AI transform large hotels offer dynamic pricing for customers

Artificial Intelligence (AI) is transforming the hotel industry by enhancing efficiency, personalisation and guest experiences. Now, going a step further it is helping some of the large hotels in dynamic pricing by analysing occupancy rates, demand trends and market fluctuations to offer daily real-time pricing recommendations rather than season-based pricing.

AI-powered virtual assistants can handle guest inquiries, provide information and even assist with check-in and check-out processes. However, some of the large hotel chains like Radisson Hotel Group are using AI to a large extent, chains like IHG Hotels and Resorts are using AI in bits for dynamic pricing. Interestingly, a small hotel chain in the temple town of Madurai in Tamil Nadu is soon planning to use AI in getting dynamic pricing.

Dynamic pricing will help hotels optimise revenue by adjusting rates to match demand levels, preventing both overpricing and underselling. This will in turn help in maximising profitability.

Nikhil Sharma, Managing Director and COO, South Asia, Radisson Hotel Group, said the group is leveraging AI to revolutionise dynamic pricing on a daily basis. Traditional revenue management strategies relied on historical data, manual forecasting and fixed pricing models. Now, AI enables us to analyse real-time data, predict demand, and dynamically adjust room rates with unprecedented precision.

The group’s AI-driven revenue management systems actively assess market trends and guest demand, allowing it to make complex pricing decisions that were previously handled manually, he told businessline.

Globally, the group is using AI in hyperdynamic pricing for revenue management, smart HR recruitment systems, and intelligent automation in travel advertising, which improves channel positioning and generates higher revenues. By utilising advanced analytics, predictive modeling, and machine learning, we continuously refine our pricing strategies to maximise occupancy, enhance guest value, and drive higher profitability, he said. “As we scale these innovations across our portfolio, AI remains a crucial enabler in delivering smarter, data-driven pricing decisions every day,” he added.

Sudeep Jain, MD, South West Asia, IHG Hotels & Resorts, who was in Chennai recently, said, “We have actually taken use of some bits of AI and machine learning to create Revision, which is our revenue management system.”

The airlines are well ahead of the hotel industry in terms of hour-to-hour basis prices that would change for them. The restaurants are a little behind because the menu prices are fixed for a very long time although people are now exploring the ability to dynamically price that. “We are somewhere in the middle where we would like to do dynamic pricing. We would love to be able to dynamically price, probably on a 4-hour window or 6-hour window,” he added.

Krishna Kumar Balaraman, a faculty at IIT Jodhpur with interests in technology foresight and AI strategies, said AI has taken the dynamic pricing model and strategies to a new level. With the availability of real time data and advanced machine learning techniques, hospitality businesses including hotels, can now concentrate more on curating specific customer experiences and maximise occupancy rate matters with optimal pricing leading to better profits.

In addition to advanced demand forecasting and revenue optimisation, AI can also be used by hotels for productive maintenance and housekeeping, and security among others. There are a host of AI based dynamic pricing services available which hotels can explore and adopt. AI can help hotels do what they should do best – focus on customer delight, he said.

Published on April 10, 2025