Artificial Intelligence Has Reached a Travel Tipping Point

by Richard D'Ambrosio
Artificial Intelligence Has Reached a Travel Tipping Point

Photo: Shutterstock.com


For years now, the travel industry has dabbled with artificial intelligence (AI), seeking to unlock the promise of more efficient communications and greater customer service between travel suppliers, travel agents and consumers.

So far, most of that potential has remained untapped, with only a handful of companies beginning to introduce AI to the booking process in a meaningful way.

But recent investments and beta tests are finally starting to bear fruit. In San Jose, Calif., Casto Travel recently launched the text message-based “Marco,” a mobile travel assistant powered by Mezi, a Silicon Valley startup. Marco was introduced for Casto’s business travel clients and is already completing 60 percent of the current users’ bookings without human intervention, said president and CEO Marc Casto.

Casto Travel's corporate travel clients use “natural language” to make a booking through Mezi, just as if they were emailing or calling a live agent. Users first set up a profile that is activated every time they interact with the system, helping the tool learn about the traveler’s personal preferences so it can apply them to future booking conversations.

The chatbot is monitored by a live agent, who can jump in at any time, said Casto.

“Client feedback has been stellar,” Casto said, noting that working with technology companies in Silicon Valley has helped with the launch.

According to a recent survey by Allianz Global Assistance, 11 percent of Millennials prefer to work with artificial intelligence and chatbots, versus 4 percent of people 35 years of age and older. Twenty four percent of Millennials prefer to use online and instant messaging tools, versus 10 percent of their older peers.

The Marco launch has gone over so well that some of Casto’s clients are using it as a recruiting tool because technology job applicants want to work for companies utilizing high-tech tools, Casto said.

Technology costs affordable to virtually any size agency
Based in Sunnyvale, Calif., Mezi works with a handful of other travel management firms, including Adelman Travel in Milwaukee, Wis. American Express Co. also utilizes Mezi for its Platinum cardmember concierge service.

While most of Mezi’s clients are larger firms, Johnny Thorsen, Mezi vice president of strategy and partnerships, believes AI’s economies of scale have reached the point where virtually any travel agency, no matter what size, can avail themselves of the technology.

“We are at the beginning of a new phase where smaller companies will be able to move faster than the big guys,” Thorsen said. He pointed out how Mezi’s tool offers only three options to customers versus the overwhelming laundry list typically produced by an online travel agency (OTA).

“If I tell you I want to travel at 3 p.m., why is an OTA forcing me to scroll through every option starting at 7 a.m.?” he said. Similarly, “If I have history of booking hotels near sports arenas, don’t make me review 40 recommendations on a map. Show me the hotels near where I’ve already told you I go.”

Smaller agencies can use technology to delight clients
Samantha Ruiz, CEO and founder of Well Traveled, is a semi-finalist for the American Society of Travel Agents’ Entrepreneur of the Year Award. She says agents need tools like AI to better differentiate them from larger firms.

“A lot of small travel brands struggle to differentiate. How do you beat the search algorithms of companies like Expedia and Priceline?" Ruiz said. "You need a tool to enable you to understand what the client’s travel preferences are so you can delight them with great customer service.”

Her company has developed software that reads the web pages a digital traveler visits, and categorizes them to develop a sense of what that individual is looking for. “Travel is missing so much of the first two-thirds of the purchase path because it isn’t capturing this data,” Ruiz commented.

“We want to help travel agents know that this person showed an interest in luxury travel, adventure, Alaska, hiking,” before the agent initiates a booking discussion.

Automating booking will improve the agency profession
Casto and others also are hoping that the introduction of AI will allow travel agents to focus more on 21st century selling and customer service skills, and less on low value-add expertise like GDS skills.

“The presumption historically has been that travel agents, first and foremost, have to know the GDS. But that’s inconsistent with today’s customer service requirements,” Casto said.

To succeed in the coming decades, Casto said, “the successful agent will be someone who loves travel and wants to share their passion and travel knowledge with the world.”

An AI-enabled travel agent “needs to be good at delighting the customer,” said Mezi CEO and co-founder Swapnil Shinde.

Priceline CEO foresees AI crisis managers assisting travelers
Speaking at the Skift Global conference in September, Glenn Fogel, CEO of the Priceline Group, said he foresees AI taking over tasks like rebooking travel plans during weather disruptions, delivering solutions automatically to a traveler’s smartphone.

He gave an example of how today a traveler may receive a notification on the way to the airport that their flight has been cancelled or delayed, but the responsibility is then left to the traveler to rectify the situation.

In response to such a notification, a traveler might feel this way: “I’m already on the way. You told me there is a problem, but you’re not solving the problem. I want that rebooked. When I get off the flight, I don’t want to have to change the car service. I want that automatically done. Move my restaurant reservation to later. I want that changed. Notify the people I was eating with. I want my phone to be the key everywhere.”

However, Fogel is not as confident about how quickly the industry will be able to deliver on AI’s promise. When asked at the Skift forum how close the travel industry is to reaching the AI-enabled Promised Land, Fogel responded: “Not so close. But we are getting there.”

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Tip of the Day

I do think there are possibilities for traveler advisors to make money doing domestic trips. I charge a planning fee for my time and expertise, and then book commissionable hotels and activities that meet the client’s needs.

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