AI is not killing hotel loyalty programmes. Interchangeable brands are. When an agent shops on price and connectivity, the bland hotel is the first one it swaps out.
Seth Borko, head of Skift Research, said something this week that travel marketers should pin above their desks: the agents are here, and almost no one is ready. He booked his first agentic business trip over text with Instinct — search, compare, book and pay, all in the chat. That is no longer a slide deck. It is a ticket.
The debate is not whether travellers will ever use AI to book. Some already do. The debate is what happens to your brand when they do.
The numbers that should worry brand teams
In his Skift Research newsletter, adapted from his talk at the Skift Data and AI Summit Europe in London, Borko shared the data that matters:
- 55% of travellers said they were likely or very likely to switch brands if AI found a better deal.
- 74% of US travellers agree that many hotel brands feel very similar.
- In Skift’s LLM study for The Mystery of the Disappearing Destination, AI sent 38% of recommendations to the same five destinations, and 48% to the top ten.
- When AI pitched destinations, price (21% of themes) and connectivity (16%) were the most common selling points — a generic way to sell almost anywhere.
Read that again. Travellers already think brands look alike. More than half say they would jump for a better AI-found deal. And the machines often sell places on price and flights, not on what makes them different.
That is not a points problem. That is a brand problem.
Agents are small today. The pool they are chasing is not.
Instinct may be pacing at nearly $500 million a year in travel booking volume, based on the founder saying the app runs at least $1 billion a year in total transaction volume with about half in travel. Against global travel that is still small. Borko’s point is the size of the prize: hotels pay about $30 billion a year in direct distribution costs and about $75 billion in indirect ones — more than $105 billion. If agents took just 10%, that is a $10 billion-plus opportunity.
So no, agents will not swallow distribution overnight. But they do not need to. They only need to sit between the traveller and the booking button often enough that your loyalty app becomes optional.
This is the other side of the story I wrote about Booking’s $100m bet on the trip layer. Discovery is noisy. The relationship after the click is valuable. Agentic shopping attacks both: it shortlists for you, then it can book for you.
My take: loyalty without difference is a coupon
Hotel groups have spent years building points, status and member rates. Those still matter. Friends, family and reviews still outrank AI for trust in Skift and McKinsey’s joint work — AI sits fourth, ahead of travel brands and journalists, but not ahead of people.
But points do not help if the AI never recommends you, or if it recommends you as “similar and cheaper elsewhere”. Overwater bungalows were once French Polynesia’s signature. Now they show up in Jamaica and the Maldives. If a guest cannot tell the experiences apart, how is an agent supposed to?
I have already argued that independent hotels are invisible to AI until they are known, and that buying ChatGPT is not a strategy. This is the next layer: even when AI knows you, it may sell you as interchangeable inventory.
That is how loyalty dies in practice. Not with a dramatic “points are dead” headline. With a quiet swap to the property that was clearer, closer, or £18 cheaper in the agent’s shortlist.
What brands should do now
- Give AI something unique to say. If your pitch is “great location, good value, near the airport”, you are already on the commodity shelf. Put specific experiences, packages and proof on the page in language machines can quote.
- Treat AI visibility as distribution, not a website vanity metric. Reviews, OTA detail and product clarity shape who gets shortlisted. That is GEO work, not another homepage chatbot.
- Keep the human moment where it earns trust. Travellers still want to review before they pay. Make your confirmation, cancellation and service promise the reason they pick you over a lookalike.
- Do not confuse a loyalty scheme with a brand. Status is a reward for people who already chose you. Difference is why the agent chooses you in the first place.
The bottom line
Agentic booking will not flatten every brand tomorrow. It will flatten the ones that already feel the same. Price and connectivity are easy for AI to compare. Character is not — unless you write it down, show it, and make it findable.
The hotels that win the agent era will not be the ones with the loudest chatbot. They will be the ones an agent cannot swap for a cheaper twin.
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