Automating Success: AI & Automation In Nightlife Operations

Since the beginning of the year, large organisations globally have announced massive cost savings due to AI and automation. Chipotle announced that had employed a robo-avocado dicer simply to peel and dice avocados before a human mashes them into guac! Although a tiny step, it’s repeated often enough to help reduce the company’s labour costs by 36%. At the same time, many states are raising the minimum wage payable to hospitality workers, which is putting pressure on hospitality business owners and, naturally, has staff on edge.

In my conversation with Charles Ewudo of PCN Entertainment a couple of weeks ago, we discussed the future of the nightlife industry and the technologies which might come into play in making that future a reality. To expand on that, the focus of this week’s blog is how AI and automation might impact the nightlife industry (for better and for worse) and how you might want to think about using it to stay ahead.

Don’t freak out. Luxury hospitality is inherently human.

We think it’s important to call out that what sets our industry apart from others is that it is deeply rooted in human connection. At their core, acts of service are welcomed because of how they make us feel. The recognition and status that we create for our guests come from well-planned human interactions and, to a large extent, we’re betting that technology won’t replace that.

While the idea  of a robot waiter dancing across the floor seems far-fetched, there are two imperatives for nightlife brands and venues:

1. Upscale nightlife needs to be positioned (priced & executed) as a luxury experience.
2. This match will be won by the businesses who leverage these technologies to create and sustain a competitive advantage.

What are these technologies? We’ll cover a few that are top of mind for us below.

Using Data To Predict Preferences & Churn

Perhaps the most powerful application of AI in nightlife is its ability to collect, make sense of, and repeatedly present high-quality data points. Nightclubs and lounges handle vast amounts of data through reservations, ticketing, guest lists, point-of-sale systems, social media, and customer feedback. But bringing this information together is complicated and time-consuming. How many of you have a Business Intelligence Analyst on your squad?

The right tools leverage algorithms that can make sense of this data to identify patterns and preferences, providing insights that were previously unimaginable. For example, do you know what types of music drive purchase behaviour on certain nights? Which guests would you turn to sell your final tables for a country music-themed event an hour before doors open? Empowered by an understanding of your customers and operations, you’ll be able to tailor your offerings to better meet customer desires.

The collection of historical data allows these tools to become predictive: allowing you to forecast busy periods, leading to better staff allocation and inventory management.

Several months ago, we developed a “smart search,” allowing you to segment your customer profiles with plain language questions. Ask who brought the most guests, spent 5k or more, and only visited on pop nights; those customers who fit the description will be presented and ordered by value.

Automation: Killing Off the Steps That Cost You Money

In an average venue, a dash to the bar and back to fetch a carafe of soda costs 4 minutes. That’s only one-fifteenth of an hourly wage, but we know it’s repeated 15 times per table per night, amounting to 55 minutes per VIP server. When you consider that a server is there to host and entertain, that’s rather a lot of time your guests didn’t get face value service!

The example above is one of hundreds of processes which absorb time, complicate efforts, and distract your teams from the jobs they need to get done. (Others include printed run sheets, WhatsApp chats, not charging upfront, and failure to create and follow a protocol for requesting support.)

Take a look at the physical actions and steps taken by your staff as they follow procedures and serve customers. Focus on bottlenecks and see if you can restack your processes or substitute tools to remove or automate them.

Better still, you can talk to us about the steps we’ve taken to optimise venue workflows.

Handling Reservations: Streamlining the Process

Managing reservations can be a complex and time-consuming task, but AI is simplifying it. AI-powered human voice systems are already handling sales and customer service calls in an incredibly lifelike manner.

Unlike your promoters or reservations teams who sometimes miss a text or fail to return an enquiry (we get it, you’re human), AI agents can handle bookings 24/7: taking deposits, issuing tickets, and optimising seating arrangements based on the size of parties, customer preferences, and real-time availability.

Moreover, with a bit of knowledge about past visits, the AI reservation agent can ensure your favourite table, beverage, or even server is available that night.

"Siri for reservations?" We’ve been experimenting with human voice applications of AI and, frankly, we’re blown away – it’s literally impossible to tell you’re not speaking with a person. We'll soon be piloting a capability that can handle reservations, answer questions about events, and gather deposits and guest lists at any time, day or night. If your booking team doesn’t pick up the phone or tends to let bookings fall through, pick up the phone and get on the pilot.

What Else Is Coming?

This is not an exhaustive list, but with the maturity of data collection and synthesis improving at a rapid scale, here are a few other applications of AI we expect to see:

- Music & Lighting: AI will synthesise bar trade, dance floor congestion, ticketing data, and even overall temperature in the venue to guide the music and lighting towards the optimal combination of energy and spend.

- Enhancing Safety and Security: Already we’re seeing a shift to digital identities and surveillance technology capable of monitoring patrons and staff to ensure safety and ethical standards. We expect AI’s role here to take on more sophisticated predictive activities, such as monitoring crowd density, unusual behaviours that might indicate a security threat, or even risk of infection or intoxication. This would allow security personnel to respond quickly and effectively, enhancing overall safety.

So, What Now?

Even though the cost of living and the costs of running a business continue to grow, we’re betting that differentiation through luxury experience and meaningful personal relationships is the strategy for thriving in the next twelve months.

How your staff can make people feel will allow you to charge outsized fees for your experience, but those venues that take steps to provide tools and space to do this will be the venues that win.