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Study: Hoteliers Not Taking Tech Into the Future

Study: Hoteliers Not Taking Tech Into the Future

While hoteliers anticipate highly-sophisticated and ‘digital native’ hotel guests in 2020, their plans for industry technology remain stuck in the early 2000s. This is the research finding from ‘The Hotel Industry in 2020’ carried out by Peter O’Connor, IDeaS Revenue Solutions, Revinate, and SiteMinder. The study compiled survey results from hundreds of leading hoteliers around the world, and the results of a ‘visioning’ session with experienced hoteliers and consultants held during World Travel Market (WTM) London in November 2016.

“The combined research explored anticipated hotel guests of 2020, as well as the technology needed to cater to their needs,” says Peter O’Connor, professor at ESSEC Business School. “We wanted to hear directly from hoteliers about how the future traveller would look, and the measures needed to prepare for them.”

According to O’Connor, participants anticipate highly-sophisticated guests that seek unique experiences, have higher expectations and also expect recognition. As ‘digital natives,’ these guests will rely primarily on mobile devices to engage with hotels before, during and after their hotel stay. Key differentiators such as flexibility, value and control are predicted to play a larger role in the guests’ buying decisions than human interaction.

Fabian Specht, managing director EMEA at IDeaS, says, “The collected data reveals predictions of a more demanding customer, with greater choices and access to information.”

When asked which technology hotels could not be without in 2020, respondents named those already implemented in many hotels, including revenue management systems, customer relationship management systems, property management systems, channel managers, and e-marketing solutions.

Thomas Landen, EMEA marketing manager at Revinate, adds, “These results reflect the high degree of conservatism within the hotel industry, particularly when it comes to technology. It is as if the industry is still preoccupied with the same issues as ten years ago.”

By contrast, expert panelists—largely operational managers and consultants from UK and European hotel properties and technology arenas—nominated middleware, artificial intelligence (AI) and machine learning systems, predictive analysis tools, and management dashboards to have more integrated views of the guest, along with messaging solutions and Bluetooth beacons to drive deeper engagement.

The panelists suggested a key roadblock to implementing these systems industry-wide was highly-siloed customer data, which prevents a single 360-degree guest view. Other roadblocks included data protection and privacy issues, as many countries limit guest information storage; and industry conservatism with few hotels pushing boundaries and most tending to stick with well-established systems in the marketplace.

Dai Williams, managing director EMEA at SiteMinder, says, “It is clear we operate in an industry that continues to look to outdated and often-costly legacy systems for technological support. The resistance among hotels to change and innovation hurts the advancement of our industry, which, in itself, recognises the need to keep up with current and future consumers.”

To break the cycle, panelists advocate for the rise of a new breed of hotel management, one that includes applying a different set of skills and mindset capable of pushing technology forward—a process already successful within industries such as retail and banking.

One comment

  1. The disruptive innovations will not come from within the industry itself, that has rarely been the culture of the profession. The innovations that come from the industry are incremental: key cards, softer mattresses, faster check-in, revenue management. The disruption will come from external forces and innovators seizing an opportunity or unmet need, e.g. airbnb. The reasons are many but among them are the need for operators for focus on the financial performance in the next quarter and operate the hotel today. This gives little bandwidth for innovation on the scale discussed in the article. The second reason is a lack of understanding of emerging tech and the implications to disrupting current hotel processes and organizational structures. Take robotics as an example, thinking of a robot solely in terms of replacing a concierge is a very poor understanding of the technology. The basic R&D for hospitality tech will happen in Engineering Schools, Architecture, Data Science and Innovation Labs like UNLV’s. These young entrepreneurially minded millennials see the world through a different lense and will change the industry.

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