Thursday 23 March 2017

Artificial intelligence will take the toil out of travel, predicts Booking.com ceo

Gillian Tans is ceo of Booking.com, the world's biggest online booking engine. As well as keeping profit levels steady for the company's $75bn parent she must now grapple with robots, writes Adrian Weckler

Booking.com ceo Gillian Tans said changing business demands have meant that the company now finds itself needing to employ more data scientists
Booking.com ceo Gillian Tans said changing business demands have meant that the company now finds itself needing to employ more data scientists

The chief executive of the world's biggest online hotel booking service is not in an acquisitive mood.

"No, we're not considering any acquisitions at present," Gillian Tans says.

This is mixed news for Irish rivals of Booking.com, particularly Dublin-based Roomex.com. On one hand, it means that Roomex, which services about 550,000 hotels and has just closed a fresh €3.5m funding round, can concentrate on building up its own unique long-term offering instead of being focused on flipping the business. On the other hand, it means that Jack Donaghy's company has one less Plan B route if he and investors want to cash out some time soon.

But Ms Tans, who has become one of the most senior female chief executives in the global travel industry since she joined Dutch-based Booking.com in 2002, has other things on her mind than scooping up smaller players.

Chief among them is how the Priceline-owned company's online engine is building in technology to let people talk naturally into their phone to organise and book detailed travel itineraries.

This is no small undertaking. Booking.com is responsible for 1.1m rooms reserved around the world every day. It has 1.1m properties on its books and is now building in services such as taxi hire.

So introducing the type of artificial intelligence that lets people think they're interacting with a person is an ambitious task. But Tans doesn't think that she has any option if her company is going to keep its place at the top.

"Eventually, people should just say 'give me the best hotel in a certain date in a certain location'," she says. "We're testing this kind of software for our booking assistant, which is basically conversational artificial intelligence. We've gotten as far as being able to automatically translate content to customers when they order their room services or a restaurant. These are basically AI techniques."

Tans says she expects the full artificial intelligence package to be hitting Booking.com by 2020.

But one of the problems that comes with artificial intelligence, and robots in general, is the effect on human employment. If a machine is smart enough to interact conversationally with someone on a booking query, why do we need a human in a call centre?

Booking.com employs almost 14,000 people. Will it have to slash and burn through its workforce if artificial intelligence becomes the new standard? "It's difficult to say," says Ms Tans. "I still think you will need people to help in the background. With any previous transition we made with technology, it hasn't been the case that we need less people."

None of that technology was specifically aimed at replacing humans as is the case with robots and artificial intelligence. Nevertheless, Ms Tans is optimistic that new systems will inevitably need new people to run them.

"Maybe the type of position will change," she says. "For example, we now need much more data scientists which is very different from a few years ago. If you think about our business, it's growing and so is the range of products we're offering now."

Ms Tans says she hasn't seen any significant shift in business after Brexit. She also doesn't think there's any particular squeeze on hotel room supply in Europe.

"I don't think that's a problem at the moment," she says. "Maybe some of the faster-growing cities like Amsterdam or London, but not in general."

She says she doesn't have particular insight into the Irish or Dublin hotel supply system. However, there is some irony in the fact that we are talking in Lisbon after the Web Summit, which left Dublin partially because of a lack of accommodation inventory.

Ms Tans is one of the longest-surviving senior female executives at the top of the travel industry. She joined Booking.com in 2002 when it was a small outfit serving a few hundred customers. Today its customer base is in the tens of millions, with properties listed in over 200 countries.

Three years after joining the company, Ms Tans was part of the team that sold the firm to Nasdaq-quoted Priceline for $135m (€126m). Since then, it has fed huge profits into its parent company and swept a host of rivals aside. Priceline now has a market capitalisation of $75bn (€70bn) and is the world's third-largest ecommerce company behind Amazon and Alibaba.

Ms Tans has personally benefited from this, holding around $8.3m (€7.7m) in shares at the company. In the last three months, she has sold shares netting around $570,000 (€531,000)

Earlier this year, Ms Tans rose to become chief executive of Booking.com after the previous ceo Darren Huston, stepped down after a company investigation found he had broken a code of conduct through an inappropriate relationship with a company employee.

Ms Tans is conscious of her position as a woman in a senior industry role.

"I think it's important to be visible and show others that are executives," she says. "If you look around Booking.com, it's a very gender-balanced company."

Although she speaks English, German and French, Ms Tans still retains a strong Dutch accent.

She says that while 2017 won't see any immediate acquisitions for the company, she is conscious of business travel as an important niche market. "One in five of our customers books for business," she says. "But it's scaling very fast. As a result, we have tools for medium or small-sized companies to allow them set their price and give basic reporting functionality. We're expanding that now."

This feeds into what the company calls the 'bleisure' boom. Half of business travellers extend their business trips to take in a holiday element, according to company research. And three quarters are likely to do so the same or more in the coming year.

Will they soon be booking with cyborgs?

"We don't want to put technology out to customers if we're not sure how it's going to be today," she says. "We serve so many customers that we need to make sure it works perfectly."

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