The Future of Travel Booking: Why AI Companions Will Make Direct Bookings the Default

TL;DR: AI travel companions are set to revolutionize the travel industry, with Google, AI leaders, and Online Travel Agencies (OTAs) racing to develop the most sophisticated AI-powered travel companion. Google is ahead in this race. And as AI becomes the go-to for personalized travel planning, direct bookings could surge to become the new default. To capitalize on this trend, brands must optimize for AI discoverability and offer a seamless direct booking experience. hostAI is your readiness partner.

Travel Planning Today: A Fragmented Experience

If you’ve ever tried to plan a vacation, you know the drill: countless hours spent scouring dozens of websites, searching for the perfect flights, accommodation, and activities. It’s a dizzying array of options, prices, and reviews that can leave even the most seasoned traveler feeling overwhelmed and frustrated.

On average, planning a trip requires 30 sessions across 12 different sites. You’d likely start your search on Google, then move on to an Online Travel Agency (OTA) like Expedia, Booking.com or Airbnb. After making a list of options, you get vetoed by your fellow traveler(s), so you start over with refined criteria. Finally, you find the perfect place to stay, but have an uneasy feeling about the price. Comparing prices across sites reveals wide discrepancies, leaving you with more decisions to make — and you haven’t even started thinking about what to do when you get there.

All of this back-and-forth is not only time-consuming, but it can also lead to missed opportunities. That perfect vacation rental might get booked while you’re busy comparing options. Or you might book a non-refundable option, only to find a better deal later on. It’s clear that the current state of travel planning is broken.

We are all desperate for a better way — one that saves time, money, and hassle. We want a personalized, seamless experience that takes the guesswork out of travel.

Enter AI-powered travel companions. With the ability to process vast amounts of data and learn from user preferences, these assistants have the potential to revolutionize the way we plan and book travel. But what exactly will they look like, who is best positioned to bring them to market, and what does that mean for travel accommodation brands looking to connect with their ideal guests? Let’s dive in.

The Promise of AI: Your Perfect Travel Companion

Imagine having a travel buddy who knows your preferences inside and out, from your favorite airline seats to your ideal hotel room type. A companion who’s always on the lookout for the best deals and experiences, tailored just for you. That’s the promise of AI in the travel industry.

At its core, an AI travel companion would be hyper-personalized. By learning from your past trips, stated preferences and implied purpose for your coming trip, it would gain a deep understanding of what makes your perfect travel experience. Heading to the beach with your family? Your AI companion would know you prefer a ground-floor room with easy pool access. Planning a romantic city getaway? It would recommend the coziest boutique hotels and hidden gem restaurants.

But personalization is just the start. The real power of AI companions lies in their ability to work tirelessly in the background, even when you’re not actively planning a trip. Imagine receiving a notification that your dream safari adventure is on sale, or that a new hotel has opened up in your favorite ski town. Your AI companion would be constantly scouring the web for opportunities that match your interests and budget.

Perhaps most exciting is the potential for AI to bridge the gap between dreaming and doing. Today, even after you’ve settled on a destination, there’s still a daunting amount of research and planning required to bring the trip to life. But with an AI travel companion, you could simply share your vision — whether it’s a week of relaxation or an action-packed adventure — and let the technology handle the details.

No more sifting through hundreds of hotel options or trying to piece together disjointed activities. Your AI companion would craft a seamless itinerary, optimized for your preferences and constraints. All you’d have to do is show up and enjoy the ride.

Of course, this is all easier said than done. Building a truly personalized, proactive, and comprehensive AI travel companion will require significant advances in AI and AI-first experience design. But AI progresses with dizzying speed. Google is already promising its Gemini assistant to help with your trip planning as early as this Summer. Major Online Travel Agencies (OTAs), like Booking Holdings, Expedia Group, Ctrip and Airbnb have all made AI their top priority. And plenty of start-ups are also in the arena trying things.

The question then becomes: who will bring this travel companion vision to life? As we’ll explore next, the answers may surprise you.

The Race to Build the Ultimate AI Travel Companion

So what will it take to bring the AI travel companion to life? There are a few key ingredients:

First and foremost, data. In order to personalize recommendations, the AI needs to have a deep understanding of your preferences. Historically personalization has been a holy grail in travel. For two reasons. Firstly, your travel data is infrequent (compared to your Amazon purchase on Netflix viewing habits) and its spread across multiple OTAs, giving all a partial view of your preferences. Secondly, there’s little data available on the purpose of your current trip; and this can’t be accurately inferred from your booking history or current browsing behavior.

But data alone isn’t enough. The Travel Companion AI needs to be powered by a state-of-the-art model. It needs to go beyond just handling conversations. It needs to understand your motivations and constraints, be informed by a memory of your preferences, reason effectively to curate the right options and be empowered to take some actions on your behalf.

Of course, all of this sophisticated technology won’t matter if the user experience isn’t seamless and enjoyable. This is where an AI-first design approach comes in. Rather than just layering AI capabilities onto a dry chat interface, the entire user journey needs to be reimagined with AI at the center. From conversational interfaces to proactive notifications to visual inspiration boards, every touchpoint should leverage the power of AI to create a delightful and effortless planning experience.

“There’s an interface paradigm that’s going to be powered by AI, and it’s not a chatbot. Jony Ive doesn’t think so. I don’t think so. No great designer I respect thinks a chat interface is the best interface. You want a chat interface for chatting. But you don’t want a chat interface for a calculator or to find the weather. Every application wants a different interface.”

Brian Chesky on AI-first Design

Finally, to deliver on its promise, the AI needs access to comprehensive inventory. This means not just a wide array of travel options, but deep, real-time data on availability, pricing, amenities, reviews and more. Without this, the AI’s recommendations will be unreliable. Users must have confidence that their companion is considering every possibility and optimizing for their specific needs.

So who has these key ingredients — or the ability to acquire them? The AI leaders (OpenAI, Google and Microsoft), major OTAs, and startups are all vying to assemble the perfect mix of data, AI, design, and inventory. But they’re not the only ones with a stake in this race. For independent hospitality brands, the emergence of the AI travel companion poses both threats and opportunities that cannot be ignored.

The Contenders: Who Will Win the Race?

The race to build the ultimate AI travel companion is heating up, with multiple players vying for pole position. Each brings a unique mix of strengths and weaknesses to the table.

First up is Google, the biggest online travel company and the undisputed king of data. With its vast troves of search, email, and browsing data, Google has an unparalleled view into user preferences and intentions. It also boasts impressive AI capabilities, though perhaps not quite at the leader yet in that arena. Where Google falls short is in user experience; its travel products can feel disjointed and lack the cohesive, AI-first design that a true companion requires. But with solid inventory through Google Flights, Hotels, and Vacation Rentals, it’s a formidable contender. Its recent I/O conference emphasized the priority they are putting on travel; Gemini promised to help you with trip planning as early as this summer.

Next are the big AI players like OpenAI and Anthropic. These companies are at the forefront of AI research, with state-of-the-art models that can understand, reason, and soon take action; in ways that mimic human intelligence. However, they lack the domain-specific user data that’s crucial for personalization. They also have limited experience in crafting travel products and little to no direct access to travel inventory. But their technological prowess makes them wildcards in this race.

The Online Travel Agencies (OTAs) like Booking Holdings, Expedia Group and Airbnb are also in the running. They have a wealth of booking data, giving them some insight into user preferences. However, this data is often fragmented across different brands and platforms. The OTAs will likely need to partner with or acquire AI specialists to keep pace with the latest models; as Airbnb did with Gameplanner. They’ll also need to overhaul their user experiences to center around AI. But their deep industry knowledge and existing relationships with suppliers give them a solid foundation to build upon.

Metasearch engines like Kayak, Skyscanner, and Tripadvisor find themselves on the front lines of this battle. They have good data on user search behavior and access to broad inventory. But like the OTAs, they’ll need to invest heavily in AI talent and user experience redesigns to stay relevant. Their advantage is the will to survive — as AI companions threaten to disintermediate traditional search, these companies will have to innovate to defend their turf.

Finally, there are the startups. These agile newcomers may lack the extensive data of the incumbents, but they have the advantage of being able to design AI-centric experiences from the ground up. Unencumbered by legacy systems, they can move fast and break things. The challenge will be accessing enough inventory and user data to make their AI truly powerful. But with less red tape and a laser focus on the problem, they could make waves.

So who will emerge victorious? It’s hard to bet against Google. The combination of data, AI prowess, and travel inventory makes it the one to beat. And if the other big AI players crack the domain specific requirements, they could leapfrog the entire industry.

The travel industry veterans recognize the threat. If the OTAs and metasearch players don’t successfully harmonize their data, acquire top AI talent, and re-invent their products from the ground up, they could lose more ground to Google.

“with Google’s increasing control and the potential for a “super app” powered by AI, the future of online travel intermediaries remains highly uncertain, posing existential challenges to their business models.”

Rod Cuthbert, The founder of Viator

One thing is certain: the race to build the AI travel companion will reshape the industry as we know it. The question for independent hospitality brands is no longer if this change will happen, but when — and more importantly, how they’ll adapt to this new reality.

The Rise of Direct Bookings in an AI-Powered World

As the race to build the ultimate AI travel companion heats up, an intriguing possibility emerges: the rise of direct booking as the default option for travelers. If Google or one of the big AI players comes out on top, their AI-powered recommendations could significantly shift the balance of power in the travel industry.

Consider this: AI companions have a tremendous advantage over humans when it comes to processing information. They can scan hundreds of sources in seconds, comparing prices, amenities, and reviews to find the perfect match for a traveler’s preferences. When an AI finds the same property listed on multiple channels, it’s likely to recommend the channel that offers the best combination of price and consumer protection.

This is where direct booking could shine. Hotels and Short Term Rental (STR) Managers have long sought to encourage direct bookings on their own websites, often by offering lower rates or exclusive perks. In a world where AI companions are leading travel planning, these direct booking advantages could become even more powerful.

Imagine an AI scanning prices for a bleisure trip to Chicago. It finds the ideal property listed on several OTAs, a metasearch site, and the brand’s own website. The direct price is the lowest by a 10% margin. From the AI’s perspective, recommending the direct booking is a no-brainer — it saves the traveler money while still earning their trust by providing a secure, reputable booking channel.

Of course, this scenario assumes a few key conditions. First, hospitality brands need to ensure that their direct presence is easily discoverable and prioritized by AI companions. This means robust search engine optimization, complete and updated seasonal listing descriptions, and perhaps even direct integrations with AI companions.

Second, hospitality brands must build trust with travelers. Even if an AI recommends a direct booking, the traveler may hesitate if they’re unfamiliar with the brand or unsure about the booking process. Clear communication, strong reviews and ratings, and a seamless, secure booking experience will be essential to convert the guest.

If hospitality brands can meet these conditions, the rise of AI travel companions could be a boon for direct bookings. By offering competitive prices and building trust with travelers, brands could see a significant shift away from OTAs and toward their own websites.

To date, smaller brands often struggled to compete with the marketing might of large chains and OTAs. But in an AI-powered world, a great product at a great price could be enough to level the playing field.

A Call to Action for Independent Hospitality Brands

The AI-powered future of travel is not a distant possibility — it’s an imminent reality. With Google set to launch its Gemini travel planner as early as this summer, the race to build the ultimate AI travel companion is already in its final lap.

While the full vision we’ve outlined may take some time to materialize, independent hospitality brands cannot afford to sit on the sidelines. The potential for AI to upend the travel industry and usher in a new era of direct booking is too significant to ignore.

That’s why we’ve started hostAI — to help short-term rental managers and independent hotels seize this opportunity and make direct bookings the default in travel. Our mission is to empower hospitality brands to showcase their unique value propositions in a way that resonates with both travelers and their AI companions.

We understand that every property has its own special blend of amenities, atmosphere, and local flavor that makes it perfect for certain types of travelers. But expressing those nuances in a way that an AI can understand and relay to potential guests is a complex challenge. That’s where our own proprietary AI comes in.

We understand the unique selling propositions of each individual property and help you express that narrative, ensuring that your properties rise to the top of AI-powered search results. But being found is only half the battle.

To convert AI-driven traffic into direct bookings, hospitality brands need a booking experience that is seamless, secure, and trustworthy. Our white-label storefront is designed with this in mind, providing a branded booking flow that builds confidence and motivates guests to book directly.

The rise of AI travel companions represents a pivotal moment for independent hospitality brands. Those who adapt quickly and position themselves for this new reality will be poised to thrive. Those who hesitate may find themselves left behind.

At hostAI, we’re committed to helping independent brands navigate this transition and emerge stronger than ever. Whether you’re a boutique hotel, a vacation rental manager, or any other type of accommodation provider, we have the tools and expertise to help you harness the power of AI and make direct bookings your default.

To learn more about how hostAI can help your brand thrive in the age of AI, visit gethostai.com.

The future of travel is here. Let’s seize it together.