Beyond Big Data: Why Watson is the future
31 JULY 2015 6:05 AM
Designed to take down Jeopardy’s best and brightest, IBM’s Watson technology could change the way guests interact at your hotel.
If you’re still worrying about big data, you’re doing it wrong.
While the oft-misused term and the processes built around it still present value to hoteliers, more beneficial in the long run is cognitive intelligence, which leverages the vast swathes of information inherent in “big data” to present actionable insight in context.
In other words: Cognitive intelligence allows you to ask questions as you would in normal human interaction to return the most relevant answers from massive amounts of data.
You saw it in action if you tuned into U.S.-based quiz show “Jeopardy” during February 2011, when IBM’s artificially intelligent computer program Watson kicked the butts of Ken Jennings and Brad Rutter, two of the most successful champions in the show’s history.
Watson had some unfair advantages in its corner.
For one, it was specifically designed for “Jeopardy” to showcase the capabilities of IBM’s progress in the field of open domain questions answering. (That’s just a fancy way of saying it understands language syntax and context to return relevant response to questions—or answers, in the case of “Jeopardy.”)
For another, it’s able to process the equivalent 49 million book pages within seven seconds. (I can barely get through one paragraph on my Kindle in that time.)
Looking back, poor Jennings and Rutter barely stood a chance.
Why does any of this matter in our industry? Because cognitive intelligence is coming to a hotel near you.
That much was made clear during a keynote at the Revenue Strategy Summit earlier this week, when Marc Teerlink, IBM’s chief business strategist, showcased how the Watson technology can improve the guest experience, encourage repeat visitation and drive revenue. It’s being utilized in two hotel-specific applications.
The first is text-based platform Ivy, by Watson's app partner GoMoment. Here’s how it works: A guest checks into a hotel. Shortly after, she receives a text asking to rate her experience thus far. She responds, and Ivy—using Watson technology—interprets the syntax to provide a relevant, personable response.
The guest complains that the line was too long? Ivy apologizes and pings a real associate to alert him of the guest-facing trouble spot.
The guest was happy but is now hungry? Ivy invites her to try the chef’s special in the hotel restaurant.
The key is that Ivy—or Watson, rather—understands the guest’s text and responds like a real person. Oh, and real people can step in to take control at any point in the process.
The second application comes from WayBlazer, an app that searches through videos, tweets, comments, websites—everything, basically—to serve relevant responses for guests’ inquiries about a given market.
A guest looking for a fun family excursion in Austin, Texas, for instance, receives a curated, contextualized list of the area’s top activities, factoring in things like which venues are open or fit the weather forecast.
In that Austin beta test, Teerlink explained, 86% of users said the app would improve their experience at a hotel.
This is just the beginning, he said. The implications are nearly limitless.
Do they supplant the need for human involvement? No, Teerlink made clear. An oncologist who uses Watson to search through hundreds of thousands of clinical trials must ultimately make the decision for which of them best fits his particular patient.
Watson doesn’t take over, he said. It just helps you make more informed decisions and saves you loads and loads of time. And those are benefits that require little context or further explanation to hoteliers.
Now on to the usual stuff …
What’s making me happy this week?
Vice President Joe Biden might have been pulling from the hyperbole file when he likened LaGuardia Airport to the airports found in a “third-world country” back in 2014, but he wasn’t completely off base. Cramped and congested, with horrific food-and-beverage outlets and little room to roam, LaGuardia has always been my most hated airport. But not for long.
The airport will be revamped to offer double the current operational space for planes in a project worth $4 billion, according to CNN. The renovations will triple the passenger screening space, provide more retail units and offer better connections between terminals. The first phase is set to break ground next year with a planned 2019 opening date.
Stat of the week
$1.8 billion: Customer acquisition costs hoteliers between 15% and 25% of total guest-paid revenue. Each of those percentage points represents approximately $1.8 billion in costs, according to preliminary findings from the 2016 edition of Kalibri’s “Distribution channel analysis.”
Put another way, if hoteliers could decreases customer acquisition costs to between 14% and 24%, they would collectively save $1.8 billion. The more negative spin? If customer acquisitions costs go up to, say, between 16% and 26%, hoteliers could collectively pay and additional $1.8 billion.
That OTAs have continued to gain share in each of the past four years makes the costs landscape a bit more treacherous.
Quote of the week
“We did take the perspective when we bought Kimpton as to whether all the Kimpton properties would remain, and the San Francisco ones were ones we identified as those that would possibly leave.”
—Richard Solomons, IHG’s CEO, regarding the departure of seven Kimpton hotels leaving the system.
Reader comment of the week
“Izmerlian has The Chinese right where he wants them. In spite of a recent mis-step by the Bahamian Government, he knows the Chinese would have a PR DISASTER on their hands if this project really stops. They just can’t let that happen, and the Chinese will have to pony up more cash...and fast. Watch him squeeze them over the next month!”
—Reader and frequent commenter “BobSonn” responding to my column last week on the ongoing sage that is Baha Mar.
The opinions expressed in this column do not necessarily reflect the opinions of Hotel News Now or its parent company, STR and its affiliated companies. Bloggers published on this site are given the freedom to express views that may be controversial, but our goal is to provoke thought and constructive discussion within our reader community. Please feel free to comment or contact an editor with any questions or concerns.