions that drive business success.
Step 3: Monitoring
and Refinement
You have asked the right questions, collected bottom-up data, and used those insights to build a strategy. But that’s just one part of the process—a one-time effort of research and planning.
The real magic happens when we make this process dynamic. Tracking, monitoring, and refinement allow us to continuously oversee every detail of our efforts, analyze performance data in real-time, and adapt as the market and customer behaviors evolve.
It’s a living, breathing process, evolving as you receive your daily influx of data.
At the core of any hotel operation is PMS and CRM. These systems need to be compatible and self-updating.
With a well-set-up PMS and CRM, all your proprietary data stays complete and yours for years to come. That’s crucial for ensuring long-term success.
To track customer behavior data you need to set up the right tools on your website and booking engines—like Meta Pixels, Google Analytics, and backend trackers.
Publicly available data on your market and competitors is a massive amount of data—too much for any human to track effectively.
There are plenty of providers out there that monitor rates, but that’s only one piece of the puzzle.
In silos, these data sets can be misleading…
Advant has developed a system called Vantage Point that tracks a wide range of data sets, including competitor rates, their clients, average value and length of stay, flight data to destinations, source market holidays, and local events. It also monitors the performance of your marketing efforts, from PPC advertising to customer journey tracking and content performance.
With Vantage Point, all the data Advant gathers—competitor rates, customer behavior, market trends—flows back into one central point: an AI black box. Every day, new data streams in, and this system constantly monitors, tracks, and refines. It’s efficient, smart, and always improving.
Get in touch with us about your Data Needs