Luxury Unfiltered: The misstep luxury hotels are making with their AI strategy

January 21, 2026

Daniel Langer is the founder and CEO of consulting firm Équité

My professional life involves staying in several luxury hotels every month.

Most of these properties describe themselves as the pinnacle of hospitality, yet as a guest, I often encounter a profound sense of sameness.

The ambition is laudable, but the execution frequently lacks intrigue or inspiration.

The fallacy of the seamless stay
I find very little surprise and inspiration in many so-called luxury hotels. At the same time, I am engaged in weekly discussions with hospitality groups and other luxury brands regarding artificial intelligence.

I witness a pervasive desire to utilize these tools for efficiency gains and cost reductions. This operational efficiency focus is not just a tactical error.

It is a billion-dollar mistake that is actively destroying the long-term asset value of the world's top hospitality groups. The calculation is simple and terrifying.

Luxury pricing power relies entirely on the presence of extreme value and emotional resonance. When a hotel brand invests millions to automate the guest journey and remove every moment of human friction, they are effectively commoditizing their own product.

They are using their own capital to erase the only differentiator that justifies a premium rate. Importantly, once the experience becomes seamless and robotic, the brand loses its pricing authority.

The billion-dollar loss comes not just from the wasted technology investment, but from the permanent erosion of brand equity and the inevitable compression of margins that follows.

Luxury is defined by the presence of the unexpected. When a guest experiences a perfectly seamless stay managed by an algorithm, they feel the absence of care.

They sense that they are being processed by a machine rather than hosted by a person. Hence, the leaders who push for a frictionless, automated experience are unwittingly guiding their brand into a trap.

To avoid this, AI should be used to remind staff at the right moment of what matters to the guest and to calculate the optimal moments for human intervention. This is the choreography of the human moment.

Instead of predicting what a guest wants to order, the AI should analyze behavioral data to signal to a butler when the guest is most likely to appreciate a ten-minute conversation or a personal recommendation.

This approach uses technology to create a digital sanctuary where guests are liberated from the relentless noise of the modern world. In their daily lives, these individuals are bombarded by notifications and algorithmic suggestions.

They are exhausted by the constant digital demands on their attention. A luxury hotel should be the one place where that noise stops.

Therefore, the role of AI is to act as a digital shield that filters the outside world while providing staff with the insights needed to create a sense of profound, analog peace. It is the use of a technology stack to facilitate a simple and perfect interaction between two people.

Orchestrating the return of the soul
The most intriguing application of AI for a luxury brand is measuring social capital.

Most hotels measure revenue per available room or guest satisfaction scores. These are lagging indicators that tell you nothing about the emotional equity of the brand.

A sophisticated AI strategy would instead measure the ROI of a conversation. It would analyze which human interactions led to the highest levels of long-term loyalty and emotional resonance.

This allows management to stop treating labor as a cost center to be minimized and start treating it as a value creator to be maximized.

Importantly, this requires the confidence to be strategically inefficient. A staff member who spends twenty minutes discussing a passion for rare books with a guest is technically inefficient according to traditional metrics.

However, that interaction is the only thing that creates a lasting memory that transcends the physical property. AI can identify these opportunities by connecting the dots between a guest's public profile, past preferences, and current mood.

The result is a level of hyper-relevance that feels like magic to the guest because they never see the machine that enabled it.

The strategic value of the unexpected
Absolute predictability can be the enemy of inspiration. If a guest knows exactly what to expect from a brand because the AI has optimized the experience to a point of perfect consistency, the brand has lost its ability to surprise.

Luxury thrives on the unexpected and the slightly imperfect. Hence, the AI should be used to introduce controlled serendipity into the stay.

This might mean identifying a specific time when a guest would appreciate an unexpected invite to an art exhibition or an impromptu notification to join a yoga class that was not on the itinerary.

This is the ultimate competitive advantage for a luxury hotel. While the rest of the industry is racing to become a high-end version of a frictionless terminal, the leaders will be those who use technology to rediscover the soul of hospitality.

The human factor is not a problem to be solved with automation. It is the only asset that the internet cannot commoditize.

By turning the AI inward to support the staff, the hotel can ensure that the guest experience remains deeply and beautifully human.

Luxury Unfiltered is a weekly column by Daniel Langer. He is the CEO of Équité, a global luxury strategy and creative brand activation firm, where he is the advisor to some of the most iconic luxury brands. He is recognized as a global top-five luxury key opinion leader. He serves as the executive professor of luxury strategy and pricing at Pepperdine University in Malibu and as a professor of luxury at New York University, New York. Dr. Langer has authored best-selling books on luxury management in English and Chinese and is a respected global keynote speaker.

Dr. Langer conducts masterclass management training on various luxury topics around the world. As a luxury expert featured on Bloomberg TV, Financial Times, The New York Times, Forbes, The Economist and others, Mr. Langer holds an MBA and a Ph.D. in luxury management and has received education from Harvard Business School. Follow him on LinkedIn and Instagram, and listen to his Future of Luxury Podcast.

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