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Article by Terri Miller

How to Deliver Personalized Guest Experiences in the Age of GDPR and Data Privacy Concerns

Concilio Labs, Inc. 18 May 2018
Hotels are faced with an interesting dilemma. We're entering a time of hyper-personalization -- guests show dominating preference for hospitality experiences which are more unique in nature and catered to individual needs/expectations. However, riding the coattails of the on-going personalization trend comes the initial implementation of GDPR on May 25th.For those unfamiliar, the General Data Protection Regulation (GDPR) aims strengthen and unify data protection for individuals within the European Union (EU). This legislation, which applies to guests and employees, brings with it a large number of changes relating to the use of personal data.This is where the dueling conundrum lies. With all these rules and guidelines, how will hotels remain competitive in their quest to deliver the exceptional, personalized service guests expect? How can hotels be expected to get personal if they have limited access to personal data?We're here to break it down for you.What Constitutes 'Personal Data'?In order to understand the expectations (and subsequent limitations) of the new protocol, we need to first gain an understanding of what exactly GDPR defines as the "personal data" of guests and hotel employees.In the case of GDPR, personal data is "any information relating to an identified or identifiable natural person ('data subject')". Basically, this could include an individual's name, identification number, location data, online identifiers, their physical appearance, and more. Consider this the beginning tier of data classification, while other personal information such as political beliefs, biometric data, genetic information, is considered sensitive and is therefore held to a higher standard of security.Why GDPR?You may be wondering why this new legislation has come to fruition. Over time it has been noted that the hospitality industry is exceptionally vulnerable to data-related threats. From pre-stay to post-stay, guests are engaged in a near limitless number of transactions, which involve the exchange of sensitive information in addition to credit card data. In fact, according to the Verizon 2016 Data Breach Investigations, the hotel industry accounted for the second largest share of security breaches in 2016.GDPR has been formulated in an effort to remedy this trend in the EU, compelling hotels to upgrade their data protection processes to meet new, improved standards. Those hotels who do not meet the standards enforced by GDPR will face serious financial penalties, with costs up to EUR20 million or 4 per cent of worldwide annual turnover (whichever is greater).How Can Hotels Collect Personal Data for GDPR?While it may seem daunting at first glance, the GDPR legislation shouldn't act as an impenetrable barrier between hoteliers and their guests.With GDPR in place, personal data must be collected for specified explicit purposes. Further, data cannot be captured (with consent for a specific information exchange) and then used for other purposes, unless consent is readily provided and documented. Let's consider a common example. Imagine a guest has supplied their email address at the time of booking a hotel. Under GDPR's regulations, you cannot use that email for email marketing at a later stage, unless the guest provided documented consent (likely through an 'opt-in' feature) for that use.Due to the dynamic nature of hotel services and touch points, it's likely that guests' personal details are shared amongst different areas of a hotel's operation (the front desk, spa, restaurants etc.). In preparation of GDPR, hotels' management teams should set aside time to complete a data mapping process that clarifies what data is captured, where that information is stored and how it can be used -- in order to protect and monitor it appropriately.Hoteliers should also take a closer look at their third-party partnerships, to ensure there is no risk to the security of guest data within those touchpoints, as well. Why is this so important? Under the standards of GDPR, if a hotel is outsourcing the process of data to a third party who is not complying with GDPR regulations, the hotel and the third-party processor can be held jointly responsible if a breach occurs.GDPR might leave some hoteliers feeling nervous as they prepare for changes to their current data processes, especially considering how many hotels rely on email marketing as a critical pillar to their business model. However, it's important to recognize the opportunity this legislation provides to establish more open communication streams with guests. In order to access and use their personal data, hotels must now develop a communications strategy that allows guests to know exactly what their data is being used for, and why. Essentially, hoteliers will be expected to talk with their guests, in a more holistic and transparent manner, to determine what they want out of their experience.In many ways, GDPR may ultimately yield a positive outcome for hoteliers and for guests. By forcing an opt-in and being specific about how information will be used, hoteliers will be left with a database of clients that are interested in receiving relevant guest experiences, marketing messages, and perhaps more receptive to booking or becoming loyal to your hotel.Additionally, it forces hoteliers to become smarter about what data they request and keep. The data which hoteliers must access to satiate and earn the loyalty of modern guests speaks to their preferences. What wine do they like, what type of pillow do they prefer, what other items, service styles or experiences will make their stay more enjoyable? The use of this type of data should be easy to obtain guest consent for, as it will ensure their visit meets (and exceeds) their expectations.
Article by Ford Blakely

How Hotels Can Automate Guest Requests with Text Messaging

Zingle 17 May 2018
It feels good when someone tells you they like you. But when you're a hotel, someone telling you they like you can impact your bottom line. According to TripAdvisor, 83% of travelers rely on ratings when choosing a hotel, and a study by Harvard Business School found that a 1-star increase in ratings equals a 5-9% increase in revenue. Given that reviews play such an important role in the life of your hotel, it's only natural that you should be thinking about ways to provide the best possible guest experience to ensure that they leave positive reviews.Sounds simple enough, right? Well, expectations are high and good reviews don't necessarily come easy. Guests expect high quality service from hotels, which often equates to quick processes and convenient ways to get what they need.Case in point: 68% of guests want to speed up the check-in process by using their smartphones. If the only way for guests to reach customer service is through the in-room phone or by physically visiting customer service at the front desk, then hotels are actually just serving guests the way they want to - not the way guests want to be served.Luckily, technology can provide hotels with a solution. By integrating tools to implement streamlined processes, hotels can better serve guests throughout their entire stay regardless of whether they are in their room, or even in the hotel at all.After all, hotels are not the end destination for guests. They're there to enjoy some of the amenities like the pool or restaurants, or they're out sightseeing and visiting attractions. Providing customer service to guests no matter where they are is a key factor in improving guest satisfaction - and one easy way to do that? Through text messaging.Text messaging is one of the most convenient and low effort communication methods, especially given that essentially every phone (regardless of how "smart" it is) can accommodate it. For guests, text enables guests to engage with the hotel anywhere they are - on a tour, lounging on the beach, in-between business meetings, you name it.For staff, enabling customer service via text messaging and automation frees them from a desk phone, speeds up processes, and allows them to serve guests quickly and successfully throughout their entire trip.Here are some of the ways that hotel service teams can automate guest requests through texting to provide a more enjoyable stay:During check-in: Everyone loves skipping a long line. Let your guests check-in via text and help them get settled into their room faster so they can get started on their vacation. By integrating texting with your check-in system, hotels can automatically send alerts to guests when their room is ready. Some hotels even offer a mobile room key so guests can enter their room via a smartphone.Room service/housekeeping: Maximize guest comfort by letting them text you to arrange for fresh towels or order room service. This process can be easily streamined by integrating a texting software with the hotel's ticketing system. For example, as soon as a guest sends a text request for those fries, the message can automatically get sent to the kitchen without the need for manual routing.Concierge services: Help your guests navigate the city they're visiting, provide recommendations on the spot, arrange a pick-up from wherever they are, and offer suggestions while t making decisions in-real time. If you know your guests' interests, this is the perfect time to serve up some recommendations to guests via text message and get them booked for a tour or activity. Dining reservations: As soon as a guest knows they want to go out for a meal, allow them to text you so you can arrange reservations for them. Using a time-based automation, hotels can send coupons via text for onsite restaurants and bars to entice guests to stay and enjoy a meal or a few drinks, thus helping drive incremental revenue.Valet car pick-up: No more waiting outside while the valet brings the car around. Guests can feel like a VIP by walking right out the door and into their car by texting the valet before heading down to the lobby. Once a guest texts the valet for car pickup, the request can automatically get routed to the valet team for faster service.Feedback surveys: We live busy and often chaotic lives and the last thing we want to do is take the extra time to provide feedback. This is why traditional feedback survey response rates hover around 2%. With text's 98% vs email's 20% open rate, text messaging provides an easier and more effective way to unlock insight into how to improve your guest experience. Some business text messaging providers offer a direct integration with TripAdvisor so guests get prompted to leave a review after providing positive feedback. If the feedback is negative, hotel staff gets immediately alerted so they can resolve the issue before it makes it onto a public review site.There are many different ways that hotel customer service can use text messaging to automate and streamline the most common requests while also providing a more personalized experience. With teams freed up from the manual processing and managing requests, they'll be able to focus on delivering great service and building strong and lasting relationships with guests.For a passport to quicker and more personalized customer service, hotels need to look no further than the devices we already have in our hands. Not only will automated customer service enable you to provide a stellar stay during their trips, but it could also help make your hotel the destination.
Article by Dean Minett

3 Misguided Trends in the Hotel Industry Today

Minett Consulting 17 May 2018
The world of hotels is a lot like the world of fashion. Every year, new trends and styles come sashaying down the catwalk. Some are eye-catching, some are puzzling, and some are downright ridiculous - depending on who you ask.This constant drive to innovate is one of the things that makes our profession so dynamic. Hoteliers and their stakeholders are always looking for the next original combination of styles and concepts. Sometimes it even pays off. Multi-functional common spaces are a good example. A decade ago, this concept was akin to one of those outlandish puffy gowns with a matching headpiece. In 2018, breezy common areas with ergonomic workstations are less the exception and more the rule.But let's face it - for every good idea that sticks around, there are a dozen that can't be swept into the dustbin quickly enough. Here are a few recent hotel trends that should probably enjoy the catwalk while they can.Wacky butlersAt the Ojai Valley Inn & Spa in Southern California, a sunglasses butler will tighten and clean your shades while you lounge by the pool. At the Benjamin in New York City, restless guests have access to a sleep concierge who gives advice on getting good sleep, and helps guests select from a pillow menu. Your dog doesn't have to go wanting, either. If you're at the Belmond Hotel Splendido in Portofino, Italy, a dedicated dog masseuse will de-stress Fido with Swedish massage in a room overlooking the Portofino Bay.Some of these butler services are both fun and practical. At the Park Hyatt in Tokyo, for example, a VIP "entertainment concierge" will help you navigate the city, bridge the language gap, and give you access to local hotspots. This is a logical step in the age of experiences over things - but some of the butlers now roaming the world's hotels make it appear as though logic and reason have left the building.Space age technologyWhen a guest wants to lower the shades or change the lighting, that fancy control panel had better be easy to navigate. Otherwise it will lead them into a confusing and frustrating experience, in which changing the air temperature becomes an exercise in advanced programming.The answer, by the way, is not to introduce a control panel butler who helps guests understand in-room controls. Instead, let's make sure to keep those controls elegant and simple. There's no doubt that technological advances can enhance the guest experience, but the wrong kind of technology can make things worse. Products are coming to the market fast and furious these days. Hoteliers should be wary of investing in control panels that are flashy and expensive but frustrating to use. (Interestingly, I was recently asked for some input on an in-room tablet solution and when I pointed out some challenges that guests might have, the spruiker wanted me to use more technology to deal with it. This clearly misses the (obvious) point that if technology is not user-friendly, it will not be used.)Astronomical thread countsSpeaking of things that merely look or sound impressive, let's talk about thread counts. Is a higher thread count always better? Luxury linens typically clock in between 300 - 500 threads, but some hotels have recently been advertising bed sheets with thread counts in excess of one thousand. The problem is, most people can't tell the difference. If they can, they might conclude that a lower thread count is more luxurious.Single-ply Egyptian cotton around 400TC is widely considered to be the most luxurious - especially when they've been newly washed and ironed. Sheets with higher thread counts tend to be made of cheaper two-ply yarns, which give them a heavier feel. It may be difficult to compare and contrast sheets when you check into a hotel, but the highest thread count you've ever experienced is probably not the most luxurious.Keeping it realWe hoteliers face a broad set of challenges. Navigating the landscape of hotel trends is one of them. As we survey our properties, we should strive to know the difference between a passing fad and a timeless touch. As the designer Karl Lagerfield put it, "trendy is the last stage before tacky." There will always be new and interesting things coming down the hotel catwalk, but let's face it - not all of them look good in the real world!
Article by Jeff Zabin

What Hotel Technology Decision Makers Need to Know About Cloud Solutions

Starfleet Research 16 May 2018
"Built for the Cloud: A Blueprint for Hotel Technology Success" is now available for complimentary access. Click here to access. The following is a brief excerpt.For well over a decade, hospitality industry pundits predicted widespread cloud adoption by hotels and resorts. Only in recent years, however, have cloud-based models begun to disrupt the established lay of the land, migrating on a large scale basis from peripheral point solutions to the core property management system.Importantly, cloud-based solutions are not, in fact, always based in the cloud. Some of the dominant PMS legacy solutions that are currently in place across Europe, North America and Asia have been merely upgraded with a web front-end interface. The interface provides access via an internet browser on a computer, tablet or mobile device to the back-end software, which remains hosted on a local, on premise server.This type of cloud-based hospitality software, in which certain critical elements continue to reside on-premise -- including, in many cases, the actual database housing the guest data -- are known as hybrid cloud solutions. A web-native "true cloud" solution, on the other hand, is hosted on shared application servers in a public cloud environment and has the advantage of being more agile, flexible and open to multi-tenancy. Another advantage relates to software release updates. With a true cloud solution, these upgrades are more seamlessly and frequently deployed and also included as part of the cost.With respect to system upgrades, the shift from on-premise installation to cloud-based deployment have caused hoteliers to pay close attention to service level agreements and up-time guarantees. This is no surprise given that the PMS handles virtually all operations, including guest-facing service functions. Hotels that experience technology performance issues generally pay a dear price.In the past, these issues have tended to arise most often during, or immediately following, system upgrades of on-premise, client-server software. Regardless of how much time and effort may have gone into quality assurance testing, new releases of hospitality applications with monolithic feature-laden code were bound to have performance issues. The problem was oftentimes related to the difficulty of simulating a hotel's customized software configuration, including the specific data streams that flowed into the PMS.To help reduce potential performance issues related to system upgrades, solution providers would commonly implement user acceptance testing processes. This meant creating a copy of the production database and installing an advance copy of the new software release on the hotel's servers. Hotel staff would rigorously test the new system, trying to identify defects and reporting any bugs or performance shortcomings.A benefit to this approach, in addition to reducing the risk of calamity, was that hotel staff could familiarize themselves with new interface as well as features and functionality prior to going live. Software fixes would be either installed as patches or incorporated into a new release, which, typically, would then be reinstalled and retested. The trial run process continued until all issues were resolved and the software was deemed to be relatively free of defects.The software upgrade process for a true cloud PMS is very different. In sharp contrast to the process involving legacy systems and even, to a lesser degree, hybrid cloud solutions, this process tends to be largely hassle- and worry-free for hoteliers, who, in past, were often held partially responsible for any performance hiccups. With single-version development, all hotel customers are upgraded simultaneously, putting the onus on the solution provider to ensure that the software is delivered with unfaltering quality and performs in an error-free manner.Multi-tenancy, storage arrays and the same data center hardware generally means that all hotel customers are in the same boat when it comes to technical performance issues. If a problem arises, the same problem will usually have already affected other hotel operations. The problem will likely have already reported it and the solution provider will already be working to resolve it. Single-version development and deployment benefits everyone."Built for the Cloud: A Blueprint for Hotel Technology Success" is now available for complimentary access. Click here to access.
Article by Martin Soler

Food for thought: Deloitte's look at travel future, Google search is changing

Soler & Associates 15 May 2018
In addition to the two projects* I mentioned in last post there's one that I am particularly looking forward to, The Hotel Yearbook 2019, I'm honored to be the guest editor for this edition and we have been working with a bunch of exciting contributors such as KasselsKramer, citizenM, Ctrip, Paolo Torchio from Two-Roads Hospitality, Philippe Vaurs from Elegancia Hotels and many more. Digital marketing has changed from the pure performance and clicks that we used to associate with it. We'll cover topics like how brand building and brand integrity is now managed online. Excited to show it to everyone. *The two projects I mentioned are Tell. Trends a paid quarterly report of the trends in hotel marketing and you can get on the waiting list. And the Marketing Workshop for Hotel Technology Companies happening later this year.Food for thought.Google Maps becoming the ultimate travel appIt is arguable that Google Maps is the most used travel app. The reviews are growing at an incredible pace, the contributor community is actually a community with exclusive events at Google Offices and that's just a small part of it. With recommendations this is growing even more and removing the travelers "where should we eat tonight" struggle. For hotels and trips this eventually means more (paid) opportunities to get discovered at the right moments.ANALYSING GOOGLE TRAVEL APPSThe change in hotel searchHotel marketing has changed a lot over the last few years, the really short version is that today marketing a hotel is more about building a brand (through the experience) and great revenue management. The search for hotels is mostly about matching price, experience and location than it ever has been. As search platforms grow it more accessible building fewer generic hotels and more personalised experiences. There will always be tension between direct and third parties because third parties will try to lower costs to consumers and increase fees to partners, but they don't matter if one can charge the right price to the right guest.GOOGLE SEARCH AND HOTELSDeloitte looks at the future of tech in travel"Over the past two years, travel start-ups raised a cumulative $30 billion in funding - almost totalling the amount raised over the past 10 years." Deloitte's recent look into the future of travel tech is quite interesting and includes a very easy to understand overview of the 5 main sectors of travel technology that will shape the future: Artificial intelligence, Internet of Things, Voice, Automation and Blockchain.WHAT TECH WILL SHAPE TRAVELPreparing for Voice tech in HotelsThat voice technology is coming to hotels is not new. We know it is coming, the problem with such new technologies is what should hoteliers do, today, to prepare for it when it comes. It isn't viable to invest into such technologies heavily today since we don't know where it will go. But if anything, online distribution has taught us that waiting it out is a bad idea. Because nobody knows exactly when and how it will change, the only thing to do now is get prepared. This article has some pragmatic steps to do to prepare for the coming changes.GETTING READY FOR VOICEMarketing Lessons from the Movie IndustryThe movie industry has built one of the most efficient marketing machines we know. The risks are huge, the costs are extraordinarily high and the product has a limited lifecycle. Many similar (but smaller) conditions exist in the hotel industry, so learning from some of their marketing ideas can only help. Even if they have the star power, budgets, storytelling and graphic teams that beat any hotel or hotel group, there is still something to learn.SPENDING MILLIONS
Article by Genya van Belzen

How to use hotel automation while retaining unique and personal?

RoomRaccoon 14 May 2018
Automation in the hotel industry is becoming more common every day: check-in via smartphones, robots that communicate with your guests via Facebook, an app to pre-order your diner... It's where we're heading and not everybody is thrilled to incorporate automation in their business. Many hoteliers are a little scared of automatization as the focus shifts from guests to technology - from unique to standard. But... is this really true?No. Not if you do it correctly. RoomRaccoon's hotel automation software lets you keep that personal touch, superior service and unique identity. See for yourself and click below to have a free and personalised demo.Retain that personal touchIt's a fact that check-in apps and chatbots are less personal than a friendly-face behind the reception desk that answers all your questions, but you can still retain that personal touch while automating processes.Actually, by use of hotel software, it might be easier to be personal because hotel automation software lets you keep track of your guest preferences: was mister Sparrow allergic to nuts? You know it. Did you offer a special price because you felt sad? You remember it. You want to tell him this via e-mail? You send him an automatized e-mail upon arrival.Superior services staySuperior services are still available when you automate. As a matter of fact, it's even more easy to do so. Superior services include a warm welcome at the reception-desk, fast check-in and check-out and, of course, personalization. We've already established that personalisation is effortless by use of automation. So, let's move on!A warm welcome should be done by your host who is genuine and intuitive. And what makes a warmer welcome than a host who has tons of time on his hands because of automation? He's able to tell you a story about his property and give information about the neighbourhood. Of course, checking-in goes faster by automation as well because you have all the information you need. And you're able to see if it's possible to offer him a late-check-out or another room. Also, giving special discounts is not a problem anymore: were you a little late with breakfast? Offer him a 10% discount to make it up.Be unique and specialOffering special packages to your guests is a way to differentiate yourself from other hotels, B&B's and accommodation-providers. Those unique packages can be placed on your booking engine-page to drive more bookings.Special packages let you be unique but, besides this, your presence should be unique as well. You can do this by designing your own booking-engine page: customize it with pictures and colours as you seem fit.We don't have to be afraid of hotel automation, we should merely focus on its benefits (more time, more guest experience and more revenue). So, don't be afraid of automation: let it work for you!
Article by Max Starkov

The OTA's Attempt at Discrediting the Value of the Hotel's Direct Channel

HEBS Digital 11 May 2018
Earlier this week, the European Technology and Travel Services Association (ETTSA) released a report called "Hotel Distribution Costs," examining the costs associated with direct and indirect distribution channels for hotels, together with the impact of channel shift.ETTSA is an organization "representing and promoting the interests of global distribution systems (GDSs) and travel distributors (read: OTAs), towards the industry, policy-makers, opinion formers, consumer groups and all other relevant European stakeholders."The report, prepared by a consultancy called Infrata, concluded that hotels that attempt to boost direct bookings at the expense of agencies and OTAs risk having lower occupancy rates with "no measurable" savings on costs, and suggested the main reason for hoteliers to push direct sales is to "reduce transparency for consumers."The ETTSA report uses "a magic wand" to convince the naive or whoever is listening that hoteliers would be much better if they abandon their useless direct distribution efforts and rely on the OTAs for their distribution. The report's highly selective "analysis":Dramatically overstates the effect of the much discredited "OTA Billboard Effect"-- remember the unfortunate Cornell University "study," financed by the OTAs? This study, disproved many times over, tried to convince hoteliers that they should use OTAs in order to generate more bookings from the property's own website, due to the so-called "Billboard Effect."Underestimates the complexity of the online travel consumer journey: Today's travel consumer engages in 38,983 digital micro-moments in just under two months, and the average travel consumer journey takes about 17 days, eight research sessions, 18 site visits, and six clicks before making a hotel booking (Google Research).Tends to over-estimate the hotel's direct distribution costs and undervalue OTA distribution costs, which go beyond the OTA commissions, and include costs associated with revenue management, APIs, GDS, CRS and channel management systems, etc. OTA channel management alone occupies an increasing share of the revenue manager's bandwidth, which means rising payroll and benefit expenses. Does not account for the fact that direct booking costs are fixed, while OTA distribution costs are percentage of room revenue and grow with higher ADRs or longer length of stay (LOS).Makes the rather offensive claim that hoteliers' direct booking campaigns are motivated by the hotelier's desire to "decrease customer transparency."How much does a direct booking cost?Direct distribution costs vary by type of property (branded vs. independent), hotel category (luxury vs. budget), complexity of hotel product (spa resort vs. limited service), even across geographies (well established online travel marketplace like North America vs. emerging market), and so on.Here at HEBS Digital, the average direct distribution cost is 4.5% across our client portfolio, consisting of thousands of 4- and 5-star independent and "soft branded" hotels, resorts and casinos, small and mid-size luxury and boutique hotel brands. This direct cost includes all of the direct channel expenses, comprising of direct channel strategy, virtual team account manager and website revenue optimization consulting; mobile-first website design and development, amortized over 36 months; smartCMS website technology platform; ongoing cloud hosting and CDN, Adobe Analytics and reporting; professional SEO (technical SEO and on-page) with BrightEdge; SEM/paid search on Google and Bing; online media and GDN retargeting; smart data marketing, social media marketing, email marketing, and more.Compare this to the 15%-25% OTA distribution cost.Direct bookings are more than distribution cost savings, they are about targeting new "best" guests, about generating incremental revenues, about lasting customer engagement and retention.Hilton's CEO Christopher Nassetta said recently in a Skift interview: "We've been working very hard on strategies to have more direct relationships with customers. Direct bookings and loyalty are inextricably intertwined with one another, and they have a direct impact on Hilton's ability to offer a superior guest experience."Why do direct bookings matter?Distribution costs are rising:Distribution Costs: have been rising steadily over the last seven years due to OTAs increasing market share versus hotel direct bookings. A study by Kalibri Labs "Demystifying the Digital Marketplace" provided concrete evidence that this dramatic shift exceeded 40%.Except for distribution costs, hoteliers have limited control over the other main cost drivers in hotel operations:Labor Costs: creeping up due to unionized labor contract and mandated minimum wage/living wage increases in many municipalitiesDebt Service: at best, interest rates on commercial loans are staying flatFranchise Fees (Rewards, Marketing, Royalty, Reservation, etc.) are creeping up, as usualUtilities: normally 5% of gross. Water, Sewage, Gas & Electric are all creeping up; Water & Sewage are growing pretty fast latelyReal Estate Taxes: always creeping up at the whim of local municipalitiesRevenue capture is declining:In spite of a record-breaking performance in Q1, 2018 and the very optimistic forecasts for the rest of the year (STR), hospitality industry profitability is declining. U.S. hotels earned roughly $155.2 billion in guest-paid revenue in 2017, but paid an estimated $25.2 billion to acquire guests in the form of OTA commissions and other distribution costs, retaining significantly lower net room revenue of $130 billion (Kalibri Labs).Revenue capture--i.e., net room revenue that remained with the hotels after accounting for distribution costs (OTA commissions, traditional agency commissions, and other distribution expenses)--declined from 84.9% in 2015 to an estimated 83.5% in 2018 (Kalibri Labs).Guest engagement and retention is in jeopardy:Have you looked recently into what type of guest data the OTAs provide hotels, especially independent hotels? First Name, Last Name, OTA-credit card and OTA-email for communications. This is it!The OTA guest comes, stays, and leaves, and the hotel is left holding a bag of meaningless guest data. There is no CRM possible with this data, no in-stay upselling emails and messaging, no post-stay "Thank you" emails, no OTA guest satisfaction surveys, and no marketing automation or drip campaigns.Very few hotels train their front desk to even try getting additional information from the OTA guests and completing the guest profile data in the PMS.At the minimum, hoteliers, especially independents, should create internal processes and systems to: a) complete the OTA guest profiles in the PMS, b) create a "Next Time Book Direct" program and promote it to the OTA guests, and c) adopt full CRM capabilities at the property, including a Guest Appreciation Program/Reward Program, and include all OTA guests in it.Conclusion:Contrary to the findings of the pseudo-scientific ETTSA report, direct bookings (4.5% or lower distribution cost) are cheaper than OTA bookings that carry commissions of 15-25%, plus other fees.More importantly, direct bookings provide more than just distribution cost savings--they are about acquiring new "best" guests, generating incremental revenues, and creating lasting customer engagement and retention.
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How Hotels Can Deliver What Business Travelers Expect

Pegasus 9 May 2018
By catering to today's business traveler with the right offerings, hotels can generate a stable revenue stream. Reports indicate that the number of business trips each year has increased by 38% since 2009. In fact, direct spending on business travel by domestic and international travelers, including expenditures on meetings, events and incentive programs totaled $307.2 billion in 2016 alone.So it begs the question, what are the guiding principles hoteliers should adopt to ensure they attract their share of business travelers?There's no such thing as a "traditional" business traveler anymore. Business travelers often come with expectations that are rooted in a need for efficiency. But delivering on efficiency for those guests can't be achieved if their varying needs--and who they are--aren't understood. Business travelers are no longer the age-old, traditional, mature man. Instead, they are increasingly diverse in age, gender, nationality and career type.And, business travelers are increasingly millennials. In fact, Boston Consulting Group forecasts that by 2020 millennials will account for close to 50% of all business travel spending. And what are millennials looking for? Often it's big lobbies, and shared spaces. Being close to entertainment (or an easy way to get there) is key. They're on the go, in an Uber ride, texting on a mobile device to your staff about what they need prior to their stay.Now, naturally this is a generalization. But the point is that guest service needs aren't "traditional" anymore. We need to understand the 'who', the 'what' and the 'why' that makes up their travel profile - and their person. Remember that time is money. Efficiency is paramount for business travelers, and often they're meeting tightly scheduled agendas. They are often acutely aware of their time. This being the case, real-time service and effective integration become more important than ever. For example, business travelers expect a simple, fast and incredibly responsive booking process. Whether they book their trip online, from their mobile device or through an app, your corporate guests will expect their booking, check-in and check-out process to be entirely mobile-friendly, easy to navigate, highly visual and with the functionality to offer corporate rate logins, upgrades and loyalty options. They also expect prompt staff responses to any inquiries or issues that come up during their stay. Don't underestimate free high-quality Wi-Fi. It may seem simple, but a primary factor in booking decisions of business travelers is the availability of free wi-fi. In fact, a Research+Data Insights study found that 7 in 10 travelers say that fast, accessible Wi-Fi is more important than a hotel's location, parking facilities-- or even free breakfast. That's because a majority of business travelers carry three devices; usually a phone, a tablet and a laptop. Hotels today must be wired.It's all work...but some play. The latest trend taking shape is the rise of combined work and leisure trips, to satisfy increasing work-life balance needs. As hoteliers work to understand and embrace their millennial guests, it's important to remember that millennials have seemingly led the "be-leisure" trend, frequently adding personal days into their business trips. While not all business travelers are millennials, your hotel could offer work-life balance options such as complimentary health and fitness options, built-in packages catering to both business and pleasure, local travel advisories, tours for local hot-spots, tourist attractions, and a range of dining and entertainment options.The future is mobile, and automated. Virtual kiosks, mobile check-in, mobile keys and concierge, automatic alerts and specially curated offerings, AI technology--guest preferences continue to indicate an increased desire for automated services. According to a 2017 survey by Northstar, business travelers are optimistic when it comes to technology's role in improving their business travel experience: 48 percent would like to use text to update their travel arrangements.Not only do automated features allow for improved efficiency, they provide a critical opportunity for the collection of guest data. If you control the data, you can control the guest relationship and service. And the automation frees up your staff to interact with each guest, shaping a more personalized guest experience--all the while learning about the needs of each unique business traveler.
Article by Nicki Graham

Revenue Manager's guide to CRM

Cendyntm 9 May 2018
Behind every successful CRM program is a team of committed staff, for many hotels, they are made up of:Marketing Manager/Director of MarketingFront Office ManagerGuest Relations ManagerRevenue ManagerGeneral ManagerTo ensure that no opportunity is missed and no guest is overlooked, all members of the CRM team should have a clear understanding of their individual roles and responsibilities. In this article, we take a look at the important role the Revenue Manager plays when it comes to CRM.The Revenue Manager is primarily concerned with driving revenue. Their use of CRM software tends to be limited, but because CRM efforts have a direct impact on revenue generation they have an important stake in their success. For example, if the hotel is forecasting to fall short of budget, a targeted email campaign with an enticing offer may provide the bump in revenue needed to achieve budget. The Revenue Manager therefore works closely with the CRM team to identify revenue opportunities, create marketing campaigns, and play their part in building guest satisfaction.Key areas of responsibilityPlanning. Oversees the implementation of CRM software, staff training, testing and maintenance, and acts as key operator and liaison to the CRM provider.Pre-stay communications. As head of the reservations department, works with marketing to design pre-stay templates, including confirmations, changes and cancellations.Revenue generation. Over the course of the year, identifies periods of low and high demand and works with marketing to create targeted email campaigns to drive higher occupancy, ADR and total spend.Incremental revenue. Optimizes opportunities to increase overall spend such as upgrade offers and invitations to pre-order amenities.Data integrity. Trains agents to update guest profiles at time of reservation with thorough, accurate information and to search existing profiles to avoid duplicates.Loyalty. Ensures that agents recognize repeat guests, prioritize frequent guests for preferential treatment, and invite new guests to join the loyalty program.Communication. Loads promotions, special offers and conditions into the PMS, CRS and distribution channels and ensures that staff are aware of them.Template updates. Works with marketing to ensure that information on pre-stay templates is kept up to date, including cancellation policies, taxes, fees and hours of operation, and that guests are notified of special events, closures and renovations.Data analysis. Uses the CRM to view data and trends related to revenue generation, booking codes and sources, country of origin, and marketing campaigns.CRM tips and best practices for the Revenue ManagerCollect email. For CRM, the email address is the most vital piece of contact information. It's essential that reservations agents collect the guest's email where possible when taking voice reservations, along with mobile number and mailing address.Direct is best. Ensure that all staff understand the value of direct bookings, and work with marketing to create campaigns to encourage return guests to book directly.Get creative. Work with marketing to find creative ways to enhance the guest experience while driving incremental revenue such as suite specials, food and beverage discounts, and late checkout offers.Be a stickler. Conduct regular data quality checks to ensure that staff complete guest profiles thoroughly and accurately, bring errors and omissions to their attention.Would you like to find out more about how CRM fits in with your role? Download our full guide on CRM team best practices.
Article by Jeff Zabin

Fasten Your Seatbelt: Guest Personalization Allows Hoteliers to Soar to New Heights

Starfleet Research 9 May 2018
Note: The following article is adapted from "Built for the Cloud: A Blueprint for Hotel Technology Success" (now available for complimentary access; click here to access).Hoteliers today are increasingly focused on making their data actionable. This makes it possible to provide guests with relevant, personalized experiences. These experiences can run the gamut, from preselecting a guest's preferred room location, bed type and room temperature setting to presenting the guest with a welcome tray featuring their favorite snack plate and bottle of wine.The ability to deliver personized messages, offers and treatments is a function of being able to leverage an ever-growing mountain of guest profile data along with other types of data that reside in a centralized repository. This repository is best enabled by a true cloud technology infrastructure.With the advent of next-generation cloud PMS capabilities, hoteliers can merge all guest profile data, much of which the system automatically records, into a single dossier. The complete folio history of charges incurred and payments made by an individual guest or a corporate account during a stay, or over any specified period of time, and across multiple properties, can be readily accessed.The result is a comprehensive and detailed view of guest spending with the brand. A single consolidated view of each guest profile record, both at the property and multi-property level, means that information access can span all areas of the business and all parts of the organization.Ideally, each guest profile record within this unified repository would contain all demographic, psychographic and past purchase information for each individual guest, with the accumulated details of their stated and inferred preferences. The data would flow into the centralized cloud repository from across all parts of the property, and even from partners and other third-party sources, and be continuously updated.The data would originate from a diversity of sources. Some data may be generated through bookings and transaction channels or come from guest satisfaction surveys and even social networks. Some data may originate with the interactions that take place as casual conversations with the front desk, concierge or bartender. Some data may even come from observations recorded by the housekeeping staff and other guest-facing personnel.Advanced hospitality solutions use automated match-and-merge features to combine guest information, reducing inaccurate guest records and improving overall data quality. As a result, hoteliers can now manage guest profiles with far greater efficiency and accuracy.New capabilities also enhance collaboration for hoteliers with multiple properties by enabling them to store and manage a single instance of a unique guest profile across all parts of the enterprise. Regardless of where a guest may have stayed in the past, at what property or properties, a hotelier at any location can access their guest profile in its totality. They can know, in real-time, the guest's past purchase behavior, demonstrated preferences and any number of other details that may be pertinent in informing what specific offers, messages and treatments may resonate most effectively with -- and be appreciated by -- that individual guest.Just one of the advantages: A hotelier can know at a glance the current value of an individual guest. If appropriate, they can then escalate the guest to higher levels of service. A PMS built for the cloud enables hoteliers to better serve the needs of not only high-value guests, but, in fact, all guests. Consider the benefits of mobile access optimization that a true cloud PMS enables. Housekeeping staff can view room assignments, make status updates and track guest details in real time as they move from room to room through the property.The ability to interact with guests in relevant and personalized ways has fast become an expectation on the part of the guests themselves. Most guests are well aware of the fact that hoteliers are awash in data related to their past purchases and experiences with the hotel or with other properties under the same corporate umbrella. They expect hoteliers to recognize them, understand their wants, needs and preferences, and act on whatever information they may have collected about them to their benefit.And indeed, hoteliers have been rapidly evolving their approach to using personalization data in order to meet these rising guest expectations.It is reasonable to assume that guest personalization in the hotel industry is only in its infancy. Chances are, it will look completely different in the coming years as it continues to rapidly evolve. With big data analytics and technology innovation making it possible to soar to new heights in guest personalization, hoteliers should fasten their seat belts and prepare for the ride ahead.Note: This article is adapted from "Built for the Cloud: A Blueprint for Hotel Technology Success" (now available for complimentary access; click here to learn more).
Article by Dan Skodol

Science vs. Fiction: How the Truth of Science-Based Hotel Revenue Management Systems Surpasses the Fiction of Rules-Based Models

The Rainmaker Group 8 May 2018
"Science is a way of thinking much more than it is a body of knowledge."~ Carl SaganWhen it comes to developing pricing strategies, dealing with the competition, and forecasting future demand, the job of a hotel revenue manager can feel a lot like a kayaker who is continuously trying to paddle upstream. Over the past few decades, increasing access to data and advancements in technology have led today's hoteliers to a notable inflection point when it comes to choosing revenue management systems (RMS). There is an array of RMS along with other less-automated approaches to revenue management available to help hotels improve profits, and they tend to fall into one of two categories: rules-based or science-based.In today's competitive market, hoteliers need a little more science and a little less fiction - because selecting the right RMS can mean the difference between profitability and insolvency.WHY RULES-BASED RMS NO LONGER RULESeveral hotels still apply traditional rules-based revenue management. Rules-based approaches allow hoteliers to establish a standard set of "rules" that generate strategies for forecasting, pricing, and yielding different room categories and situations. While a rules-based system worked adequately in the past, when hotels were dealing with limited data, these approaches poorly leverage the abundance of data that is now available. Using a rules-based approach today leads to suboptimal pricing and yielding, and results in missed revenue opportunities for hotels.Many rules-based RMS providers promote their systems as offering dynamic pricing "optimization." In truth - and by definition - heuristics-based approaches lack the capability to achieve true optimization.1 They are neither mathematically optimized nor statistically robust enough to account for today's complex distribution landscape. In fact, most rules-based approaches to RM are simply geared towards automating the "gut-feel"-based decision making that would take place in the absence of any system. But how is a revenue manager to know if a $10 drop in rate on a slow night will truly drive the best possible revenue outcome for a hotel? This is a crucial gap that only a science-based RMS can fill.An extremely simplified example would be if a hotel offered one room category at three predetermined price points for a given night: Rate #1, Rate #2, and Rate #3. In a rules-based environment, once the forecasted number of rooms reaches a certain threshold, the system automatically shuts off Rate #1 and begins offering shoppers Rate #2, and so on. This approach to pricing is not truly optimal as it fails to put all of the critical puzzle pieces, such as market conditions, competitive pricing, length-of-stay, the elasticity of demand, customer value, and shopping patterns, together in a way that drives the highest achievable revenue result.Trying to include all this valuable data into rate updates that happen multiple times per day, or over long forecast periods, creates an impossible computational challenge for a rules-based approach. Moreover, as changes occur, and more data becomes available, hotels must engage in the time-consuming process of continuously adapting rules, dealing with conflicting rules, and creating new rules as circumstances dictate. As a result, rules-based approaches are primarily reactive as opposed to proactive, unable to take essential consumer insights and real-time data into account. Ultimately, the rules-based model exposes a hotel to missed profit opportunities and less than optimal decision making.WHY SCIENCE-BASED RMS ARE THE PATH TO SUCCESS Next-generation RMS are advancing beyond the rules-based model. While revenue management is still considered both an art and a science, today's revenue professionals have access to more data than ever before. So in order to flourish, and have the desired impact on their bottom line, hotels must determine how to make the art more scientific.2True Dynamic Price OptimizationWhen it comes to pure dynamic price optimization, science-based RMS offer a more sophisticated solution over the rules-based model. True dynamic pricing is a complex task that's shaped by multiple factors such as elasticity of demand, market conditions, seasonality, and customer behavior. If you've ever shopped online at Amazon.com, and noticed prices fluctuate higher or lower after you've refreshed your browser, you've witnessed true dynamic pricing at work.In today's fast-paced, competitive, and omni-channel marketplace, a science-based approach accounts for multiple variables that influence supply and demand, and responds in real timeto changing situations. Rather than determining pricing from a finite set of previously defined options - as we saw back in our rules-based Rates #1, #2 and #3 example above - science-based models allow hotels to adjust pricing at a much greater level of precision. The system chooses rates from a continuous range of potential values that provide the greatest opportunity to capture demand at each point along the spectrum of customer price sensitivity. Studies have shown that even small variations in price can mean big differences in profitability.Effective Use of Customer DataThe ability of science-based approaches to incorporate key customer data into a hotel's forecasting and pricing strategies also makes a crucial difference in maximizing profitability. Consider how this plays out in the retail space, where two customers each purchase a Dean Martin CD from an online music store. In a rules-based environment, both customers are instantly offered a Bing Crosby CD. However, because the rules-based approach can't take advantage of available customer insights hidden within the data, the retailer misses an opportunity to increase his sale.Science-based technology takes into account that although one customer is a 60-year old who enjoys '50s music, the other is an 18-year old who only purchases classic CDs as gifts. Her shopping history reveals that her past purchases have primarily been in the alternative rock genre. In this instance, she's offered the latest Red Hot Chili Peppers release instead. She makes the purchase, even though that wasn't her initial intent in visiting the site, and the retailer has doubled his sale.Along similar lines, using data to predict a customer's purchase behavior ahead of time allows hotels to segment that customer appropriately and ultimately ensure that at any given time, only the most valuable, profitable customers have access to scarce room inventory.More Accurate ForecastingInnovative science-based RMS also utilize machine learning (ML) algorithms in some key aspects of revenue management. ML offers the capability for a system to continually refine and recalibrate its algorithms based on the inclusion of new and real-time data.Proactive science-based models utilizing ML maximize profits by performing hundreds of calculations at lightning speed. They adjust rates for rooms along with ancillary products and services, and accurately forecast different demand segments according to each segment's willingness to pay.Overall Profit GrowthWith the growing trend toward total hotel revenue management,3 revenue managers must recognize the ultimate goal is not about chasing after occupancy growth, but instead, maximizing profits across all revenue streams. This is best achieved via a science-based approach where strategies are no longer based on static rules, but instead leverage complex algorithms and extensive data sets that allow hoteliers to make informed fact-based decisions.In today's constantly shifting hotel industry landscape, a rules-based approach is deficient in the science to forecast demand or optimize pricing accurately. Science-based RMS improve data integrity, predictive analytics, generate optimal pricing strategies, and better inform your revenue management decisions. As research shows4, when implemented appropriately, a science-based RMS leads to substantially higher profits.SOURCES: 1"Distinguishing Price Optimization from Rules-Based Pricing," Revionics research white paper, May 2015,www.price-revolution.com/uploads/3/4/1/9/3419579/2015_may_revionics-whitepaper-distinguishing-price-optimization.pdf2"Revenue Management for Today & Tomorrow: 10 Questions to Consider." HSMAI, Hospitality Sales and Marketing Association International , 25 Feb. 2011, www.hsmai.org/knowledge/summary.cfm?ItemNumber=4635.3Kimes, Sheryl E. "The Future of Hotel Revenue Management." Cornell University, Cornell University School of Hotel Administration, 13 Jan. 2017, scholarship.sha.cornell.edu/cgi/viewcontent.cgi?article=1239&context=chrpubs.4Aziz, Heba Abdel, et al. "Dynamic Room Pricing Model for Hotel Revenue Management Systems." Egyptian Informatics Journal, Elsevier, 28 Sept. 2011, www.sciencedirect.com/science/article/pii/S1110866511000375
Article by Reza Etemad-Sajadi

Restaurant Revenue Management Practices: Altering Customer Perceptions

EHL 8 May 2018
Based on our research, we found that the majority of revenue management practices in the restaurant business are perceived as unfair (see Table 1). Customers though seem to accept price variations between lunch and dinner, as well as cancellations due to late arrivals.The practice which is perceived to be most unfair is the policy based on time spent at the table. Customers seem to completely reject this practice and most of the other practices.Table 1Our findings also showed that the perceived fairness of practices related to lunch/dinner, weekend/weekday and time of day price variations does influence whether customers intend to return to the restaurant in the future.The booking policy of a restaurant also has an impact on customer patronage intention. However, table management and control duration policies do not impact customer patronage intention, even if these practices are perceived unfair.Figure 1As it has taken some time for revenue management practices to become acceptable in the hotel industry, it might take more time for such policies to become acceptable to customers in the restaurant industry. At present it seems they are not yet ready for these practices.Restaurant managers, who want to apply revenue management practices, should be aware of the above findings and seek to 'educate' their clients about the advantages of such practices for themselves. This must be the priority for the company before applying these practices.Restaurateurs should communicate to clients the benefits of these practices via their employees. Indeed, when we talk about service companies, employees who are dealing with customers face-to-face are effectively our best channel of communication. So what are the specific benefits for customers? For example, price variations based on the date of booking can be very useful for clients.Nevertheless, it is the responsibility of the restaurant to make sure that this kind of practice is well understood by clients to create positive word-of-mouth.Another important issue is the profile of restaurant customers.Indeed, we discovered that young people accept better practices related to booking policy and table management than older people. The reason for that stems from the fact that they are more aware of such practices and try to keep a rein on their spending. So, they can see financial benefits for themselves from these practices.Restaurants wanting to adopt revenue management practices should also take into account the profiles of their clients.The bottom line is: applying these practices can only work if they create value for your customers, even before creating value for your restaurant.Access the full study:Are customers ready to accept revenue management practices in the restaurant industry. International Journal of Quality & Reliability Management. Reza Etemad-Sajadi (2018)
Article by Ed Watkins

A Glance Into The Future Of Revenue Management

Duetto 7 May 2018
According to Cornell University professor Bill Carroll, a lot of hospitality students who focus on careers in hotel real estate are missing great opportunities in the field of revenue management."A lot of students want to go into real estate or own hotel property, but in many cases you can make more money by running an integrated, effective revenue management program than you can as an owner," Carroll said. He is a retired clinical professor from the S.C. Johnson School of Hotel Administration at Cornell and one of the pioneers in the field of revenue management. "It's an area that's under-resourced and under-appreciated but has significant impact. It's not just operations research on steroids."While Carroll values the role of revenue management in the hotel industry, he believes there is room for the discipline to grow and expand its focus while working to improve profitability for hotels.We caught up with Carroll recently to discuss the future of hotel revenue management and distribution:Q: While revenue management has come a long way, has it fallen behind in sophistication compared to OTAs and other intermediaries?Carroll: The tenets of revenue management haven't changed. You're still performing the same thing -- which is optimizing the availability of rooms inventory -- and that hasn't changed. What the OTAs optimize is conversions, while revenue management cares about optimizing revenue for the near term.If revenue management were brought to bear to take the next step -- which is probabilistic estimates of where am I going to get bookings, not only currently but in the future -- then maybe you should focus on conversions, as well as near-term revenue.Number two, revenue management looks at the OTA as if it is a distribution channel. They're quasi search engines. If you revenue manage the OTAs as a distribution channel you make enormous errors because you discount or don't recognize both the current and future advertising and promotional value of those sites.Here are the headlines: Revenue management is a significant operations research tool, but what's missing is that we forget that the distribution channel is more than just that; it's an advertising channel, and the OTAs are as much search engines as is Google.Q: What's your take on Amazon and Google getting into the distribution business?Carroll: If you were them, wouldn't you go after the sharing economy and the Airbnbs? It might be easier, and you can serve as a more effective distribution device, and it certainly isn't as complicated. The risks of moving into the market at the sharing end -- the individual owners of properties, vacation rentals, etc. -- would be logical place to start. You don't have corporate business, sophisticated services, F&B, groups, etc.Q: There's been a lot of industry buzz over AI, Big Data, blockchain. Which will have most effect on the hotel business, especially in regard to distribution?Carroll: The opportunity is for OTAs to use blockchain technology, which allows them the opportunity to hide what they need to hide and view what needs to be seen by groups and individuals. The core of blockchain technology is the ability to decipher and sift out and manage disparate databases and compile them together by having codes that are secure and sharable.Artificial intelligence technology allows the OTAs in particular to have much richer information on price response, availability, impact of airline traffic and information on consumer choice. They have the ability to do a much better job than any chain or any individual hotel in being able to provide information. I see them executing that opportunity because in effect they make money for doing that.Q: Do you believe Airbnb is more of a threat to the hotel industry or a potential asset as a distribution platform for independents and boutiques?Carroll: It could be an opportunity for hotels, particularly the major chains. Airbnb inventory could become satellite inventory for hotel properties. If they're within walking distance to the property, they can be an extension of availability of rooms and create the ability to brand it. The chains can become curators of Airbnb-quality places to stay.The flip side is it is a chance for hotels to protect themselves from the Amazons, the Googles and OTAs who are going after inventory that is not chain-related.Q: Brand companies have been trying to drive direct bookings. What will be the ultimate effectiveness of those programs?Carroll: The jury is still out. You want to be successful with loyal guests, but the problem is thinking you can discount and offer value-added benefits and that will drive business to book direct. Two things against that: How many loyalty programs do you belong to? You're either going to compete on price or on value adds. I call it being tentatively loyal.Revenue management needs to go to understanding conversions better. It's a combination of two things: a more discrete definition of who the customer is and second of all, where the customer is connecting to the enterprise. I might be a loyal guest and you might know who I am, but I might enter into an OTA metasearch for my favorite brands and find out who has the best rate and where.If you go that route, it's not just giving the right rate to the right person at the right time. It's not just who the customer is; it's where they're looking and where they are booking.Q: How do you value the relationship between the human element and technology when it comes to the revenue management function?Carroll: There is a unique problem by not allowing human interaction. What's missing is the strategic role of price in a marketplace. Understanding the impact of making a pricing decision that could have a strategic impact on pricing is problematic. That's why you have to have a human interact on top of that pricing element.Second is the role of price for any individual consumer and ultimately it's impact on conversion at future periods of time. Screw me once, I'll never go back again. I'll never forget. It's really easy to have an operational technology tool that cranks that number out and push the red button and it works. Wrong. Consumers are human beings.Q: Are educational institutions preparing students adequately in the areas of revenue strategy, distribution, etc.?Carroll: I'm concerned there is not sufficient focus on distribution channels, courses in distribution and its impact. And I'm also concerned that revenue management is taught in many places as an operations management tool and less a strategic tool.What's missing is that students don't come away from a course understanding the dynamic nature of markets. I can teach you all the tenets of revenue management, but until you get into the game and see how it works, I don't think we're doing a good service to our students.
Article by Mark Brandau

Revenue Strategy Report: How Blockchain Could Disrupt Hotel Distribution And Loyalty

Duetto 4 May 2018
Hype surrounding blockchain technology continues to climb, despite the volatility in related cryptocurrencies like Bitcoin seen earlier this year. While it's still too early to know how these distributed-ledger technologies might change the hospitality industry, experts are starting to share details of what could be effective use cases in distribution and hotel loyalty.The interest in blockchain that seemed to burst on to the scene last year has continued in 2018. LockChain launched in January as perhaps the first blockchain-based marketplace for hotels and private accommodations. Singapore Airlines, TUI Group, citizenM Hotels and JetBlue are all experimenting with blockchain-based platforms.So far, some high-level benefits of such platforms have emerged as near- to medium-term goals in hospitality, including more efficient handling of payments, traveler verification and greater interoperability of loyalty programs. For example, blockchain could be used to authenticate "known travelers" for travel screening and security, as Canada and the Netherlands are currently testing.Hype aside, are #hotels closer to finding significant uses for #blockchain technology in distribution and #loyalty?CLICK TO TWEETIs Blockchain Really Worth the Hype as an OTA Killer?While hardly anybody can say for sure what concrete benefits the travel industry can expect from blockchain technology, Skift recently made a convincing argument that its spinoff effects could nonetheless produce positive unintended consequences.Many people are looking to distributed-ledger technology as a possible alternative to online travel agencies. If an immutable, decentralized record of hotel availability, rates and inventory could replace the OTAs -- with their high commissions -- as gatekeepers, hotels could finally exert some downward pressure on acquisition costs, the thinking goes.Perhaps other annoyances of hotel distribution could be mitigated, as some speculate. Hotels and casinos would like to cut down on huge integration fees and not have to deal with the minimum volumes required to distribute on the big OTAs. If unalterable blocks in the blockchain become the norm in distribution, could that prevent wholesalers from slashing prices and causing rate parity headaches for hotels?Let's be careful not to get ahead of ourselves. Douglas Quinby of Phocuswright threw cold water on blockchain's hype, arguing that the technology won't completely kill OTAs' hold on hotel distribution.Hotels are looking for an alternative to OTAs' vexing commissions, but consumers don't really care about that, he wrote. What the OTAs do well is solve the customer's (not the hotel's) main challenge in travel: finding the best price for a room efficiently, from among hundreds or thousands of choices with an easy-to-use interface.Commissions could be lower, but Quinby wrote correctly that these costs to hotels "are not the result of inefficient architecture." OTAs, he continued, "spend billions to acquire customers (marketing and advertising) and make sure they convert (that means investing in the technology to build easy-to-use websites with plenty of relevant options and pricing)."That's the big caveat to consider for hotels learning about and experimenting with blockchain. Hotel distribution is still about advertising. Like it or not, the intermediaries are good at allocating your hotel marketing budget to fill need periods and reach new customers.As always, the imperative to hotels and casinos is to entice guests who book on an OTA to come back via direct channels next time.Another hurdle to wide or rapid adoption of blockchain among travelers could be that many consumers aren't ready to adopt cryptocurrencies like Bitcoin en masse. How many of your customers were glad they didn't jump in to Bitcoin late in 2017 when the cryptocurrency crashed to start this year?Also, it wouldn't surprise me if a backlash against big tech companies cools consumers' enthusiasm for blockchain or crypto for the time being.How Blockchain Could Improve Hotel LoyaltyAn in-depth look from Phocuswire at blockchain's potential to improve hotel loyalty programs revealed several interesting use cases:Data sharing on the blockchain system could give hotels a much more complete profile of their guests. Hotels could use all travel data gleaned from customers' transactions made with their entire cryptocurrency "wallets," which might house several different loyalty programs and many flight or rental car purchases.Being able to value guests based on all their purchasing behaviors and their future propensity to spend is priceless data for formulating customized rates and providing a personalized booking experience.Users could feasibly accrue their rewards immediately, rather than wait a certain period of time after their stays for their points to show up in their balance.That immediacy could also allow for better cross-promotions with other vendor partners. As soon as a hotel stay occurs or a flight is taken, credit for that action from each loyalty program would go to the same decentralized ledger. This is a "smart contract" feature typical of blockchain transactions.Normally, somebody from both the hotel and the airline would have to manually reconcile the activities in a back-office database -- which often takes days or weeks to be reflected on both accounts.With a click-through agreement verified on the blockchain, more affiliate partners could be on-boarded into a hotel or casino loyalty program much faster.Thom Kozik, former VP of loyalty for Marriott International and now the chief commercial officer for Loyyal, a blockchain-based loyalty platform, made a salient point about this in the Phocuswire article. He noted that Emirates Airlines used Loyyal to add a small startup ride-sharing service, Careem, to the airline's loyalty network."That ride-sharing service may be of incredible importance to several hundred thousand members of mine in the Middle East," Kozik told Phocuswire. "But for me, with 100 million members globally, [in the old system] it's not worth the effort for my IT department to do the integration and distract them from the other work."A blockchain-enabled integration is the "much faster route to put on more lifestyle-relevant redemption and earned partnerships into the program that are more relevant to even small microsegments of my customer base," he said. "My members then are becoming more loyal to my brand and my offering, because it feels to them like I'm paying more attention to them and their needs."RELATED BLOCKCHAIN ARTICLESTravel Industry Eyes Blockchain Potential for Fees, Delays, Lost Bags (Reuters)Tech Thinks It Has a Fix for the Problems It Created: Blockchain (New York Times)The Crypto Coworking Spaces Have Arrived (The Ringer)Why Everyone Should Care About Blockchain -- Even if You Don't Understand It (Quartz)
Article by Avigail Berg-panitz

Serious And Playful Approach Of Creativity And Flexibility May Add Profit To Your Hotel

Avigail Berg-Panitz 4 May 2018
Too many companies that we thought are here for good - such as Toy R Us or other large retail stores, may disappear because they didn't anticipate the change and didn't prepare new attractions to make people, physically arrive to their places.Hotels are no exception of the negative impact of new ecommerce platforms on customers new habits and decisions making - AIRB&B.Here are some ideas to may help hotels gravitate people and be entertained and relaxed, in-house.UNIQUE ACTIVITIES TO MAKE GUESTS HAPPY:There are four attractive factors that together, or independently, grab attention, generate activities, and new spending habits and encourage people to disconnect from their chairs and from addiction to their phones /computers:SESI: SENSUAL, EXPERIENTIAL, SERENITY and INSPIRING.SENSUAL means, activating the senses together or separately in a joyful way.EXPERIENTIAL means, trying new things, and discovering new experiences. Having fun in solving challenging quests and enjoying the process.SERENITY means deep sinking into calmness and letting go of stress by a 4R process: Relax, Reset the mind, recharge vitality, and Restart activities. Serenity is a full BodyMindSpirit experienceINSPIRING means creative and Uplifting of thoughts, emotions, sensations and imagination.Whether Hotels are located- in large busy cities and /or in touristic historical areas, executive teams may find that by initiating and executing SESI activities, they added significant value to marketing, branding and sales.Let's focus on this Idea:SENSORY ROOMHave you heard of "Snoezelen"?It is a type of a multidisciplinary therapy originally founded in Holland for individuals with cognitive and developmental disabilities. Snoezelen spaces include therapeutic environment created for expressive purpose of delivering high levels of stimuli to patients with mental /emotional and physical disabilities.Take a journey into Snoezelen implementation around the world: Be impressed by variety of multisensory rooms. https://www.youtube.com/results?search_query=snoezelen+roomMultisensory rooms usually include:Sensory motor stimulation is a methodological way that uses the entire sense device to help a highly disabled person to discover his/her own body, therapist body and his/her possibilities.Tactile stimulation - teaching is the stimulation of touching through motor activity and through contact with oneself and others. One can, among other things, learn the difference between heat , cold ,light and deep pressure.Audit stimulation - teaching gets one through music and sound intonations.Visual stimulation - takes place through variety of light in intensity and color.Vestibular stimuli - teaching awareness of dynamic balance and how head and the rest of the body changes position. In addition, there is awareness to movement, muscle tone, touch, sounds and breathing. WHAT IF WE EXPAND SNOEZELEN CONCEPT, INTO HOTELS AND OFFER CHILDREN, TEEN AGERS AND ADULTS UNIQUE MULTISENSORY EXPERIENCE?A 5E-SENSORY LAB:Enable: Exploration of new mental and physical triggers, Experience new possibilities of sensations & creative capabilities, Expand perception and Empower individuals and groups of people?Image the following rooms:- Vision focused space which includes VR and Mix Reality, Video knowledge base educational content (travel, body encyclopedia, wellness know-how)- Sound & intuitive body movement - music, instruments, dancing- Taste - a kitchen & dining workshops- Aroma - explore herbs aroma workshop- Touch - touch different objects in darkness- Creative space - multidisciplinary activities of self and group expressions, expressive artThe multi-sensory environment is meant to stimulate our senses: vision, hearing, smell, touch and taste, each one separately, and combined together with body movement. Having fun together and triggering curiosity and creativity may be a great added value to a new kind of experiential entertainment.NAP FLOOR and SilentSoundSpaceHaving nap centers in large cities is an answer to a necessity, and it's not a trendy thing that will disappear. Why? Because people in the cities are more stressed, overwhelmed and suffer from fatigue and insomnia.WHAT IF HOTELS WOULD DEDICATE A FLOOR AND MAKE IT A NAP FLOOR? It's not a secret that from the moment we wake up, we automatically activate, our to-do-list. Each person with his / her own missions list. After marking a V on home and family responsibilities -- "we shut that door" and "open the work door" in our minds.Yet things are not that simple as they seem. Some issues, or unsolved problems continue to flow into the desktop of our minds while we are at work (you know: children, romantic partner, parents, neighbors, mortgage and more and more....)While most of us, do try to focus, act professionally and in a project-oriented way, as the day goes by, mental, emotional and physical stress, and worries, drain our vitality, and cloud our bodymind.AT THAT POINT, WE DESPERATELY NEED A BREAK.Lunch time is a MUST TIME to take that break in order to release tension and heavy burden of stress that was accumulated together with hunger. You have 45-60 minutes to eat, chat and take a walk, before getting back to work, work work work.Still, the second half of the day is not the same as the first one. That is why Nap Places started to pop up in large cities. Imagine you take a nap in a quiet environment, stretch your body on a nice comfortable mattress and just, let go...sounds great right?The break you need has to do with physical, emotional and mental stress. Each one of the components, fuels the other. If you don't reduce each and every stress dimension daily, it may become chronic stress. Chronic stress may elevate other chronic conditions such as insomnia, anxiety and pain.Nap places are growing because of its real need, and they are developing in the right direction, yet there is a quality component to add if people really want to reduce stress and recharge vitality and that is -Vibroacoustic Therapy.What is Vibroacoustic TherapyImagine you have an hour to escape, you may try a hotel nap center. It may be cozy with great calming and inviting atmosphere, yet your mind is still overwhelmed. Streams of chaotic thoughts, emotions, sensations, memories and imagination keep running in your head while you lie down.In order to relax, reset your mind, recharge vitality in a short period of time, you need a mechanism that will work on your body and mind simultaneously. Vibroacoustic mat or recliner, embeds special low sound transducers (speakers). An app of harmonic low sound frequencies streams one single harmonic composition of frequencies which are similar to the frequencies we all felt in our mother's womb. The transducers convert the frequencies into gentle inner body massage. The process is very soothing as the gentle waves rinse and hug you from within.After a few minutes, even a controlling type A person or a skeptic, resisting one, will eventually let go, and sink into deep calmness. The gentle sonic waves oscillations, bring mental and physical systems into deep sensation of serenity and silence. Literally, this is meditation to the cells.After 15 minutes you may fall asleep or get into a self-hypnosis mental and physical state. The vibroacoustic therapy acts as a conductor of an orchestra where the body systems are similar to the instruments. Vibroacoustic therapy attunes and calibrate all body-mind part harmonically. It breaks the circuit of the overwhelmed mind, reduces mental, emotional and physical stress and recharges vitality.After 23 minutes, you feel a boost of energy and have a clear mind to restart your daily activities.SilentSoundSpaceVibroacoustic therapy room may also be a great component to a Hotel SPA. This is a place where people shut down their phones and sink into harmonic sound of silence. From a business perspective, unlike tradition massage where you need a therapist to each individual session, in a Vibroacoustic therapy room you have one facilitator that is trained to guide several individuals to a hall with Vibro mats or recliners and in few minutes assist them to select and stream a single frequency and let him /her take a journey inward with harmonic sound bath.
Article by Terri Miller

Hotels Have a Growing Guest Loyalty Problem ... and They May Not Even Know It

Concilio Labs, Inc. 3 May 2018
"We see our customers as invited guests to a party, and we are the hosts. It's our job every day to make every important aspect of the customer experience a little bit better." - Jeff BezosThe ability to inspire guest loyalty is, without a doubt, a valuable predictor of long-term success within the hospitality industry. Loyal guests bring recurring revenue, and positive reviews, feedback, and recommendations, inspiring a virtuous circle of reward.However, there has been much discussion as of late alluding to the steady demise of traditional loyalty programs. The question has become less about how to make incremental changes to existing programs, but a larger issue entirely. Is guest loyalty dead?The short answer is no, loyalty is still very much alive. But the way that many hoteliers and brands have traditionally approached loyalty programs in a pure play "points for stay" manner is fast becoming passe.According to research by loyalty-focused agency MBLM, travel brands have the least loyal relationships with consumers when compared to other industries. This is also supported by research from Wyndham, which shows that the structure of many hotel loyalty programs leaves travelers "confused and disappointed."The challenge with points and redemption-based loyalty models is they've become so plentiful they no longer make guests feel genuinely 'special', recognized or appreciated, per se. These systems often fail to drive guest engagement, in this respect, and don't meet the needs of small-to-medium-sized brands looking to make a more personal connection with their guests.Guests should recognize loyalty with hotels based upon how they are treated by the hotel staff, the hotel brands, and how their needs are met -- not by enrolling in a program that simply incentivizes them get more room nights for free.Ideally, your loyalty program should have the capacity to look beyond transient guests who create a false hierarchy. Further, we have to consider the inclusion of Online Travel Agencies (OTAs). As they promote the availability of EXPEDIA loyalty numbers, or a booking.com number, guests may no longer see the value in expressing conscious loyalty to a specific hotel brand. OTAs typically have larger marketing budgets and can readily undermine traditional loyalty efforts.Ultimately, in this new era of travel, one-size-fits-all models are failing to impress travelers and establish long-term loyalty or getting drowned out by OTA competition, so what should hotels focus on instead?The future of hotel loyalty programs should center around personalized experiences and the creation of holistic hotel-to-guest relationships, as curated with the help of insight-driven data. Hotels should have technology in place to know who their most loyal guests are based upon data aggregation per guest, and award loyalty based on spend or night stay loyalty, rather than points. Hotels should be looking to incentivize their best customers to come back--ideally through direct booking--by targeting those guests with personalized, relevant offers each and every stay. The tiers for loyalty consideration could include average spend, positive reviews and online engagement, social media influence, booking behavior and more. With access to a comprehensive guest profile guest profile based on relevant data, these qualifying factors should be within reach for any hotel staff.With the use of data to create personalized experiences, your hotel can better deliver on your brand promise and the best service possible, while continuously exceeding guest expectations. It is only once hotels begin to see guests as individuals, rather than personas or points collectors, that loyalty can truly be of value once again.
Article by Alex Shashou

3 Benefits Of Incorporating Elements of Automation to Your Hotel Text Messaging Program

ALICE 3 May 2018
In recent beta testing, hotels that have adopted guest message automation as a part of their communication strategy have seen an increase in their guest engagement by over 25%. By using automation to help their communication with guests, pre- and at arrival, during the guest stay, and at departure, hotel staff are applying the time they save to have more meaningful interactions with guests, thus streamlining staff operations and improving the guest experience.Here are three benefits of incorporating elements of automation to your text messaging program:1. Efficiencies for hotel operationsText messaging is a powerful tool to drive guest loyalty and engagement, but proactively reaching out to guests requires a lot of time hoteliers may not have. One of the biggest benefits of text message automation is that it saves staff from sending the same welcome message or WiFi password again and again, thereby giving staff more time to have meaningful conversations with guests. 2. Speedy replies The convenience of text messaging as a way to get in touch with a hotel is increasingly expected by guests who are growing accustomed to texting with businesses. But texting is only convenient for guests if they can count on quick responses. In a previous ALICE study, guests expect a response sent by text message in 12 minutes or less, compared to 18 minutes with mobile applications and 25 minutes with email. Automating responses to frequently-asked questions makes an immediate response easy, and lets staff focus on responding to other texts in a more timely fashion.3. Improved engagement across all phases of the guest journey Performing multiple tasks simultaneously comes with the territory of the front desk. Automation allows your hotel staff to complete multiple tasks while amplifying their personalized reach before the guest even arrives on the property.Pre-Arrival: Help your guests plan their stayWith automation, hotels can communicate a welcome message before guests check in to convey a pleasant check-in experience and memorable stay:"We are so excited to have you at the hotel in X days. Is there any way we can assist you before you arrive? Just text this number to let us know."Hotels, such as the Holston House in Nashville, Tennessee, are embracing this communication method. "Text messaging automation ensures all guests feel welcomed before they step foot onto the property," Ernesto Gonzalez, Director of Rooms, emphasizes. "Given how busy the desk can be at peak times, it's difficult to expect our front desk agents to have the time to welcome every guest. Automation improves the guest experience we offer at Holston House while saving valuable time for our team. It's a win-win."At Arrival: Welcome your guestsWhen hotels use text messaging automation, hotels can set up campaigns to welcome every guest the day of arrival:"We are delighted to welcome you as our guest this evening. Please reach out to us at the Front Desk by simply replying to this text message, should you need any additional amenities for your room or have any questions during your stay."During the Guest Stay: Continuous open conversations with your guestsOnce your guests are settled into their room, text message automation continues the open conversation at the guest's convenience. Template responses to guests' frequently asked questions such as "What's the WiFi password?" and "What time does breakfast start?" can make your guest feel as if their needs have been met at any point of their stay.At Departure: Improve guest feedbackWith text messaging automation, hotels have the ability to be proactive in resolving guest issues before they checkout from the property. Sending departing surveys privately through automated text messages resolves issues before they reach review websites and hoteliers can capitalize on these complaints as insight to adjust standard operating procedures.##With automation, hotels can leverage text messaging to engage with their guests before they even arrive on the property, and save time while texting throughout a guest's stay. With text message automation, guest engagements will come across more personal pre-, during- and post-stay, heightening guest satisfaction to lead to increased brand loyalty and revenue.
Article by Martin Soler

Food for thought: Tours and Activities, a fad? State of AI in travel and more stories

Soler & Associates 2 May 2018
With two exciting new projects on the way and a lot of travel, the newsletter has been delayed. The two projects are, Tell. Trends which is a paid quarterly report on the trends, possibilities and benchmarking ideas for the hotel technology and marketing industry. It will be published both online and in paper together with several independent thought leaders of the industry. The second one is The Marketing Workshop, for hotel technology companies. Which I have briefly mentioned before. And with no further ado, let's look at what is happening.Food for thought.Tours and Activities, a fad?The recent attention on Tours and Activities has made this one of the hottest trends in travel tech recently. Even Google is beta testing their own platform. Is this because growth in the hotel space is evening out or is it really the next big thing because guests want to spend more on experiences than great hotels. And should hotels turn to building better experiences and activities within?EVERYBODY WANT A PIECEHotel's data sharing problemWhile this may or may not be limited to the hospitality industry the problem (think costs, politics and archaic system) of data and sharing amongst technology providers is one of the biggest road blocks to building a better industry. As hotels consolidate into bigger and more efficient establishments they also lose a bit of soul. Much of that soul could be regained with better technology. If PMS see themselves as operating systems for hotels (huge maybe) then they also have a responsibility to ensure other developers can build on top of that.AN OVERVIEW OF THE PMS INTEGRATIONS SCENEAI is good for travel, and hotelsWe focus a lot of our AI discussions on replacing humans and robot driven hotels. But that's mainly a pessimistic look. Reality is that humans hate repetitive tasks and machines love them. Humans are brilliant at creativity and machines aren't. If AI and machines could remove all the repetitive tasks from humans in hotels we'd have people to turn most hotels into a level of service rarely experienced. And with the ever growing competition in the space our industry should be focusing on making exceptional experiences. That will require more people, who aren't busy doing repetitive tasks they don't like doing.THE AI IN TRAVEL STATE OF THE UNIONA look into hotel P&L changesThe upside of duopolies (Expedia/Booking or Google/Facebook) is that it becomes much easier to distribute. The downside is that they control costs and investors make pretty sure those costs always go up. A look into hotel P&Ls shows that agency fees are growing at 6% rate when room revenue is growing at 2%. The open question is when will this reach breaking point. The OTA/Direct battles aren't always rational, but they might become the best way for hotels to keep their profits.HOW MUCH LONGER WILL IT WORK?OTAs really have a PR problemIn reading a quite interesting analysis into the recent acquisition by Booking of Fareharbor one thing struck me, the writer doesn't seems to look at it as a great thing for the Tours and Activities industry. The OTAs haven't (and don't seem to be trying very hard) fixed their perception problem. Big product brands tend to build a passionate community around them (Nike, Apple, Disney etc) and people are proud to associate themselves with those brands. True, it is harder in the platform/marketplace space. But Amazon is succeeding at it. If customers don't care, then they're probably not really loyal anyhow. If suppliers don't care they just consider it a necessary evil. Maybe it's time OTAs work on building great relations with suppliers.AMAZON'S TREASURE TRUCKSMoving away from tech?Whilst AccorHotels has been busy acquiring companies over the last years it seemed the tech route was becoming more and more of a focus. Except, is it really? Is AccorHotels moving away from tech back to more hotel brands? Companies have a DNA, they're hardwired in a certain way. Changing the DNA isn't easy, the switch from a hotel company to a tech company is tremendous. Yet on a recent Skift interview Sebastien Bazin aspires to be alongside Google, Facebook in terms of consumer engagement. There is no doubt about the future potential and growth in doing that. The question is how to it.ACCOR ACQUIRES MOVENPICK
Article by Donna Jackson

Aligning Software with the Human Touch

Pegasus 2 May 2018
As the General Data Protection Regulation (GDPR) looms and goes into effect within weeks, it's more critical than ever to ensure that consumer data is managed within the parameters, while also enabling hoteliers to build better relationships with their guests. The question is, what is the process that aligns the human touch and software to build and strengthen those guest relationships?Convert - Converting means turning phone calls and web visits into booked reservations. Boosting conversions mean the right offers are delivered to the right person. Direct bookings are often the result of consumers being given relevant offers so they don't book through other channels. Personalized content, like recommendations based on previous stays, or offers based on buying personas, can help. For example, maybe the offer is a free shoe shine for a business traveler, or wine upon arrival for a personal stay. People love personalization. Give your guests personalization, and they'll gravitate towards your brand.com offerings.Connect - Connecting means fulfilling the guest's needs. The key is having the right software, and using it within the parameters of GDPR, to know what those needs are. With the right software, hoteliers can connect offers, rooms, and features based on data already stored in the software program, or automatically pull data found on open social sites. Hoteliers can gain a deep understanding of who their prospects and guests are, what they care about, and ultimately how to influence their purchasing decisions. Of course, delivering this level of personalization requires granular data. Luckily, some systems on the market deliver tools that determine personalization opportunities and present them to your guests.Engage - Understanding your guest is critical to being able to engage with him or her. These days - thanks to research, big data, and social media - hoteliers can create detailed profiles of their guests much more easily than they could in the past. This not only helps with personalization but can predict future behavior as well. Again, within the parameters of GDPR, the ability to predict needs is a powerful tool. It can improve the overall guest experience. Guests want to feel that not only are they receiving value, but they are being treated like someone with whom you're engaged.Successful hotels understand the importance of taking a holistic approach to personalized guest interactions at every touch point, within the bounds of GDPR. With the right hotel software that pulls guest data from outside sources and delivers the right offers--hoteliers can enhance the total guest journey. Hoteliers can then forge long-lasting relationships in ways that only technology intersected with the human touch can deliver.
Article by Jos Schaap

5 Signs It's Time to Change Your Hotel Property Management System

StayNTouch Inc. 2 May 2018
Sticking with an outdated solution only leads to a drain on resources and the loss of opportunities while making a change to your hotel PMS can reinvigorate your brand, increase revenue, and drive loyalty. Here are five signs that it is time to change your PMS to ensure it remains and/or becomes a profitable investment.1. Your current PMS is showing its ageA common complaint about a PMS is a failure to integrate or fully implement essential new features and communication tools. Systems have gone a long way since they first emerged. Guest engagement functionality and mobility, for example, have become increasingly popular in modern systems, but legacy solutions often don't offer it. Look for a system that is cloud-based and has data accessible to every department in real-time. If your current PMS does not have the mobile, self-serve, automation, or SMS features you need, then it is time to shop for a system whose functionality matches your current requirements.2. Your employees are always frustrated with itThe true value of your PMS is fundamentally defined by the folks who use it on a daily basis. If your employees express frustration because the system is overly complicated and requires extensive onboarding or is unstable, slow and buggy with poor support offered by the vendor, it might be time to look for a new provider whose uptime and user experience is highly rated.3. You need integration with more third-party appsIn theory, any software platform can integrate with another. However, if your periphery systems don't communicate in real-time with your PMS, and data from third-party solutions needs to be entered manually, you are putting a drain on resources, productivity and risking errors. Legacy systems require expensive and time-consuming interface development that could take months (or longer) and need constant updating every time you add a new app or features change. To maximize your scalability and future-proof your operations, look for an open-source, cloud-based PMS with configurable modules like StayNTouch Rover PMS.4. Vendor support and maintenance is costing youYou know it's time for a change when your PMS when service and support is costing you time, money and productivity. On-premise systems entail constant upgrades which can get expensive, and many providers tack on hefty monthly fees for support, performance upgrades, and customizations of their software. If you invest in your own hardware, you have to put forward capital upfront. That is not the case with the cloud. A cloud-based PMS is built for high performance, data backups, reliability, security and turn-key monthly pricing which includes customer support, upgrades, monitoring, hosting and more. The cloud is also more energy-efficient than legacy infrastructures.5. You want a better return on your investmentYour PMS should not only save you time and money but also generate revenue for your business. From automated upsell and marketing to revenue management and analytics, you need a system that delivers a high return on your investment. If your system does not offer marketing automation, integrated booking engine, guest history/stay data, and simple dashboards with KPIs to better understand guests - you are missing out on reduced costs through better staff productivity, and higher revenues via better sales and more satisfied, loyal guests.Replacing your PMS may seem like an extensive undertaking, but, if you are running into one or more of these roadblocks, the decision to delay the change may well cost you more than the investment required to make a strategic update. If your property management system is holding you back and obstructing opportunities for innovation, take a fresh look at what a more modern PMS from StayNTouch can achieve.
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Hospitality Financial Leadership - Fixed/Variable Costs and Room Revenue Management

The Hotel Financial Coach 1 May 2018
What I heard concerns me because it tells me some people do not understand the fixed vs. variable components of payroll and expenses in their hotels.Quite simply put, one revenue manager told me his cost to take a room in his hotel in NYC was $290."What?" I exclaimed over the telephone."Yes, that's the cost."To which I replied, "That's the total cost of all your expenses, both fixed and variable?"Silence ensued for a moment and I said, "Let's slow things down and look at the scenario."It is noon and you have 10 rooms left to sell today, the demand for today has been strong but in the last week we have been up and down around the +10 mark. My question is, "Exactly what does it cost you in variable expenses to take those last 10 rooms and how should they be priced?"This is a very different question than: "What are costs per room occupied?" Let's look at this question first because I think it will help clean up some confusion. Here are the facts of this "rooms only" operation in New York City. In the above-simplified budget for this 295 room hotel, we can see all the expenses on an annualized basis is just north of $24 million. This number is achieved by adding the rooms pay, rooms expense, overhead pay and expense, and finally the owner's expense. We only need to divide this number by the total rooms available--which is 83,488 on an annual basis. This gives us a good measure to understand what our pricing should be to generate an annualized profit using the current cost structure.However, it does not tell us the real variable cost to take those last few rooms. Let's look at the major components of the cost to take those last few rooms. What items will we need to utilize to take those last 10 rooms that are purely variable? To determine this we must first understand the nature of the fixed expenses.The fixed expenses in this hotel at this point are many. We are already running a house count of 285 rooms and occupancy of 96.6 percent. All the costs for the following under this scenario are fixed. In other words--and this is the pivot point--it will cost no additional dollars on any of the following items to take those last 10 rooms:Front desk, guest services, reservations payrollCable televisionContract servicesLinen and uniform purchasesEquipment purchaseDecorationsAll overhead expenses and payrollAll owner expensesThe truly purely variable expenses:Room attendant payroll and benefitsLinen cleaningGuest suppliesPapersCleaning suppliesTravel agent commissionsReservation feesCredit card commissionsBrand feesEnergy (some variable)That's it for our costs to take the last 10 rooms.Let's look at the chart below for a summary:The chart clearly shows the individual costs for the variable items and the incremental profit from the sale of each room. For an annual picture let's look at the impact on profits if the hotel was able to sell these 10 rooms half the days of the year:(180 days x 10 rooms x $117) = $210,600 in additional profit that goes straight to the bottom lineThis boosts the NOP closer to 10 percent. The real impact is an additional profit of the $210K, which adds an additional $2.6 million in asset value using a very modest capitalization rate of 8:(8/100 = 12.5), therefore 12.5 x 210,600 = $2,632,500When you think about your current selling policy as it relates to last-minute inventory, make sure you have a good handle on the real variable costs to sell those last-minute rooms. Don't be confused by the big fixed cost per room stickers.Know there is a balance between building the base, yielding the inventory in the largest demand period, and selling those last rooms more often.
Article by Pierre Boettner

How to Win at the Hotel Technology Innovation Game Through Symbiotic Partnerships

hospitalityPulse, Inc. 30 April 2018
When it comes to hospitality technology, finding symbiotic technology partnerships for your product can be an advantageous way for your company and products to embrace innovation continuously. Aligning your solutions strategically with like-minded companies offering cutting-edge technology, hospitality experts can better generate ideas, streamline processes, and cultivate their product offering for eager hoteliers. In a good partnership, both partners should win, emerging from the relationship better than they were before.Of course, technology partnerships represent a dynamic, fluid relationship, and primary technology providers will be faced with important questions throughout the vetting process. How do you identify those solutions which embody the values of your product, while still pushing the envelope from an innovation perspective? Will they add value to your current offering? Will they add value to the end users of your products? Will they help to enhance guest relationships for a hotel? Finally, will they improve the financial results for the parties involved?Uncertainty about such questions can make some stakeholders unsure of how to take their technology and offering to the next level -- but rest assured, innovation through partnerships can be a real game-changer. The most innovative technology available to the hospitality industry is often a culmination of various solutions. It's crucial to see this dynamic arrangement as an opportunity, rather than as competition. To evolve your product to deliver on the demands of today's hotels and their guests, you can spend time, money and resources on development - and end up late to the party. Alternatively, you can seek out strategic partnerships with advanced technology providers that can take your product to the next level quickly. After all, if you cannot create it yourself, partnerships and combined innovation may be the answer. Here are some primary points to keep in mind when considering a symbiotic technology partnership.Recognize the Value of Emerging TechNew technological offerings are evolving at a faster pace than established ones, for a few good reasons. There is no legacy functionality to maintain compatibility with, no pre-existing code architecture and, possibly most importantly, there is little to lose, so experimentation can be much more determined. Continuously trying to stay one step ahead of the rapidly evolving demands of the modern guests can distract from important contracted deliverables. Experimenting also means accepting an uncertain outcome, something few corporations can justify to their stakeholders. Hotels are for example rapidly moving away from employee-oriented interfaces, to embrace mobile-friendly, cloud-based and data-driven solutions that enable guests to connect with them when and how they want; through an employee, or unassisted if they prefer. But go back just a few years, and you find that 'all mobile' strategies often confused the guests' expectation to be 'met on their terms', with an unstoppable 'no human interaction wanted' trend. It is these truths that only emerge through failing initiatives - something an established corporation can rarely stomach. But armed with the right technology, hotels can optimize operations, deliver on guest expectations, monetize features and amenities, target their marketing efforts, open up new communication channels with guests and offer genuinely personalized experiences. All the while, an established vendor relationship is only strengthened in the process.Hoteliers that want a more competitive edge are actively seeking out technology solutions which can readily transform their relationships with each guest and drive revenue. They want platforms that offer easy integration with current systems and actionable insights derived from valuable data sources. So, the question becomes, what technology partnerships can enhance your core offering to meet the demands of hoteliers and give your brand a competitive edge? After all, if you aren't evolving your offering with emerging tech, well, you simply aren't evolving. Finding the Right PartnersKnowing that there are technology providers that try to 'do it all' and sometimes come up short, is a "best of breed" approach the best way to go when looking a redefining your hotel technology offering? The answer is definitely yes. However, the industry as a whole needs to realize and trust the fact that the well-orchestrated technology-enhancing partnerships will help hotels optimize both guest levels and by revenues. There are a few traits that make a good technology partner. First, the company must first have the attitude of solving problems and being solution-oriented. The leadership teams must have the right expertise to make something exceptional. Furthermore, the organizations cannot be hesitant to try new things and be agile.The other issue that must be addressed when choosing a partner is support. When you have strong, symbiotic relationship that is focused on mutual success, then reliable support will follow suit. However, when the partnerships are forced or loosely aligned, then the support of the different, integrated platform may be troublesome and reflect poorly on both companies.Strategic technology relationships, from the vendor perspective, need to be integrated in a way to deliver on the partner's brand promises. If the technology partners are working together cohesively to tackle issues that have been challenging in the past, then there is a higher likelihood that the providers will work closely together to combine their solutions at an optimal level. This creates value, and in turn creates revenues, or decreases costs for all parties involved. Harnessing Different Viewpoints Add WorthGoogle is one of the world's most innovative brands, but they don't go at it alone. To continue developing breakthrough products, Google methodically seeks out partners that complement their offerings and capitalize on their unique areas of expertise.Innovative products, services and business models often come from partnerships. Having multiple vendors that have integrated their solutions to benefit the hospitality industry should be a primary goal for like-minded hotel technology companies. There is a great deal of benefit related to having multiple partners focused on the same objective as they will bring diverse viewpoints and knowledge to the table. Having this level of increased knowledge from various stakeholders will enhance technology solutions and their respective implementations. Partnering provides flexibility and speed - allowing technology providers to quickly access the technology and resources they need, rather than spending time developing them internally.By collaborating with smart visionary companies of all sizes, hotel technology providers can accelerate advancements and grow market share for both their customers and for their own brand. It's a win-win for all parties."Many ideas grow better when transplanted into another mind than in the one where they sprang up." Oliver Wendell Holmes, Sr.
Article by Richard Evans

Vacation Rentals turn to Smart Technology to Monitor Operations

The Revenue Report Card 30 April 2018
As vacation rentals continue to boom, companies are turning to smart technologies to streamline and monitor their operations. As anyone that has been in the hotel business knows, at times even well run properties encounter difficulties with guests, entrance locks and staff. The close proximity of "rooms" in a hotel enable managers to deal with these problems quickly.But vacation rental companies don't enjoy the luxury of close quarters, security on hand and centralized staff. Companies frequently have homes spread out over large geographical areas. Instead of monitoring and navigating one hotel building, homes can be spread out in a town or city and, in turn, have to be strategically overseen. Unhappy neighbors having to deal with noisy guests, arrivals who encounter difficulties with entrance locks, fumbling for light switches in dark homes and entering freezing cold or uncomfortably hot climates all take away from the overall vacation rental experience. Technologies are now available to combat these shortfalls and issues. They allow vacation rental companies to take control and action before (1) police are called, (2) before neighbors are pushed to file complaints (and petitions to ban vacation rentals in their neighborhoods), (3) to intercede when a guest is outside fiddling with a lock or (4) to avoid an injury that can occur when an arriving guest arrives to a dark home and stumbles in trying to find a light switch. Smart homes, smart phone APPS, noise monitoring devices and staff tracking, to name a few, counter these and other problems before they become nightmares. Homeowners who turn to vacation rental companies absorb utility costs incurred in their homes. If a home is cleaned and then won't be occupied for a number of days, leaving lights, air conditioning and/or heat on creates wasted energy and high cost. Further, having to send staff to that home to "turn it on" before guests arrive is inefficient and costly. Not doing so contributes to brand erosion. Outfitting smart homes that can be controlled from headquarters or smart phone APPS enables lock codes to be changed, lights to be turned on and off, live TV monitoring (to view strategic areas outside the home), premium TV channels to be programed, burglar alarm monitoring and the ability to adjust climate timely and appropriately. Noise and unruly guests, as infrequent as they may be, are a nuisance to neighbors and a bad reflection on the industry as a whole. Devices are now available that monitor decibel levels and provide alerts that enable quick action to remedy these situations. Smart phones enable immediate photo documentation of damages from housekeepers and inspectors. Some of these interact with Property Management Systems that maintain a historic trail of events that bundle all photos and related notes appropriately. Tracking appropriate staff in order to logistically manage tasks and emergencies enable managers to find quick solutions to unexpected events. This is accomplished by using smartphone GDS tracking. What's more, APPS provide mileage and justify that roving staff is, or had been, where scheduled.See an article I wrote entitled "Your Boss can Track Your Every Move - a New Vacation Rental Industry Norm?"The list of technologies goes on and on, from tracking how long it takes to clean and inspect a home, whether in house staff is spending time on personal social sites and/or furnishing the accounting department with hours in order to calculate payroll. The vacation rental business is an industry onto itself and sizable operations are turning, more and more, to smart technologies to insure guest satisfaction and appropriate courtesy to neighbors. View www.tdsovr.com for more about technologies and APPS available.
Article by Ally Orlandos

Technology in Human Resource Management

CAL Poly Pomona 30 April 2018
What keeps the hospitality industry going, especially in hotels, are the employees. Human resources (HR) have become an important asset to many hospitality businesses.Since workers in a hospitality business are the ones who make connections with the guests and make sales, it is very critical to keep the employees happy. Finding the right employee that fits into the company has also become an important component of human resource management (HRM). Lately, there emerge a lot of new trends, one of which is about employee satisfaction and growth with the aids of technology.Technology in Human ResourcesHR managers and directors come up with many strategies to recruit the "right" employees. For example, HR managers are now implementing web-based programs to assist them in their day to day work. Such implications have been put into place at Pechanga Resort and Casino. With the employment pool being over 5,000, the HR managers have to have their work cut out for them. These web-based programs can help them manage the employee records efficiently. By using such programs, employees can be easily recognized and possibly get promoted quicker than if the HR managers were going through employees' performance reviews individually.With a few HR specialists handling the questions and concerns from thousands of employees, these web-based programs can be very helpful for everyone. These specific programs can help improve the happiness of employees too. For example, employees working in companies that implement such programs will be able to skip the frustration of waiting in long lines if they want to talk to the HR about a concern. Employees also have more of chances of being recognized for the hard work they are doing.My Own Experience with Technology in Human ResourcesWorking at a large resort with over 700 employees, I know it can be hard for the small HR team to deal with each individual employee on a daily basis. Being a college student, I only work on the weekends, which does not allow me to interact with the HR team who mainly works from Monday to Friday. Thankfully, my employer has made it possible to handle the majority of HR tasks online or through an app on my phone.I can complete multiple tasks with the mobile app, such as requesting time off, calling in sick, fixing anything pertaining to insurance, and others. Without this mobile app, I would have had to fill out a form with a pen and submit the form for further review and approval. One can imagine how long it would take for the HR department to process various requests from hundreds of employees in the hotel. The mobile app also comes with other features, such as internal job postings, communicating with other co-workers, and submitting a resume. The idea of attaching an employee's resume on his/her profile allows the HR managers to easily identify the qualified employees for promotions and/or job rotations. Assisted by the technology used in HRM, the HR team are able to focus on the growth of the resort as well as the employees as a whole.In conclusion, the emerge of technology has made many changes in HRM, some of which can be very beneficial. Technology's applications allow HR managers to focus more on what is best for the employees.Is it Really For the Better?In my opinions, the new technological changes that have been implemented in HR are for the better to a large extent, but there are also some other extreme changes that may occur, such as using more sophisticated technology including artificial intelligence (AI). Many professionals in the HR field also fear to lose their job or get replaced by AI. I, however, believe there will always be a place for HR as humans were made for contact with one another, but not machines. Right now, such changes seem to be positive and have made the workplace better. As there are more millennials entering the workforce, it is inevitable that there will be more technology being used in the workplace.What do you think? Is technology helping HR or killing HR? In what way?
Article by Sherif Mamdouh

HITEC Amsterdam 2018: Why I Will Definitely Be Back

EHL 27 April 2018
While I prepared for the conference, I read up on the latest technological innovations, and on startups trying to overthrow OTAs. I read about revenue management and machine learning. Stepping off the plane in Amsterdam, I was confident I had done my homework and was ready to keep up with all the technical conversations I was going to have.Things didn't exactly go as I had planned.After attending the E20X pitch competition, going to dinner with a dozen CIOs and CFOs, and covering a panel discussion on AI and voice recognition, I realized I was not at a geeky tech conference. I was at an international gathering of highly skilled professionals, versed in a myriad of disciplines that directly or indirectly add value to the hospitality industry. This was a place where the common denominators were passion for service, love for human interactions and a genuine openness to the world.It wasn't about tech. It never has been. It was about people.Hospitality is the ultimate people business. This statement is not only valid because hotels have to satisfy their guests. Many of the exhibitors of HITEC Amsterdam expressed concern for the well-being of hotel staff, the environment and the economic welfare of the populations at the destinations. No one was competing. Burgeoning entrepreneurs, young graduates and seasoned businessmen all coalesced with a single wish: to raise the bar of how technology can better serve the hospitality industry.Although I feel women are somewhat underrepresented in the industry, I am hopeful as I see this trend decreasing when we look at the new generation of hospitality managers. For instance, Ecole hoteliere de Lausanne's student base has a slight female majority, and we will definitely see more and more of them taking leading roles in the many exciting changes to come. This was perfectly illustrated by KITRO -- the food waste company that uses AI, created by two female EHL graduates, and ultimately won the Judge's Choice Award at the E20X pitch competition.I will be looking back at the three days I've spent quite fondly. I have met so many interesting people, each with their own past, interests and aspirations and each one has helped me gain insight into the future of hospitality.As long as this spirit lives on, I will be coming back to HITEC in Europe.Sherif Mamdouh is the external communications manager at Ecole hoteliere de Lausanne (EHL) and an official guest blogger for HITEC Amsterdam 2018, which took place 11-13 April 2018 at the RAI Amsterdam Convention Centre in Amsterdam, The Netherlands.
Article by Magnus Friberg

Optimizing the Guest Experience at Every Touchpoint

Zaplox AB 26 April 2018
For most people, travel, whether in the form of a vacation, business or a mix of business and pleasure, is an opportunity to escape from ordinary. Today's demanding guest doesn't just expect easy check-in, clean rooms, and a picturesque property -- they don't want to pick and choose the elements of their stay which stand out. Instead, guests, today expect a seamless, personalized experience from start to finish, from before they step foot on in the lobby to after they leave. Guests want to know their needs are understood and taken care of, so they can lose themselves in their vacation or log a successful business trip without the stress that can so often be associated with travel and accommodations.Fortunately, technology, especially mobile, has come a long way in giving hoteliers more opportunities to optimize the guest stay - driving new standards of personalized experiences and resetting the competitive bar at the same time. To improve guest satisfaction, you need to make sure each touchpoint leads to a great visit, and that the journey as a whole delivers on guests' expectations.Pre-ArrivalThe mobile evolution is impossible to ignore, for business owners and hoteliers alike, as guests continue to demonstrate a preference for hotels which optimize their mobile functionality for pre-arrival communications, check-in and more.Further to that, 83% of guests want hotel service promotions (including restaurant, spa, etc.) on their mobile devices (SmithMicro). This desire comes as no surprise, with a mobile device being one of the most important accessories for travelers today. After all, almost every one of your guests is likely carrying a smartphone or tablet, and time spent on mobile apps is only increasing. People expect to remain connected anywhere, at any time -- and if some of the primary touchpoints of their stay can be conceptualized within their favorite device? Even better.With the right technology in place, hotels can offer the complete mobile experience to their guests before they even arrive with pre-arrival messages, curated upgrade offers and reservation overviews available right from their smartphone.Day of Arrival and On-PropertyThe shift to a more mobile experience can, in many ways, be attributed to the desire for daily task simplification. Guests today want more from each experience, but never at the cost of their time or convenience. Simplification of tasks is noted as the most important factor in the mobile travel experience (65%) while having a more personalized stay is important to mobile users and younger travelers (Adobe).Investing in the mobile experience presents hoteliers with a unique opportunity to simplify primary touchpoints of the guest experience (embracing a low-touch, convenience-driven model) while also offering increased personalization (high-touch). Guests get the best of both worlds -- quick, easy check-in when they're in a rush, and personalized offers and communications when they want something more unique. In fact, according to hotels.com, 67% of travelers are "more likely" to choose a hotel that allows guests to check in and open doors with a smartphone than a hotel that doesn't. When a hotel is optimized for a complete mobile experience, they can offer their guests frictionless, mobile check-in and check-out and mobile keyless entry to rooms, which further streamlines the arrival process for each guest. This freedom from check-in and other arrival duties empower your staff to connect with each guest in a more personal way, with those more arduous registration tasks and long lines out of the way.Furthermore, reports show that guests are more likely to engage with (and invest in) hotel upsell opportunities and upgrades without the presumed pressure of hotel staff interaction. Guests feel empowered to 'choose their experience' when given the opportunity to make purchases or upgrades through their mobile device. According to hotelexecutive.com, there's an 18% increase in room service orders when made via mobile and guests typically spend 20% more when ordering via mobile (Business Insider). This is a major revenue opportunity for your hotel powered by the inclusion of mobile for upselling, upgrades, promotions, concierge and room services.Post StayThe guest experience should not end as soon as they step foot off your property -- after all, the world of online reviews and feedback can make or break a hotel's success in the modern age. According to JD Power, 46% of guests wrote a review in the past six months. With the right technology in place, hoteliers can extend their guest courtship efforts beyond the confines of each guest's visit with personalized post-stay communications, surveys and relevant offers to drive loyalty and direct bookings.No matter how big or small your hotel business is--at the end of the day, we're all just human beings interacting with other human beings. Each touchpoint of a guest's journey is an opportunity to connect with them and transform their stay with you from being viewed as an accommodation, to an experience. By investing in every step of a guest's journey with your hotel with mobile technology and a holistic, personalized approach, you can ensure that each guest will continuously invest back in your hotel.

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