Travel Technology

Hoteliers Hit Privacy Wall

Companies embrace technology because it helps them to cut costs. But there may be limits to hoteliers’ ability to integrate artificial intelligence into their product mix. Realigning room-service overhead by using bots to process breakfast orders is straightforward, but tapping into multiple data sources to offer length-of-stay customization may be a bridge too far. One reason for consumer push-back is the recurring problem that the travel business has with cybersecurity. Data-collection practices fall short of health-care protocols, but these databases can be equally ripe for exploitation. Investors in hotel tech should focus on venture opportunities that build on standardized demand and repetitive tasks. Think many booking sites and some bots. The buzz surrounding hospitality-based artificial intelligence is often nothing more than jargon used by industry insiders. Those executives may not see the potential for consumer revolt against firms that vacuum data.

Our Vantage Point: The hospitality sector has razor-thin profit margins, but artificial intelligence is only a partial remedy. Expect data-collection practices to fall under ever-greater consumer scrutiny.

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Image: Traditional hotels have a high cost structure. Credit: Kadmy at Can Stock Photo.

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