How Hotels Can Leverage AI Like Booking.com and Expedia: Lessons from Industry Leaders

In today’s fast-evolving digital landscape, artificial intelligence (AI) is no longer a futuristic concept—it’s a powerful tool reshaping industries, especially travel and hospitality. Leading online travel agencies (OTAs) like Booking.com (Booking.com shares progress on AI initiatives | PhocusWire) and Expedia (Expedia Group CEO outlines three strategies for using AI in the year ahead | PhocusWire) have been at the forefront of integrating AI into their operations, using it to enhance personalization, optimize pricing, and improve customer service. For hotels, these advancements present a valuable opportunity to learn and adapt similar strategies to stay competitive and meet the ever-growing expectations of modern travelers.

This article explores how hotels can take inspiration from Booking.com and Expedia’s AI-driven approaches to transform their operations, boost guest satisfaction, and increase revenue. By focusing on three key areas—personalization, pricing, and customer service—hotels can unlock the potential of AI to create more seamless and tailored experiences for their guests.

Personalization: Crafting Tailored Guest Experiences

What Booking.com and Expedia Are Doing

Both Booking.com and Expedia leverage AI to deliver highly personalized experiences to their users. Through machine learning algorithms, they analyze vast amounts of data—such as past bookings, search behavior, and user preferences—to recommend properties, destinations, and even specific room types that align with individual traveler needs. For example, Booking.com’s AI-powered recommendation engine suggests accommodations based on factors like location, price range, and amenities, while Expedia uses AI to curate travel itineraries that match a user’s interests and budget.

How Hotels Can Apply This

Hotels can adopt similar AI-driven personalization strategies to enhance their direct booking channels and marketing efforts. Here’s how:

• Website Personalization: By integrating AI into their websites, hotels can create dynamic, personalized experiences for visitors. For instance, AI can analyze a guest’s browsing behavior and past stays to recommend specific room types, packages, or add-ons (e.g., spa services or dining options) that match their preferences.
• Targeted Marketing: AI can help hotels segment their audience more effectively and deliver personalized email campaigns or social media ads. For example, a hotel could use AI to identify guests who frequently book family-friendly rooms and send them tailored promotions for upcoming school holiday periods.
• Loyalty Programs: AI can enhance loyalty programs by predicting which rewards or perks are most likely to resonate with individual guests. This could include offering personalized discounts, room upgrades, or exclusive experiences based on their booking history and preferences.

Example in Action

Imagine a boutique hotel that uses AI to analyze guest data and discovers that a significant portion of its clientele is business travelers who value fast Wi-Fi and early check-in options. By personalizing its website to highlight these amenities and offering targeted promotions (e.g., discounted rates for early bookings), the hotel could see a notable increase in direct bookings from this segment.

Pricing: Optimizing Rates for Maximum Revenue

What Booking.com and Expedia Are Doing

AI plays a crucial role in how Booking.com and Expedia manage pricing. Both platforms use sophisticated algorithms to adjust rates in real time, taking into account factors such as demand fluctuations, competitor pricing, and user behavior. For instance, Booking.com’s AI-driven pricing tools help properties optimize their rates by analyzing market trends and predicting future demand. Similarly, Expedia’s AI models assess millions of data points to ensure that the prices displayed are competitive and appealing to travelers.

How Hotels Can Apply This

Hotels can harness AI to refine their pricing strategies and maximize revenue. Here are some practical applications:

• Dynamic Pricing: AI can enable hotels to implement dynamic pricing models that adjust room rates based on real-time demand, local events, or even weather conditions. For example, during a major conference in the city, AI could automatically increase rates for remaining rooms as availability decreases.
• Competitor Analysis: AI tools can monitor competitor pricing across various channels and provide insights into how a hotel’s rates compare. This allows hotels to make data-driven decisions on whether to match, undercut, or premium-price their offerings.
• Personalized Discounts: AI can help hotels identify guests who are more price-sensitive and offer them targeted discounts or flash sales. Conversely, for guests who prioritize luxury or unique experiences, hotels can maintain higher rates while emphasizing value-added services.

Example in Action

Consider a beachfront resort that uses AI to analyze booking patterns and local event calendars. The AI system detects an upcoming music festival and predicts a surge in demand. In response, the hotel adjusts its rates for the festival weekend, increasing prices for standard rooms while offering a slight discount on suites to attract higher-spending guests. As a result, the hotel achieves higher occupancy and increased revenue per available room (RevPAR).

Customer Service: Enhancing Guest Support with AI

What Booking.com and Expedia Are Doing

Both Booking.com and Expedia have integrated AI into their customer service operations to handle routine inquiries and improve response times. Booking.com, for example, uses AI-powered chatbots to answer common questions about bookings, cancellations, and property details, freeing up human agents to handle more complex issues. Expedia has also embraced AI for customer support, using it to automate responses and provide 24/7 assistance to travelers.

How Hotels Can Apply This

Hotels can leverage AI to elevate their customer service, ensuring guests receive timely and efficient support. Here’s how:

• AI-Powered Chatbots: By implementing chatbots on their websites or messaging platforms, hotels can automate responses to frequently asked questions, such as check-in times, parking availability, or dining options. This not only improves response times but also allows staff to focus on more personalized guest interactions.
• Sentiment Analysis: AI can analyze guest reviews and feedback across multiple platforms to identify common pain points or areas for improvement. For instance, if multiple guests mention slow Wi-Fi in their reviews, the hotel can prioritize addressing this issue.
• Proactive Support: AI can help hotels anticipate guest needs by analyzing booking data and behavior. For example, if a guest frequently requests extra pillows, the hotel can proactively offer this during their next stay, enhancing the overall experience.

Example in Action

A mid-sized hotel chain implements an AI chatbot on its website to handle pre-arrival inquiries. The chatbot efficiently answers questions about amenities, local attractions, and booking modifications, reducing the workload on front-desk staff. Additionally, the hotel uses AI to analyze guest feedback and discovers that many guests are dissatisfied with the breakfast options. In response, the hotel revamps its breakfast menu, leading to improved guest satisfaction scores.

Conclusion: The Future of AI in Hospitality

As AI continues to evolve, its potential to transform the hospitality industry becomes increasingly clear. Booking.com and Expedia have set a strong example by integrating AI into their operations to deliver personalized experiences, optimize pricing, and enhance customer service. For hotels, the key takeaway is that AI is not just a tool for large OTAs—it’s an accessible and powerful resource that can be tailored to meet the unique needs of any property, regardless of size.

To stay competitive in a digital-first world, hotels must start exploring AI-driven solutions that align with their business goals and guest expectations. Whether it’s personalizing the booking journey, refining pricing strategies, or automating customer support, AI offers a pathway to greater efficiency, higher revenue, and more satisfied guests.

Now is the time for hotels to embrace AI—not as a distant innovation, but as a practical and essential part of their operations. By learning from industry leaders like Booking.com and Expedia, hotels can position themselves at the forefront of the next wave of hospitality innovation.

Call to Action

• Start Small: Begin by identifying one area—such as personalization or customer service—where AI can make an immediate impact on your hotel’s operations.
• Explore AI Tools: Research AI-powered solutions tailored to the hospitality industry, such as chatbots, dynamic pricing software, or guest feedback analysis platforms.
• Invest in Training: Ensure your team is equipped to work alongside AI by providing training on how to use these tools effectively.

By taking these steps, hotels can unlock the full potential of AI and create unforgettable experiences for their guests.