The hospitality industry is facing its biggest change in a generation: becoming brave enough to rely on new technologies to know the guest better, improve communication, automate where possible, and optimise pricing to drive revenues and bottom line.
Those that take the leap of faith will win guest loyalty, market share and profit. Early innovators will lead the pack. The rest will play catch up. That was the resounding message to come from the third Revenue Strategy Forum in London, which took place at the Amba Hotel Charing Cross on 6 November.
Hospitality innovators and brand executives came together to discuss new innovations in artificial intelligence, cognitive learning and big data analytics.
Bret Greenstein, VP of Consumer Business at IBM Watson Internet of Things, kicked off proceedings with a keynote speech on cognitive and predictive intelligence.
He detailed the many innovations coming through IoT and how a connected world can deliver more guest data, leading to greater personalisation and improved guest comfort.
“We’re at the age of the intersection between man and the machine, the physical world and Internet world coming together. Everything is going to be connected,” said Greenstein.
He said hotels need to be asking how data from IoT can change what they learn about their customers and services. “Question how you can engage with the guest better all the time and deliver higher values of service,” he suggested.
According to Greenstein, there will be 30 billion devices connected to the Internet by 2020.
“All those connected [devices are] generating data, moments and points to engage with your customer,” he pointed out. “It’s telling you how rooms function, what people are doing, and what they need. When things happen that affect the guest you know about it as fast as they do, if not before,” he said.
With this new and improved guest data, hotels can improve experiences as well as avert guest discomfort and guest complaints. For example, knowing that the air conditioning in a room is about to fail, and being able to fix it ahead of guest check-in is preferable to a guest having to experience a hot and stuffy room, dial down to customer services and then wait for an engineer.
Greenstein also tackled the issue of voice-activated technology, highlighting how today’s generation doesn’t like picking up the phone to ask for something.
“They would rather find the easiest way to get the answers. People just want to be helped. They get frustrated when they hear ‘Sorry, I don’t know that’,” Greenstein said.
He added the guest wants a technology that provides information on things to do, how to get somewhere, where to eat, and to do it in a way where you don’t have to learn the commands but just say what you want. For example, “I’m feeling thirsty”, “I need another pillow” or “play something nice” and the technology already knows their favourite Spotify playlist.
“It’s just like the room understood. The guest walks away just feeling good rather than frustrated,” Greenstein said.
Rethinking Hotel Technology
In a panel discussion on Rethinking Hotel Technology moderated by Lee Hayhurst, Head of News at Travel Weekly, hoteliers and technology consultants came together to discuss the main issues they face in terms of improving their tech stack. Many agreed that, if they could start over from scratch, their tech stack would look very different to how it does today.
Cloud-based technology was identified as one of the big change factors in the future of hotel tech.
“We’re at a change point with the opportunity that comes with cloud systems and software as a service,” said Marc Fries, VP of Change Management at AHM Hotel Management. “You can buy [solutions] once and go chainwide so much easier.”
“We're at a position now where we can change the way we look at investment in technology,” added Richard Pemberton, Hospitality Technology Consultant at Avenue9 Solutions. “In the past it was part of a cap ex model, but with cloud-based tech it is very much on an op ex basis, so it’s more cost effective.”
Nick Price, CIO at CitizenM, took the argument for cloud-based technology a step further: “If you buy as SaaS then they cannot be legacy as they are being updated. That immediately changes the game.”
The panel also discussed further ways in which the hotel industry can emulate the technological choices offered to travellers by the airline industry. Thomas Cook will launch a choose-your-room option from next summer, and panellists discussed if this is something that could and should become generally available to all hotels.
"I can book my seat on an airplane so why can’t I book a hotel room. Its not rocket science. If we can adopt some of those practices it would be really great,” said Pemberton of Avenue9.
Extreme Customer Centricity
Closing the one-day Revenue Strategy Forum was Rik Vera, co-founder of Nexxworks, who delivered a stimulating and thought-provoking presentation on the change in customer behaviour in a digital world.
Outlining the breakneck speed of recent technological innovations, Vera talked of “software eating the world.”
“There is a gap between what we do and what the customer wants. We have underestimated the speed of change. It is hitting us far sooner that we ever expected,” he told the audience.
“The world has changed but hotels haven’t changed that much – that is dangerous. In between the gap is disruption. For companies that are linear, that is the threat,” he said.
Many in the hotel industry have identified online travel agents and the sharing community, such as Airbnb, as disruptors. Yet, according to Vera, the guest is the biggest disruptor of all.
“Your biggest disruptor is the customer. We are changing because of digitisation. It’s not digital, it’s not technology, it’s our own behaviour which is changing business,” he pointed out.
In a hyper-connected world, hotels need to put the guest at the centre of the universe, because that is where they feel they belong.
“Your strategy needs to be customer centric. Your customer base is volatile, uncertain, complex and ambiguous. They are self centred,” Vera said, going on to explain how data is the new gold. “Use data to engage customers, know me, don’t upsell, cross-sell or deep sell. We want to be recognised. Make sure every department is aware of my story and picks up the story. Make it matter. Do it at my size.”
To close, Vera talked about creating many touch points via social media. “Think about your hotel and use as many touch points as you can,” he said. “Make sure that your touch points not only talk but also listen. Tell stories and inspire. Then use your customers as your sales and marketing people,” he said.
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