Wyndham Is Using AI To Lower Costs And Protecting Hotel Owner Margins - Forbes

Artificial intelligence is often presented as a tool for making travel faster and more personalized.

Wyndham Hotels & Resorts is pursuing a more complicated goal: using AI and loyalty data to deliver lower prices and more relevant offers to travelers while helping its hotel owners generate a fair return.

That balance matters for Wyndham.

The company operates approximately 8,000 hotels across more than 100 countries, with roughly 6,000 properties in North America. Although its 25 brands stretch from economy to luxury, Wyndham is primarily concentrated in the economy and midscale segments. Most of its hotels are operated by franchisees, many of whom are small-business owners.

For Scott Strickland, chief commercial officer at Wyndham Hotels & Resorts, the opportunity is to create a system in which value does not have to come at the expense of the owner.

“We call it our owner-first mentality,” Strickland said. “Our owner-first mentality is recognizing that our franchisees are small-business owners.”

AI is becoming one of the tools Wyndham uses to connect that philosophy with the needs of increasingly price-conscious travelers.

Personalization Can Replace The Blanket Discount

Traditional hotel marketing often relies on broad promotions: send the same discount to millions of people and hope enough of them respond. Wyndham is using AI to make those offers more individualized.

According to Strickland, Wyndham has invested more than $400 million over nine years in its technology and data infrastructure. The company now operates one global reservation system and one global customer database across its hotel portfolio.

That foundation allows Wyndham to analyze how individual loyalty members shop and what motivates them to book. One traveler may respond to bonus points, while another is more interested in an immediate price reduction.

“If we’ve seen Jeff and we’ve seen his shopping patterns, and he’s a points guy, he’ll respond if we give him bonus points,” Strickland explained. “Whereas we might know Rob is more of a discount guy. We’re going to give you 20% off because we’ve seen, based on your shopping patterns,” that price is the more effective incentive.

This approach can potentially create a better economic equation. Wyndham does not need to offer every customer the largest possible discount. Instead, it can deliver the benefit most likely to influence that particular traveler.

For consumers, that may mean a lower price or more points. For an owner, it can mean filling a room without unnecessarily reducing the rate for every potential guest.

Generative AI Is Improving Marketing Efficiency

Wyndham is also using generative AI to create and test marketing messages, including email headlines and social-media images.

A loyalty member approaching the next status level might receive a message noting that the member is only one stay away from reaching Diamond status. Other customers could see a discount-oriented headline or an image selected to reflect their demonstrated travel interests.

The technology can test different versions of an image by changing details such as the setting, time of day or people pictured. Wyndham then measures engagement and distributes the version that performs best.

Strickland said social content processed through Wyndham’s generative AI engine has produced click-through rates seven times higher than content that did not receive the same treatment.

Although higher engagement does not guarantee a booking, it can improve the efficiency of Wyndham’s marketing. That matters because reducing acquisition and marketing costs gives a hotel company more room to offer value without requiring franchisees to absorb the entire cost.

Points Plus Cash Creates A More Accessible Price

Wyndham is also using its loyalty program to give travelers more control over the price they pay.

Through its Go Fast points-plus-cash option, members can use a relatively small number of points to reduce the cash cost of a hotel stay. Strickland said the discounts begin at approximately 15% and can reach 25%, depending on the redemption tier.

That structure is particularly relevant to occasional travelers who may not have accumulated enough points for a completely free night. Instead of waiting years to redeem, they can use points sooner to bring a trip within their budget.

Wyndham also avoids dynamic pricing on full award nights. The number of points required falls into established tiers rather than automatically rising for holidays or other high-demand dates. This gives members greater predictability when they earn and save points for a future trip.

The broader lesson is that loyalty programs do not always have to choose between a free night and no meaningful benefit. Partial redemption can make travel more affordable while preserving cash revenue for the hotel.

AI Creates New Revenue Beyond The Room Rate

The owner side of the equation becomes especially visible through Wyndham Connect, the company’s AI-enabled guest communication platform.

Available at approximately 6,000 Wyndham hotels, Wyndham Connect assists guests from 24 hours before arrival until two hours after departure. Travelers can ask when the pool opens, request towels, check their loyalty status or purchase services such as early check-in and late checkout.

More importantly for franchisees, individual hotels can use the platform to sell products and services suited to their guests.

Strickland cited a Wyndham property serving visitors to Sturgis, South Dakota, that offers a four-pack of local craft beer through the platform. Guests can order it before arriving and have it waiting at the hotel. Strickland said the property sells the package at a 50% margin. It can then offer a $10 late checkout the following morning—even when the underlying room rate is only around $60.

The example demonstrates how an owner might maintain an attractive base rate while making a reasonable margin through relevant extras. Unlike traditional resort fees that can surprise or frustrate travelers, these purchases are optional and connected to a guest’s needs.

Wyndham includes the platform in its technology fee and does not take an additional percentage of the upsell beyond its normal royalty structure, according to Strickland.

“That’s theirs,” he said of the incremental owner revenue.

Turning Wyndham Into A Travel Marketplace

Wyndham’s strategy extends beyond hotel rooms. Its platform allows travelers to book flights, rental cars, cruises, trains, attraction tickets and other parts of a trip. Members can earn Wyndham Rewards points on eligible purchases while still earning rewards from some travel providers.

Through the subscription-based Wyndham Rewards Insider program, travelers can also receive discounts on airfare, attractions and other travel products. Strickland said airfare discounts start at 5% and are funded in part by Wyndham’s distribution partner giving up some of its commission.

The ambition is to make Wyndham the starting point for travel planning rather than simply the place consumers visit after choosing their destination, event or flight.

For travelers, the appeal is lower prices, stacked rewards and greater convenience. For hotel owners, the platform can generate more direct relationships, reduce dependence on online travel agencies and create additional opportunities to sell relevant services.

Wyndham’s AI strategy suggests that affordable travel and healthy hotel economics do not have to be opposing goals. Personalization can reduce wasteful discounting, loyalty points can lower a guest’s out-of-pocket cost, and optional extras can help owners generate incremental margin.

The most effective use of AI may not be simply predicting where someone wants to travel. It may be constructing a transaction in which both the traveler and the hotel owner feel they received fair value.