TechnologyTechnology, Innovation, and the Future of the Hotel Industry

Technology, Innovation, and the Future of the Hotel Industry

The future of the hospitality industry rests on technology. Using technology, hotels have the opportunity to realize continued growth and success. The adoption of new tools and solutions gives hoteliers the power to survive this current and future downturns by reducing costs and creating new profit centers. This is the direction hospitality is heading, and it is the defining trend of this era and the future.

At the close of the last cycle, as hoteliers were searching for ways to improve flattening rates among record occupancy, no one could have possibly foreseen the direction the industry was headed in as 2020 began. Trends that were prevalent then have been amplified today, and hoteliers who were early tech adopters are benefiting greatly from increased efficiencies, a strong digital strategy, and reduced operating costs.

Hoteliers just now considering these changes have not completely missed out on gains—this trend is likely to continue, and accelerate, in the near future.

Contactless Engagement to Bring Hotels Up to Speed

Travelers today have a greater level of engagement with all forms of technology than what hotels are currently able to tap into, and future generations will have tech even further ingrained into their daily lives. Meanwhile, more and more of the hotel experience will be delivered through digital offerings and remote interactions as technology improves over time.

Guests have spent years informing industry leaders of their desire for innovations in hospitality such as a consistent contactless experience—an offering that has already been cemented in other industries from air travel to food and beverage but is only provided by a small portion of hotels. In essence, there is still time to adapt.

Hoteliers who are nervous that new technology will shake up the meticulously crafted hotel guest experience can take refuge in the knowledge that the majority of guests are prepared to adapt to innovation. It’s not uncommon for consumers to order food from a kiosk or print airline boarding passes without waiting to speak with an agent.

However, despite growing interest in this technology across multiple hotel segments, the industry still has a lot of catching up to do if it wants to consistently provide a quality contactless stay. Despite years of evidence that guests are interested in contactless tech, only a fraction of hotels have committed to offering such an experience.

In most cases, there are two factors driving consumers’ desire for a contactless stay: Convenience and safety. Right now, safety is the highest priority for almost every traveler. These guests are interested in new ways to interact with hotel workers, purchase rooms or upgrades, and access additional information about a property or its local area. These are inquiries that must be addressed quickly and with the highest level of detail, and by embracing contactless operations hoteliers are prioritizing their guests’ needs while positioning their properties to endure the next time the market sours.

Efficiency for Operators

Hoteliers naturally think of the guest first, but it’s time for technology to also benefit the providers who are searching for ways to sustain healthy margins and retain high-quality employees. Replacing skilled workers in a thriving market is expensive, and right now the cost of talent is even more exorbitant. Retaining employees is invaluable at this stage, and hoteliers who fail to adopt new technology to ease their operational burden are being reckless with their talent pool.

Operators today are badly in need of new efficiencies if they hope to remain successful in the near future, to say nothing of retaining investor interest. While the industry has dutifully invested in the technology that is capable of meeting guests’ needs, many necessary improvements have to take place behind the scenes to insulate owners and operators from rising costs and tight margins.

The hotel landscape is full of operators weighed down by contrasting vendor agreements touting systems that remain incompatible with one another by design. This is not a sustainable way of introducing innovation to any business. It limits creativity, creates rigidity, and slows any attempts from leadership to nimbly make decisions and react to a market that remains constantly in flux. Operators across the industry are seeking out technology partners who are willing to work with the tech in which they have already invested and dropping inflexible systems that reduce agility when it is needed most.

Hospitality is also facing an economic wake-up call right now that cannot be ignored. The government aid that has been provided to so many organizations within the travel ecosystem is being discontinued. Occupancy is down across the board. As businesses close around the country, either temporarily or permanently, hotels are also losing out on crucial regional or national partnerships used to provide amenities or services guests have come to expect.

The need for hotels to become self-sufficient has never been more pressing.

Digital Freedom

Fortunately, hoteliers have an excellent tech base to build off of when researching ways to increase their agility going forward. Integrations are gradually taking place across dissimilar systems or departments that traditionally never shared information. This allows operators to invest in technology that works with them, as opposed to what is best for tech providers.

Housekeeping and maintenance are finally being aggregated into hotel property management systems. There are newer and better ways to interact with guests than ever before, such as through branded apps, SMS push notifications, and targeted email strategies. Additionally, revenue management tools have begun to take command of the industry in a way never before thought possible, helping even small properties outlast negative market conditions for months.

The challenge hoteliers will face going forward is deciding on what technology they should invest in to best improve their property’s performance. Guest desires continue to change over time, and operators will not be able to out-strategize these trends—their only option is to appease the guest. This is also an ideal time to introduce new changes to a property’s operations or tech strategy while guests are closely engaged with the digital side of travel.

The tools available to hotels right now have the potential to simplify operations, enhance the guest experience, create efficiencies, and reduce both labor costs and worker burnout. Hospitality has a reputation that puts people first at all times, but technology exists to ease the burdens faced by business leaders during eras such as the one the industry is currently soldiering through.

Brands, as well as operators, need to focus on creating cost efficiencies without compromising the guest experience. Any technology that allows them to achieve this goal, while providing a future path for the organization’s growth, should be prioritized. The industry is already well aware of guests’ desires—it’s time to meet them while we can.


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Raj Trivedi
Raj Trivedi
Rajiv (Raj) Trivedi served as president of La Quinta until 2019. He is currently managing partner of TST Capital and chairman of Virdee, a SaaS company serving the lodging and commercial real estate industries.