Using big data to gain insights about hotel guests is a relatively new development in the lodging industry. When done right, it can provide actionable intel to hoteliers that can boost room rates and drive more business to loyalty programs and marketing campaigns. And there are plenty of tech outfits stepping up to lend their expertise to hotels. “We have 18 companies now that we’ve invested in through Thayer Ventures, our venture capital arm, all in the hospitality travel technology space,” says Lee Pillsbury, co-chairman and chief executive officer of Thayer Lodging Group. “One is able to analyze the number of airline passengers overnighting in New York City in any date in the future.” If there’s a huge snowstorm coming to New York, Pillsbury says, the company will take into account the weather forecast and the 600 flights that will be canceled and determine the number of people who will now be staying overnight in Las Vegas as a result.
He points to another Thayer investment that combines the frequent travel programs for the airlines and hotels to get a more complete picture of how consumers are behaving. “These companies are generating new information that isn’t available any other way,” he says.
From booking data to loyalty preferences, weather reports to social network comments, there’s a lot of value to be found by sifting through the data surrounding your guests. “Collection of data is at an all-time high, and it’s likely to accelerate even more,” says Mike Bennett, a partner in the Chicago-based law firm Edwards Wildman. “We have more sources of data than we have ever had, and that’s not to say that we didn’t have the data before, but it’s easier to pull it together, and it’s easier to extract it from the sources than it ever was before.” Bennett advises companies on the legal issues inherent in existing and emerging technologies.
A good example of big data in action is Duetto Research, a Thayer-backed firm that specializes in revenue management systems. “By working with certain CRS providers and channel managers, Duetto has developed the ability to import things like the number of queries a hotel receives from third-party channels like the GDS or OTAs,” says Duetto CEO Patrick Bosworth. “So we can track customers as they search for hotels on a third-party platform.” Duetto’s software can even pull in TripAdvisor review data from partners like ReviewPro, Revinate, and newBrandAnalytics.
With big data, the trick is figuring out what kind of information is going to provide the most actionable intel. You can’t just sift through an enormous pile of data and hope you find the right thing. “We need transactional information to operate,” says Marco Benvenuti, Duetto’s chief analytics and product officer. “That’s the base of how our own data capture and algorithm works. We need to see every single reservation modification, cancellation, block, every single thing at the lowest level.”
The problem is that there are a lot of interested parties, from brands to OTAs to management companies, with their hands already in the transactional information pie.
Benvenuti brings up the example of an ownership group wanting to put all of its properties into a single Duetto Edge dashboard so it could monitor and set rates across the portfolio. Since half of the owner’s properties were with a brand that wouldn’t allow access to the raw data, the group couldn’t do it. “When a hotel owner wants to use our system to forecast his portfolio, he should be able to use it,” Bosworth says. “It shouldn’t be up to the brand to say, ‘No, you cannot have access to that data.’”
Pillsbury says questions like these haven’t been litigated yet, so there really isn’t a definitive answer of who can use what when it comes to guest data. “I think the brands feel very strongly that they own it,” Pillsbury says. “I can tell you as owners, we feel very strongly that we own it. But we don’t need to own it exclusively.” At this point, Pillsbury adds, the usage of booking and transaction data is being negotiated on a case-by-case basis in each new contract that’s signed.
Pillsbury does his best to makes sure the question of data ownership is ambiguous in his contracts, Bosworth says. “It’s left as a, ‘Let’s leave it so that the contract is unclear on this point.’”
That’s not a bad way to go. “There’s a strong motivation for the parties to play nice together,” Bennett says. “Because if a big fight breaks out over who owns the data, the answer is going to come down to, ‘None of you own this data. This is the data of the individual.’”