Reliance on Robots and Automation in the Hospitality Industry: An Oxymoron?
From robot concierges to in-room VR to hyper-personalization of rewards, digitization and advanced analytics have huge potential to improve the experience for customers of hospitality companies such as Marriott International. However, is the increased use of advanced analytics at odds with an industry built on warm receptions and friendly faces in foreign lands?
You enter your hotel after a long flight, skip check-in, and swipe into your room using your iPhone. Upon entering, you notice your favorite scented candle is awaiting you even though you have never expressed this preference. A moment later, a robot arrives at your front door to deliver the toothpaste you forgot. Although this seamless customer experience may seem like a distant dream far removed from the current headache of travel, Marriott International is rolling out this experience across the globe thanks to the use of advanced analytics.
Digital Disruption in the Hospitality Industry
Throughout the hospitality industry, there is an increasing reliance on digitization and advanced analytics to improve the customer experience. Hotels, airlines, and others are using data to delight customers and differentiate their experience by reducing the pain points associated with travel. Traditional hotel companies like Marriott have already been disrupted by AirBnB and other digital natives who use advanced analytics to radically rethink and reshape the customer experience, delivering a higher level of service at a lower price [1]. Now these industry incumbents must refocus their attention on the next wave of innovation to capture growth and ensure survival [2]. However, critics suggest this focus on data could depersonalize the experience, losing that thoughtful touch travelers crave [3]. Does digitization inherently degrade the human connection that hospitality is based on? Or is it merely a medium to prioritize and provide higher-touch, personalized service?
Marriott International: An Agenda of Innovation
Marriott International is the world’s largest hotel chain and, as a result, is acutely feeling the industry’s push towards digitization. Marriott International cites innovation as a top priority and has introduced a variety of digital solutions to improve stays [4]. At the Marriott Charlotte City Center, guests can swipe into their rooms using their iPhone [5]. At some Marriott hotels, VRoom Service lets guests explore the world from their room using virtual reality [6]. At The Residence Inn by Marriott in Los Angeles, Wally the Robot uses analytics to masterfully navigate the hotel, riding elevators and buzzing guests rooms to deliver everything from towels to toothpaste. Wally provides prompt service and delights travelers who frequently post about him on social media (albeit only when in service as guests have been known to put wet towels in Wally, causing him to short-circuit) [4].
For the longer term, Marriott has made innovation a core part of their corporate strategy and emphasize that ‘[Marriott’s] digital strategy continues to focus on …creat[ing] a superior and memorable stay experience for our guests powered by digital guest services’ [4]. Marriott is rolling out these innovations and more through the use of a digitally-focused beta hotel and the launch of the Marriott Innovation Lab [5] . This long-term strategy will be key for Marriott as competitors leverage advanced analytics to do everything from personalizing rewards to allowing travelers to select their preferred hotel room from available inventory [7]. Digitization and advanced analytics have huge potential create differentiation for hotels brands such as Marriott who have not been traditionally associated with cutting-edge technology and highly personalized service.
Depersonalization: The Downfall of Digital?
However, these innovative advances are not without naysayers. Wally’s dissenters argue that analytical advances steal jobs and depersonalize the customer experience. High-end hoteliers argue that data-driven solutions like eliminating check-in or reliance on robots will never take hold because luxury guests expect high-touch human service [3]. Marriott managers respond that automation of simple tasks frees hotel staff to provide guests more attention and that advanced analytics has now made the hyper-personalized service of luxury hotels accessible to a broader audience [3]. Moving forward, Marriott International should focus on capitalizing on the potential of advanced analytics to improve and personalize their customer experience, while retaining the human element travelers desire.
Further Questions to Consider
The rise of advanced analytics in hospitality begs the question whether personalization and better service have the potential to cheapen the experience or impede on guest privacy? Let’s say, for example, you and your partner stayed at a Marriott hotel on your honeymoon and each evening you bought the same bottle of wine from the mini-fridge. A year later, you return to that hotel and receive a complimentary bottle of that wine. Will you appreciate this gesture more as it is more personalized than a fruit basket? Or appreciate it less because you recognize it was purely data driven? Even further, will you view this as an invasion of privacy – or worse – an unsavory, analytical exploitation of a personal moment and cherished memory?
As the Chairman of the Board recently said in response to the increased use of technology at Marriott, “I think we have to be careful we don’t lose the human touch,” Bill Marriott said. “Every time I get on the elevator, there’s a bunch of people looking at their iPhones. They never say good morning to anyone. They never say hello to anyone” [8].
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References
[1] World Economic Forum in collaboration with Accenture. “Digital Transformation Initiative: Aviation, Travel and Tourism Industry.” June 2017. https://www.accenture.com/t20170116T084449__w__/us-en/_acnmedia/Accenture/Conversion-Assets/WEF/PDF/Accenture-DTI-Aviation-Travel-and-Tourism-Industry-White-Paper.pdf
[2] Bhattacharjee, Dilip, Jules Seeley, and Nathan Seitzman. “Advanced analytics in hospitality”. McKinsey & Company. October 2017. https://www.mckinsey.com/business-functions/digital-mckinsey/our-insights/advanced-analytics-in-hospitality?utm_content=buffer86fe8&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer
[3] Martin, Hugo, “Robots deliver fun with hotel room service orders, and they don’t expect a tip”. Los Angeles Times. February 7th, 2016. http://www.latimes.com/business/la-fi-hotel-robots-20160207-story.html
[4] Marriott International. “Marriott International Inc 2016 Annual Report”. http://files.shareholder.com/downloads/MAR/0x0x936409/834E45D9-8979-4190-AE47-702FBFF54755/Marriott_2016_Annual_Report.pdf
[5] Tkaczyk, Christopher. “A Peek Inside Marriot’s New Hotel Experiment”. Travel & Leisure Magazine. October 12th, 2016.http://www.travelandleisure.com/hotels-resorts/marriott-experimental-hotel
[6] “Marriott Hotels Introduces The First Ever In-Room Virtual Reality Travel Experience”. Marriott Hotels. September 9th, 2015. http://news.marriott.com/2015/09/marriott-hotels-introduces-the-first-ever-in-room-virtual-reality-travel-experience/
[7] “Hilton revolutionizes hotel experience with digital check-in, room selection and customization, and check-out across 650,000-Plus rooms at more than 4,000 properties worldwide”. Hilton Hotels. July 28th, 2014. http://newsroom.hilton.com/index.cfm/news/hilton-revolutionizes-hotel-experience-with-digital-checkin-room-selection-and-customization-and-checkout-across-650000plus-rooms-at-more-than-4000-properties-worldwide
[8] Trejos, Nancy. “Bill Marriott on towels, robots and more”. USA Today. March 11th, 2016. https://www.usatoday.com/story/travel/roadwarriorvoices/2016/03/11/bill-marriott-towels-robots-and-more/81646978/
Photo Credit
Biggs, John. “The Savioke Robot is Headed to a Hotel Near You”. TechCrunch. May 15th, 2016. https://techcrunch.com/2016/02/15/the-savioke-robot-is-headed-to-a-hotel-near-you/
“Marriott Launches its First Futuristic Pop-Up Innovation Lab in Downtown LA”. L’Empereur Magazine”. https://lempereurmagazine.com/2017/01/25/marriott-launches-its-first-futuristic-pop-up-innovative-lab-in-downtown-la/M
“St Regis Butler Service”. St Regis Bangkok Website. http://www.stregisbangkok.com/features_butler
Additional References
Frick, Walter. “What Can a Robot Bellhop Do That a Human Can’t?”. Harvard Business Review. August 25th, 2014. https://hbr.org/2014/08/what-can-a-robot-bellhop-do-that-a-human-cant
“How can hotels achieve the right king of growth in a digital age? A toolkit for fighting commoditization” PriceWaterhouseCooper. October 2013. https://www.pwc.co.uk/industries/hospitality-leisure/insights/how-can-hotels-achieve-the-right-kind-of-growth.html
This article touches on a key technological question: how important are humans to customers? As a younger consumer, I’m inclined to answer that they matter very little. Hotels do seem particularly outdated in some of their infrastructure. I don’t think anyone complains that they can now access their boarding pass on their phone–or for the technophobes, they can print it at an automated kiosk at the airport.
CR’s question of privacy is the more controversial one to me. Knowing my behavior in a hotel room is akin to knowing my behavior in my home or my bedroom. Do I want Marriott to know? I err on the side of full disclosure but perhaps that’s because I can’t yet see where it may lead. Hotels will have to walk a fine line between personalization and privacy.
This was a very interesting read! I especially liked your question of whether a kind gesture is less meaningful if was purely data driven, instead of someone remembering what kind of wine I like at a hotel. I disagree with Jeff’s perspective that human contact matters very little to the customer, to the contrary the reason why platforms like airbnb have been so successful is become people are looking for authentic experiences and in my opinion, authenticity comes from human contact. Additionally, per the Bill Marriott quote in your post, more people spend time looking at their phone which results in less human interaction. I believe Marriott can differentiate itself from other hotel chains and home sharing platforms by investing in providing personalized and data driven customer service that is based on “authentic” human interaction.
CR, such an interesting topic! I think you hit the nail on the head identifying the two key issues here: privacy and human touch.
As far as privacy is concerned, I think Ron Harrison, Global Design Officer for Marriott’s Global Design, gave the easiest and at the same time most correct solution when he came to class this week: “we will get as much information as you will decide to share with us.” In other words, it will be key to let the client decide what to share and not to share with the hotel. Today, Marriott through its loyalty program (Marriott/SPG) asks customers many information that already uses to improve their stay. Many questions concern their preferences (e.g. proximity of the room to the elevators, top floor option, check-in/check-out time preference). Moreover, if you are a usual customer (e.g. business traveler) Marriott will try to accommodate you in the same room every week to give you a sense of continuity, and if it’s your birthday you may even find a surprise on your pillow! My belief is that if the customer has agreed to share certain data with the hotel, then the hotel can and should use that information to make the experience more enjoyable, and I can totally see a future not so far away in which many more habits and preferences are captures, stored, and used.
Speaking of “human touch”, I do believe personal interactions are necessary, especially in the hospitality business and even more in the high-end market. At the same time, I can see a great upside in digitization that simplifies life for both customers and hotel staff. There are many low value added activities that can be eliminated, many others that can be made more “fun” through futuristic innovations. This will enable staff to add value where it is needed, and ultimately to never lose personal connection with clients.
I really enjoyed reading this, especially given the class we just recently had regarding Marriott and their usage of digital innovation to compete with AirBnB – hope you got to speak with Ron Harrison before he left! Completely agree that there’s a delicate balancing act between being data driven to provide a more comprehensive customer experience and by being intrusive. As Ron mentioned in class, he does mention that he would not use the data of anyone who might not want to disclose that, so perhaps that’s one way to get around the problem?
That being said, I am concerned about the future of this digitization and automation. In Japan’s Hen-na Hotel, they’ve taken digitization to a new level and eliminated some of the traditional human facing activities like check in – robots will check guests in, and give them the appropriate key card based on facial recognition. Given that I believe the trend is towards digitization, I worry about the amount of information hotels will possess of each individual guest, and the possibility of hacking into the system.
Source: http://www.h-n-h.jp/en/concept/
Caty, this was really well researched and analyzed, I really enjoyed reading it! I agree that this will be really important to delivering on Marriott’s customer promise to its core business customers of convenience, mass customization and expediency! I’ve definitely been the person in your example – arriving past midnight on a transatlantic flight and going straight to my hotel room with the Apple digital key! It’s amazing how saving 10 minutes feels when you’re already tired!
It also opens up the broader question about the jobs that get automated out of the hotel business. It will certainly leave Marriott open to politically implications. AirBnB’s is already writing open letters to Marriott’s CEO noting “I was not surprised that you are unwilling and unable to defend your industry’s longstanding commitment to price gouging consumers, depressing wages and replacing workers with robots.”[1]
It’ll be an interesting leading indicator to what Uber will face when they rollout autonomous cars!
(1) Bosa, D. (2017). Airbnb lashes out at Marriott as clash between Silicon Valley and the hotel industry intensifies. [online] CNBC. Available at: https://www.cnbc.com/2017/11/20/airbnb-wrote-a-letter-to-marriott-claiming-hotel-fleeces-taxpayers.html [Accessed 2 Dec. 2017].
Very apropos article to read after the Marriott case this week! Your article and the comments above touch on two key questions for me.
First, are human interaction and convenience mutually exclusive? Jeff believes human interaction is unnecessary while EMC argues the opposite. Second, to what extent are we as consumers comfortable with sharing our private data? To me, the key factor is the level of awareness we have that we are losing out on either the human touch or ease of transaction. I tend to think that, even if a hotel is fully automated, if it can successfully create the illusion of human interaction, the consumer will be none the wiser.
Something not discussed is how digitization of the hospitality experience affects the user experience over the long term. I would argue that the level to which the industry can “delight” its consumers inevitably declines if the industry continues to rely solely on data collected from past interactions. Once the customer sees a consistent pattern in service, his or her utility from each subsequent interaction will decline as the experiences become predictable and rote. I would take from a lesson we learned in Marketing that we can use all the data we want to inform our decisions, but data in itself cannot innovate. Rather, to consistently attract customers back to its hotels, Marriott and other hotel chains will always need human agents who can identify and test new trends, vet the conclusions drawn from data analytics, and supervise the service provided.