Andrew Metcalfe, chief technology officer at Guestline, highlights some technology trends which hoteliers should consider when reviewing and building their tech stack.
The current landscape of the hospitality industry is one wherein staff turnover requires hoteliers to enable new starters to thrive quickly, and as a result of continued inflation, cost management is key. In both cases, more often than not operators are turning to software to provide the answer to the eternal question: how to be more efficient?
For most operators and indeed the wider economy, 2023 is already looking quite different to how we anticipated things at the start of 2022, certainly before the latest phase of the Ukraine War and the subsequent hike in inflation.
As a result, there are now a number of trends entering the market ahead of the peak summer season which hoteliers should be aware of when undergoing any reviews of their solutions and processes.
The streamlining trend of the end-to-end guest journey and preference for one vendor with all the requisite parts to make a reservation status accurate, is set to have greater influence on what we expect to see as greater streamlining and consolidation across all channels of guest interaction.
Guests will have the option to carry out requirements for their journey and their stay either in person, on the phone or via a kiosk. Whether that be requesting a room upgrade, cancellation, check-in or adding to their itinerary, hoteliers and guests will have the ability to determine the functionality of how they will evolve their own end-to-end capabilities. Any new systems and changes to operations will take time to bed in but we are seeing growing demand already for an even more consolidated approach to guest communications and autonomy over the administration of their journey that will continue apace.
An enhanced guest experience will be followed by a greater use of the hotel inventory to support the direct market and drive profitable sales. Alongside omnichannel consolidation, hoteliers are planning to be able to deliver more of the itinerary to a booking such as vouchers for a spa treatment, F&B or meeting rooms.
Securing a busier itinerary at the point of booking rather than at a later stage delivers a greater guest experience as well as revenue. I believe Attribute Based Selling comes after this and is not the easiest problem to solve given the current state of the ecosystem, despite the attention it has seemingly received.
Finally, aligned with the digital experience and in an effort to reduce OTA commissions and once again invest in direct, many hoteliers will take a more forensic approach to CRM systems and automation. Guest communications – otherwise known as newsletters and pre- and post-stay guest comms – is a well-established marketing stable for hoteliers. Moving into the months ahead and beyond we expect to see significant in-roads to making this a more sophisticated tool to develop more engaging, higher quality content and manage growing contact lists and databases with those all-important guest profiles.
To provide a bit more context, I made some predictions in 2022, which many of these trends have built on. In particular, the end-to-end guest journey which has unquestionably become more digitised with greater adoption by hoteliers and guests alike.
Both guests and staff are keen to adopt digitisation as not only can it deliver greater efficiency and reduce pressure on staff, it can also enhance the guest experience. No-one wants to queue to do something mundane, and digitisation is certainly a way to avoid that. How will this evolve further? Streamlining of vendors and integration will pave the way for even more effective implementation. Putting any new system into place often requires a change in operations and this can present challenges, especially when trying to balance multiple providers. For those hoteliers keen to take a more coherent approach to the end-to-end digitised guest journey, we expect they will demand more holistic suppliers to deliver this.
The rise in pre-payment has arguably been slower than I expected but I am hearing more situations where it is being implemented and adopted. The impact of automation on the end-to-end guest journey, coupled with some brands adjusting their pre-pay pricing models to incentivise guests and the solid foundations laid by those who have adopted it thus far, have paved the way for the payment landscape to change significantly and rapidly in the months ahead. Certainly for many operators it will provide vital support for cash-flow and revenue. I still believe that in time, pre-payment for bedroom reservations will simplify a lot for our industry and will become the expectation of all.
Striking the right balance between direct and OTA bookings has continued to be a focus, not least with the advance of Google Hotel Ads. It is fair to say the impact of Google Hotel Ads is still filtering through and the balance in the market will be one to watch.
Whilst those operators who have taken advantage so far have reported positive results, what is less clear is the impact it has had on the OTAs. The bigger players such as Booking.com and Expedia have all reported strong profits. Is this, however, more the result of rising inflation and pent-up demand which arguably might not sustain profit margins in the months ahead? This will present its own pressure for the OTAs as they look to diversify service offers – for example, into taxis in the case of Booking.com. For building those all-important direct guest relationships and safeguarding guest loyalty, direct bookings and profit, Google Hotel Ads will certainly offer a very real and present opportunity for hoteliers.
Unquestionably there are hurdles ahead but the evolving technology trends emerging will prove valuable allies when overcoming them.
