Lacking the personal touch

May I show you to your room?

Generally speaking, hotels love to talk up the ‘people skills’ of their staff when they are promoting their services.

Not so at Flyzoo, Alibaba’s new unmanned hotel in Hangzhou. There, the front-of-house work is done by robots and by sensors relying on artificial intelligence.

If all goes well, the only humans at the hotel are the guests.

Flyzoo, or Feizhubuke in Chinese, was two years in the making as a concept. The idea is that it will showcase the full range of Alibaba’s services: everything from the furniture sold on its e-commerce platform Tmall through to the intelligent machines from its new Damo Academy that do much of the work.

Bookings for the hotel are handled through the Alibaba travel portal Fliggy and customers enrolled in the company’s Sesame Credit scheme can get preferential rates if they have a good credit score.

What is a stay in the hotel actually like? Well, no one will know for sure till it opens on December 12. But according to promotional material, check-in is akin to going through an automated immigration channel at an airport. Sensors scan the guest’s face and make sure it matches the image and information on their ID cards. Facial recognition also serves as a “key” for opening doors, operating the lift and adding things to the hotel bill.

Guests are escorted to their rooms by grey robots – think a slimline R2-D2 – and there they can control the air conditioning and order room service via Ali Genie – Alibaba’s answer to Amazon’s virtual assistant Alexa.

Even room service will be delivered by robots, the hotel says.

“By improving the management system, the efficiency of these futuristic hotels can be 1.5 times that of traditional hotels of the same grade and scale,” predicts Wang Qun, the hotel’s CEO

Of course, what the company is playing down is the presence of more traditional staff behind the scenes. As Wang said himself at the World Internet Conference two years ago, automating environments like a Chinese kitchen is impossible (rather undiplomatically, he ventured that Western cuisine could be made by robots, however).

Wang has said Alibaba hopes to sell its solution to an industry that could run into staff shortages as the labour pool starts to tighten up over the coming years.

China boasts about 15 million hotel rooms – roughly three times the number in the US – and has another 480,000 under construction, according to studies by Shanghai Inntie Hotel Management Consulting and Lodging Econometrics.

But as the economy slows, some are predicting leaner times for the hospitality industry. Earlier this month shares in Ctrip, Asia’s largest online travel agency, fell 19% in a single trading session when it lowered its forecasts for the fourth quarter. Alibaba and Baidu have also warned that sales growth could slow as people cut back on discretionary items (for more on this topic, see Talking Point on page 1).

One man who believes there is still plenty of room for success is Ritesh Agarwal – the founder of India’s Oyo Rooms. Oyo opened it first hotel in China a year ago and it already operates more than 50,000 rooms – putting it in the top 10 of China’s largest hotel chains.

Oyo, which operates on a franchise model, is strictly targeting budget travellers – with prices per room starting at around Rmb100 a night. Reuters reports that in September the chain raised $1 billion from Japan’s SoftBank and other investors to assist with its expansion goal of adding 30,000 rooms a month to its portfolio and Agarwal says the aim is to become China’s largest hotelier (by room numbers), overtaking entities such as the Huazhu Group, which owns, among other brands, the budget chain Hanting Express (see WiC423).

“We believe eventually we will get there,” the Financial Times quoted Agarwal as saying in September.

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