How AI Will Change Hospitality
By Josh Bobrowsky
AI is going to reshape the world at a scale as big if not bigger than the Industrial Revolution.
One of my greatest predictions for what will change with AI is the hospitality industry.
Specifically the quality of human interactions in hospitality businesses is about to get substantially better.
Let me explain…
0 to 100 Hospitality
Ranking hospitality from a 0 to 100 scale will help us to quantify the service.
0 is the worst experience you have ever had
50 is an average experience today and
100 is the greatest possible experience
Examples:
Experience 90+: The best customer service possible
Examples: Aman Resorts, Emirates First-Class Suites
Experience 70-90: Good experiences
Examples: Apple Genius Bar, A high quality Trader Joes, a coffee shop that you enjoy going to every week
Experience 50-70: slightly positive but forgettable
Examples: Hilton hotel nice staff friendly but not memorable
Experience: Below 50: You wish you didn’t have to interact with a human
Examples: Bad drive thru experience, rude hotel staff
How AI changes everything
AI will be able to create experiences that will be a 60. This means every business with poor customer service will have the option to replace their low hospitality with AI. A few quick examples of things I expect in the next 10 years:
Fast Food: AI fast food workers take your order perfectly, remember you and your preferences. Easily done through tracking cell phone, license plates etc
Phone Customer Service: AI customer service picks up your call on the first ring and are able to address and fix your problem quickly
Restaurants: Friendly robots take your order, deliver your food, no need to tip
Hotels: Immediate check in, your cell phone unlocks door to your room zero wait
The New Rise of Hospitality
AI will change low and mid level hospitality, but the greatest experiences will still be human to human.
Humans will have an even deeper desire to connect in person, without a screen or robot.
These interpersonal connections hold real value.
Much like people are willing to pay 10x the price of an Ikea table for a hand carved wooden table. I believe people will also be willing to pay substantially more for quality human interactions in the same manner.
This allows small businesses with boutique customer service experiences to deliver massive value and charge a premium for great experiences.
Additionally, small businesses will be able to automate many back of house issues from cooking to accounting and double down on their focus on the human side of service.
Where I would place my bets today
The obvious scalable bet is being placed on AI. However, the less obvious bet today is focusing on human to human experiences that are harder to scale.
But, hard to scale, does not mean impossible to scale. The Four Seasons Brand is worth $10+ billion and Aman resorts are valued north of $3 billion. Both brands based around luxury and experience.
What is the moat? Deeply caring about customer experience.
I would bet on high-end experiences in the following categories:
In person events: Concerts, motivational speakers, races, theater, Ted Talks
Hospitality experiences: High end hotels & Bed and Breakfasts
Ultra luxury group travel & adventure travel
Boutique healthcare & longevity clinics
Private culinary experiences
Elite members only clubs with physical retreats
Bespoke pet travel & wellness services
Conclusion
As AI raises the bar for what automation can do it will also unlock ultra premium luxury. Brands will be able to fully automate most back of the house operations from accounting, to deliveries and fully focus on providing world class experiences. This is an opportunity that is hard to scale but if done correctly will have multi-billion dollar upsides for the best companies in the world.
Cheers
Josh Bobrowsky