Booking.com’s Nuno Guerreiro on closing the trust gap, the India boom and how alternative accommodation is now mainstream
The conversation with Nuno Guerreiro, regional director for North and South Asia Pacific at Booking.com, covered three key questions – whether AI will actually change how people book travel, whether India is as big an opportunity as everyone now says, and whether a global OTA can compete in Japan’s independent accommodation market.
The AI trust gap and why Japan is a special case
Booking.com’s consumer research across APAC reveals a pattern that is, by now, familiar in broad strokes but striking in its Japan-specific detail. Ninety-one percent of Japanese travelers say they are excited about using AI in travel. Actual usage through the booking journey is considerably lower.
The gap between aspiration and action is, Guerreiro argued, fundamentally a trust problem and in Japan, that problem is sharpened by cultural context. “Japan has very high expectations, high standards and low tolerance for hallucinations in AI. People have a very low tolerance for mistakes.”
The data bore this out across the travel journey. AI usage in Japan was highest at the discovery and dreaming stages – the early, low-stakes end of the funnel where a wrong recommendation costs little. As the journey moved toward booking and commitment, usage dropped sharply. “They will wait and see. As it becomes clearer, more factual, we’ll see growing adoption.”
The specific concern cited most frequently in the research was privacy, followed by job displacement.
Guerreiro read this as explaining the trust gap rather than closing it: “That gap of ‘I want to use it’ versus ‘I’m actually using it and trusting it to make decisions’ is closing as you build the models.”
Booking.com’s own AI integration – a trip planner embedded in the app – is being built on the premise that accuracy is non-negotiable. “If you want to know the cancellation policy, we need to make sure the information we’re providing is accurate. That will decrease the concern.”
The evolution from functional chatbot to genuine conversational assistant requires earning that trust incrementally, use case by use case.
One area where AI is already delivering practical value, and where Japan’s inbound boom creates a specific opportunity, is destination redistribution. Booking.com has 370 million traveller reviews. Surfacing those reviews through AI, in response to queries that might previously have returned only Tokyo and Kyoto results, is how Guerreiro sees the platform contributing to the dispersal of Japan’s now 42 million annual inbound visitors toward the 60 million projected by 2030.
“We can surface welcoming regional destinations to consumers who in the past would only have been thinking about what they’d seen on TikTok.”
On social as a front door, a channel that Asian travel brands have navigated more naturally than Western ones, Guerreiro was candid about Booking.com’s learning curve. Performance marketing built the business. Social is a different skill. The platform has recently announced a partnership with TikTok Go, enabling users to move from a reel to an actual accommodation booking within the TikTok environment.
“We’re exploring and learning. There’s a huge opportunity, but the challenge is how you bring people from scrolling through reels to real bookings.”
India: The market everyone is talking about, and what it actually means
For the first time in 12 years of WiT Japan, India came up repeatedly, not as a future possibility but as a present reality.
Booking.com projects that India will generate 5.2 billion trips over the next five to 10 years, representing approximately $50 trillion in travel value, combining domestic and outbound. Delhi to Tokyo bookings on the platform are up 145% this year.
Travellers who might previously have routed through the Middle East or toward Europe are redirecting within Asia, and Japan is a direct beneficiary. The Asia-to-Asia travel boom, as Guerreiro put it, is real and accelerating.
He pushed back on the concern frequently raised by hoteliers in South-east Asia – that Indian travelers are high volume but low value. India’s emerging middle class is projected to grow by 350 million people over the next five years, all with rising disposable income and evolving travel preferences.
“Maybe they start with more budget choices and then move up to business class and premium. We see the shift of trading up, not just trading down.”
In other words, the Indian traveller you attract today is not necessarily the Indian traveller of 2029, and the operators who plan for that trajectory rather than dismissing the market based on current spending patterns will be better positioned.
The practical implications for Japan are already visible in how Booking.com is adapting its India-facing product. Intergenerational family travel is a dominant pattern. Dietary requirements, particularly vegetarian options, are a significant filter. Reviews from other Indian travellers are especially trusted as a discovery mechanism.
“If I’m an Indian family traveller, I can find relevant family stays outside of Osaka in more regional destinations that satisfy the need for cuisine, the right activities, the right type of property.”
Removing the anxiety of navigating an unfamiliar country for the first time, at scale, through AI-enabled personalisation, is where Guerreiro sees the platform’s most concrete contribution to unlocking the India opportunity for Japan’s regional accommodation providers.
Alternative accommodation: A global OTA’s space to win
In the first quarter earning results, Booking Holdings’ CEO Glenn Fogel had said that the OTA that wins the independent hotel market wins the next era of travel.
Guerreiro said alternative accommodation – ryokans, villas, treehouses, farm stays, apartment hotels – now represents 38% of all transactions on Booking.com’s platform. “It’s arguably mainstream now, not alternative.”
The driver is real demand. Travellers increasingly do not want the cookie-cutter box hotel, he said. They want the ryokan with the onsen, the experience that cannot be replicated in any other country, the stay that justifies the trip.
To meet this demand, Booking.com just launched its “Authentic Japan” initiative, an effort to deepen partnerships with regional and independent properties and surface them to the global demand that the platform reaches.
The question is whether a global OTA can do this without commoditising the very thing it is trying to sell. Said Guerreiro, “There’s a soul in what we do in humanising things. Our Travel Review Awards are about highlighting the properties that provide real experiences to travelers –the ones behind what we can show on the platform. I don’t think we’re standardising everything. I think it’s enabling people to discover destinations and experiences they would never be able to find otherwise.”
There’s no denying the competitive dynamic is intensifying. Airbnb is moving into hotels. Local OTAs have deep existing relationships with independent Japanese properties – ryokans, machiya, minshuku – that a foreign platform has to earn.
But Guerreiro pointed to a gap that global platforms can fill that local ones often cannot: currency. A German traveler with only a credit card, a South-east Asian family wanting to pay in local currency, an Indian traveler navigating FX fees – these are friction points that a platform with global payment infrastructure can smooth in ways that a domestically focused OTA simply cannot. “That’s where we can do the bridging that supports the growth.”
If you had to choose one …
Asked which of the three – AI, India or alternative accommodation – would have the biggest impact on Booking.com’s business over the next three years, Guerreiro declined to choose one. Instead he countered with the argument that AI would be the multiplier.
That it would not be a standalone force but the capability layer that makes India and alternative accommodation scale. The personalisation that makes India’s intergenerational families find the right ryokan in the right region at the right price, in the right language, with reviews from people who share their dietary requirements – that is an AI problem.
And solving it, at the scale Japan’s inbound trajectory demands, is the work of the next few years.
