Not Done Weekly - Destination AI Summit Recap!

Josiah Mackenzie and Naz Aydin premiered the State of Hotel AI survey at Destination AI. They surveyed 107 hotel company leaders in August and September, led by management companies (33%) and owners or investors (28%).

Among respondents, 63.3% use AI regularly, another 34.7% use it occasionally, and just 1% don't use it at all. More than 80% say it has made their work better, and none said it made their work worse.

This isn't casual use either. 44% of these leaders spend 10 or more hours a week working with AI, and 16% spend 20 or more. 90% say it has improved the time they spend on routine tasks.

Only 12.6% describe their organization as having an AI strategy, governance and scaled execution across functions, while 26.3% run on ad hoc experimentation with no formal strategy. Even having a plan doesn't solve it: among companies with a defined AI strategy and governance, 70% say execution is still fragmented.

On returns, only 24% say their AI investment has paid for itself overall, and 28% say it's too early to tell. 35.2% don't measure AI ROI at all, only 14.1% use defined before-and-after KPIs, and just 5.6% commit AI benefits into business-unit budgets or P&Ls.

That last figure is the whole story. Less than 6% of the industry is putting AI savings where owners can see them: in the P&L.

It isn't the technology

67% cite change management, data quality or systems integration among their top barriers, while only 8% cite the limits of the AI models. Broken out, change management leads at 35%, followed by data quality at 34% and integration at 29%. The data foundation is shaky too: only 42% are confident their data is ready to support their AI goals, and 48% are not.

And look at how people are accessing it. 72% get their AI through general-purpose tools like ChatGPT, Gemini or Copilot, versus 33% through existing hotel tech partners and 16% through AI-first vendors. That's individual productivity, not an operating model. A GM with a ChatGPT login is not an AI strategy.

The money is coming anyway

Here's the part that should worry owners most. No respondent plans to spend less on AI in the next 12 months, and 37% plan to spend more than 10% more. The top goal is cutting costs and improving productivity, cited by 34%, versus 13% for new revenue and 9% for guest experience.

So the industry is raising AI budgets to cut costs while a third of it doesn't measure ROI at all. If that were a capex request, no owner would approve it.

The back office moves first

19% report AI has already redefined corporate roles, versus just 4% for frontline roles.

It's not just one survey

A separate h2c study released the same week found the same pattern: 91% of hotel chains already use AI, but only 28% have a company-wide strategy and just 13% report measurable ROI. Two independent studies, one conclusion: adoption is no longer the problem. Accountability is.

Sources:

• The State of AI in the Hotel Industry – stateofhotelai.com

• HB on the Scene: State of AI in the Hotel Industry – Hotel Business

• Hotels are adopting more AI every day. Will it pay off? – HOTELSMag

• Hotel Revenue Insights, Oct 3 2026 (h2c study summary)\

The Great AI Debate at DAI:

I opened with a critical observation: while the industry has adopted more sophisticated tech stacks, margins have dropped 20% since 2019. Undistributed expenses per occupied room are up 14% YTD 2026 alone, driven by SaaS fees.

• Adam Harris (Cloudbeds): Argued that the industry suffers from "tech piracy"—vendors stacking solutions that don't communicate, leading to data leakage. He advocated for a unified system where the vendor only makes money when the hotel does.

• Jacob DeHart (Stayntouch): Noted that while tech spending is up, hospitality has historically underinvested compared to other sectors. He emphasized the need for scalable solutions to combat skyrocketing labor costs.

• Richard Valtr (Mews): Suggested the industry fails to view software as a solution to operational issues, instead hiring people to manage inefficient processes. He argued for an ROI-centric model where the "Operating System" is paid based on delivered results.

Labor Transformation & AI

The panel addressed the "nasty word" in hospitality: labor reduction. With labor costs approaching 40% of every dollar, the role of AI in automation is central.

• Intuitive Design: Jacob DeHart highlighted the need for "zero-day" training, where staff can use a system immediately without videos or academies.

• Leverage vs. Reduction: Adam Harris viewed AI as a tool to "lift" labor rather than just cut costs, citing a Las Vegas property where AI handled 90% of guest inquiries within nine days.

• The "No Check-in" Goal: Richard Valtr argued for removing the human from the loop in administrative tasks like KYC (identity/payment verification), allowing staff to move from behind desks to guest-facing roles.