Tomorrow’s technology may already be checking into hotels, although hoteliers might not be aware of it yet, according to panelists at last week’s Southern Lodging Summit @ Memphis.
The speakers on the “Discovering tomorrow’s technology today” panel said the emergence of mobile platforms, online reviews and the sharing economy are forcing hoteliers to face the facts when it comes to technology: Stay on top of it, or fall behind.
Tim Harvey, president & CEO of technology consultancy Core Ideas, said the importance of personal information about guests can’t be underestimated. Hoteliers can differentiate a guest’s experience every time he or she stays by knowing the right information.
“It’s about the customer … giving them choice and control,” Harvey said. “Mobility and how you react to that is probably the biggest trend out there. The biggest opportunity is empowering the guest to do business the way they want to do business operationally.”
“Operations and marketing are blending,” said Flo Lugli, principal at Navesink Advisory Group. “Every single person at your hotel needs to understand how their interaction with the guest affects (the guest) and their impression of the brand.”
Mobile technology was a topic thread throughout the hour-long session.
“Think about how technology can shape (your) business,” said Drew Patterson, CEO & co-founder of CheckMate, a company that specializes in personalizing guest experiences at hotels, and CEO of Room 77, a metasearch site that consolidates available online hotel inventory for consumers. “Through mobile it’s a reimagination of the business.”
“(Mobile) is on everyone’s list,” Harvey said. “The strategies vary, but it evolves around loyalty; it evolves around re-evaluating their core systems. They’re focused on the right areas, but every step forward the third parties have significant amounts of money to invest. They’re tough, tough competitors.”
Lugli said mobile is top of mind for all hotel companies. While at Wyndham Worldwide Corporation, she was involved in a four-year project to revamp content, mobile and the online review process.
“Despite all of those efforts, the statistics show the (online travel agencies) are still winning the battle,” Lugli said. “OTAs grew about 13% last year, and brand.com grew about 6%.”
Lugli said most of the third-party growth came from mobile devices, and the numbers back that up. In June, 43% of all searches were done on mobile devices, she said.
“You have to have consistent experience across all three devices (desktop, mobile and tablet),” Lugli said.
Patterson said there is one simple question hoteliers should be asking: “How do we take these technologies and tools to make them part of our business?”
Putting together the distribution pieces
Moderator Scott Anderson, a hospitality technology veteran who is president of Cruise Inn RV Parks, said another big question for hoteliers comes in the form of distribution practices.
“The one thing they all agree on is they would like to see less business coming from third-party channels without losing any occupancy,” Anderson said.
Harvey said that issue is No. 1 on the major chains’ priority lists.
“It’s about beginning to change themselves instead of dictating how to do business with the customer; how can I create unique experiences to incent them or convince them to buy from me?” Harvey said.
Harvey noted that third-party OTAs are trying to stay one step ahead of hotel companies. One example is Priceline’s recent acquisition of a property management system called Hotel Ninjas. In addition, Priceline also acquired digital marketing platform Buuteeq and restaurant reservation platform Open Table.
“They’re expanding out to even provide more services for the business of the hotel,” Harvey said.
Sharing info about the sharing economy
The sharing economy is having a major effect on the hotel industry as well. Patterson referred to it as “Uberification” of the service economy, pointing to Uber’s redefining of the taxi, private care and ride-sharing industry.
Airbnb’s emergence in the alternative lodging space cannot be taken lightly, the panelists said.
“At the moment the (hotel) industry is at a disadvantage,” Patterson said. “Airbnb talks to 100% of people that stay. Today, we talk to 45%, tops.”
Patterson said the hotel industry must figure out a way to deliver the multichannel experience the millennial generation wants.
“We as hotels haven’t matched that kind of experience (that) allows us to talk to all of our consumers all the time,” Patterson said. “The opportunities come in how we shift loyalty in the general sense because of the experience.”
Jules Sieburgh, another industry technology veteran and principal of Jules A. Sieburgh LLC, said hotel companies are starting to get it, as evidenced by the creation of positions called customer experience manager or chief social media manager.
But there’s plenty more to come, according to the panelists.
Sieburgh said a missing component that is sure to be filled sooner than later is the ability to place video reviews on sites such as TripAdvisor.
“It’s about getting the right (channel-management) mix,” Lugli said. “Making sure you’re getting the right mix from each of these channels, and specifically related to seasonality—when you need them and when you don’t need them.”
Lugli said that until franchisees and franchisors unify to capture information from guests, third-party OTAs will rule the roost. The chasm is created because more than half of the reservations are created by consumers going directly to hotels.
“If we as an industry don’t get over that … and realize our fortunes are tied together … I don’t see how we’ll ever stop these third parties coming into the industry,” she said.
Mobile check-in gains momentum
Meanwhile, the adoption of mobile check-in at hotels is gaining momentum.
Room 77 has auto check-in capability at 100 hotels, and Patterson said 30% of guests use it. The company makes about $10 per check-in from merchandising, room upgrades and other ancillary products.
“Guests have a better experience,” Patterson said. “The question for hoteliers is how do you make technology and this info more a part of operational practices?”
Harvey said hotel brands are catching on, and cited Hilton Worldwide Holdings’ recent announcement that will allow guests to bypass the front desk and go directly to the room by using the mobile phone.
“Six of the top 10 (hotel) companies in the world all are looking at their core systems,” Harvey said, adding that those companies are looking at changing everything from their reservations systems to their social media platforms.
It’s important for hotel companies to explore options and decide whether something like mobile is a fad or a trend. The consensus is that mobile check-in is here to stay, according to the panelists.
“If the customer accepts it, it will be around for a long time,” Sieburgh said. “It’s really the public that defines it.”
That acceptance stretches to online reviews, which are becoming more powerful each day, panelists said.
“The impact of reviews and recommendations on a choice of hotel is huge—in the 60, 70, 80% range, and that’s across every age group,” Lugli said. “It’s important to understand what’s being said and responding appropriately.”
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