7 Tech and Travel Trends That Will Shape the Hotel Industry in 2023

2022 was something of a rollercoaster for the hotel industry. While travel demand surged from its pandemic lows, hoteliers faced new challenges such as persistent labor shortages, and new ways of interacting with technology and their guests. In this article, we’ll take a look at what trends in technology and travel will shape the hotel industry in 2023 and beyond.

Inflation will Pressure Hotels and Slow the Resurgence of ‘Revenge Travel’

Rising energy costs and persistent inflation will continue to affect guests and hotels alike. For guests, rising prices will blunt the resurgence of ‘revenge’ travel seen earlier in 2022. According to a survey by Bankrate, rising prices caused 79% of U.S. travelers to alter their travel plans during the 2022 holiday season, with many travelers opting to travel fewer days, enjoy less expensive activities and cheaper accommodations, or travel shorter distances. Rising energy costs have affected hotels as well, with over 80% of European hoteliers citing energy costs as a major concern, and 80% of UK hospitality businesses claiming that rising energy prices had “wiped out their profits.”

Many hoteliers are turning to technology to ameliorate some of these pressures. Native-cloud-based PMS platforms, for example, can deliver more power and reliability than traditional on-site PMS platforms 一 without expensive energy or maintenance costs. Integrating smart thermostats, and other forms of smart IoT technologies can reduce energy consumption without affecting the guest experience by automatically accounting for factors such as room occupancy and location within the hotel, and real-time outdoor temperatures. Modern channel managers and central reservation systems can leverage advanced AI to optimize rates and distribution mix based on a hotel’s market, region, competitors, and business goals, allowing hotels to attract price-conscious consumers without sacrificing profitability.

Hotels will Lean into Technology to Offset Persistent Labor Shortages

According to a survey conducted by the American Hotel & Lodging Association (AHLA), 87% of hotels are experiencing a staffing shortage, with 43% ranking it as their biggest challenge. These numbers are unlikely to improve as inflation continues to put upward pressure on employee wages. Many hoteliers are turning to technology to add flexibility in hiring, make up for staffing shortages, and empower employees to deliver exceptional service. Mobile and kiosk-based self-check-in can be deployed to deliver a convenient and personalized welcome experience with only a skeleton front desk staff. Similarly, mobile automation can complete a number of time-consuming administrative tasks, while mobile communication can streamline communication between the front and back-of-the-house, by instantly alerting employees when a room is ready or out of order. Modern mobile interfaces have also been specifically designed to be engaging and easy to use, which can dramatically cut down on employee training while giving hoteliers the flexibility to hire who they want, and not just who can navigate cumbersome technology.

The Continued Rise of Remote Work, Bleisure Travel, and Extended Stays

2023 will continue to see the rise of blended travel models such as bleisure travel, remote working and digital nomads, short term rentals will change how hotels do business and interact with their guests. Catering to remote workers and travelers looking for extended stay options involves more than setting up a generic hotel business center or in-suite kitchenette, hotels need to rethink everything from how they manage assets to how they design public spaces. Investing in a PMS that includes the options for hourly or day-use rates allows a hotel to cater to busy airport travelers, or remote workers looking for a respite from the monotony of working from home. Leveraging mobile and kiosk-based check-in and mobile Point-of-Sale (PoS) systems allow hotels to deemphasize the front desk, and transform the lobby into a more communal space for dining, co-working, and socializing.

Mobile Booking, Mobile Check-in, MobileEverything

The trend toward mobile has been building for some time, and will only accelerate in 2023. Although the pandemic emphasized the necessity of a mobile self-check-in option to create a quick, hygienic, and personalized welcome experience, mobile technology has the potential to enhance the entire guest experience. With almost two-thirds of internet traffic originating from mobile devices, hoteliers would be well advised to select a booking engine that is fully optimized for mobile. This includes featuring a vibrant and easy-to-use interface, a format that displays all of the information a guest would need to make a purchase, and an option to insert booking links into social media and marketing campaigns. Mobile messaging and mobile PoS platforms can extend the mobile-first experience at booking and check-in to the entire stay, giving guests a convenient way to dine and interact with staff. Hotels can also increase revenue while personalizing the guest stay by sending targeted automated offers for upgrades and amenities directly to their guests’ smartphones at any point during their stay. Even check-out can become an opportunity for personalization with mobile monetized late-check-out and mobile guest sentiment surveys.

The Expansion of Digital Payments

According to McKinsey, 82% of Americans are using some type of digital payments, including mobile and QR-code payments, while 15% of digital wallet users leave their homes regularly without a physical wallet. Hotels have taken notice, and have deployed comprehensive payment facilitation platforms that can deliver a secure and seamless payment experience for guests while preserving the mobile-first nature of their stay. Traditionally, hotels were forced to contract with multiple providers to process payments, leading to an opaque billing structure, increased errors and instances of fraud, and a generally more cumbersome experience for guests and hotels alike. Hoteliers are now turning to more consolidated, end-to-end solutions, that incorporate payment gateways, processors, and acquirers under a single umbrella service that’s fully integrated with their PMS and tech stack. This gives hotels the flexibility to meet guests where they are on payments, allowing them to pay where they want and how they want while minimizing the friction normally associated with the payment experience.

Cybersecurity will be a Major Issue for the Hospitality Industry in 2023

A 2020 Trustwave Global Security Report claimed that the hotel industry suffers 13% of all cyber attacks 一 the third-highest of all industry sectors. With the recent conflict in Ukraine and the increase in cybercrime more broadly, these numbers will only increase in 2023. Fortunately, hotel technology providers are taking these threats seriously by ensuring full GDPR compliance and utilizing multiple layers of security and encryption across their networks and applications. For secure payments, PCI DSS certification is generally seen as the gold standard, but some providers are opting for a higher PCI DSS v4.0 - Level 1 compliance, to ensure that their payments are safe from cyber attacks. Native-cloud platforms also have the natural advantage of being especially resistant to physical disasters: Not only are their servers located in secure locations outside of the hotel property, but native-cloud providers such as Amazon AWS take daily database snapshots and have automatic environment failovers to protect against physical disasters.

In 2023, Hotel Technology Will Resemble a Growing Ecosystem, Rather Than a Walled Garden

Traditional PMS systems resembled something of a walled garden: they provided hotels with a feature-rich tech stack, but with few opportunities to expand outside of certain ‘proprietary’ upgrades and integrations. This model is increasingly out of step with the modern hospitality market. Hoteliers in 2023 will be confronted with a dynamic environment that contains emerging challenges, enticing opportunities, and new traveler demands that will expand the definition of hospitality. Savvy hoteliers will leverage an ecosystem model of technological investment, where foundational platforms like the PMS and CRS utilize flexible open-API systems to integrate as many potential third-party applications as possible, with no additional costs to the user. This model allows hotels to design a tech stack that is specialized to their particular market, customer profile, and business goals and will allow them to deliver their own unique version of the ideal guest experience.

Information Technology