Success in hospitality industry revolves around meeting the ever increasing customer expectations around personalized experiences, improved functionality and authenticity. As expectations continue to evolve in tandem with technological advances, companies that can adapt swiftly will be able to stay in business.
What do hotels spend on?
Technology spending is on the rise with more and more hotels investing to enhance customer experience and meet their high expectations. The top priority in terms of spending was payment gateway security which saw an allocation of 62% of total spending in 2016 according to Insight report. In-room technology was the second priority at 56% while bandwidth and mobile engagement were the third.According to a study published in the Hospitality Technology magazine, 52% of the hotels surveyed mentioned their top priority as digital customer engagement. Direct reservations were mentioned by 56% of hotels as the leading “omni-experience” goal. More than half the hotels surveyed indicated they would spend more on technology in the coming year as compared to previous years. Improving data analysis and increased mobile engagement are some of the other priorities for hotels.With Internet of Things, automation, artificial intelligence adding to the technological milieu, it is all too easy for hotels to lose focus on the core priorities and financials. Breaking them down into four segments will help prioritize strategies.
The four essentials in hospitality
Infrastructure: Physical properties required to operate the business including electric and electronic equipment, Wi-Fi routers, phones, in room furniture, appliances and treatment plants. Servers and routers also form part of the infrastructure. It can be challenging for business owners to upgrade and install expensive new hardware or integrated automation. The focus should be on reducing expenditure with smart energy solutions, reducing carbon footprints and building a more sustainable eco-friendly structure. Moving over to cloud based solutions will help ward off huge costs involved in maintaining a server.Cloud based systems offer the advantages of lowered cost and minimum resources, faster time for deployment, better security and better data access.The millennial who are well versed with technological advances are likely to demand and prefer hotels which have smarter in room technology than others. More than 20% of hotels, according to a study, plan on increasing spending on in room technology including smart drapes, charging pads and virtual reality. Integrating such smart solutions may be easier in a new construction than upgrading an old one.
Management systems: Integrated customer relationship management (CRM) systems are the mainstay of the hospitality industry. An effective customer relationship management (CRM) system helps businesses gain valuable insights into consumer behavior. Future business and marketing strategies are shaped based on these insights to meet the high expectations and improve profit margins.CRM systems help hotels
- Gather details about the customers' preferences, opinions and purchasing habits
- Profiling and segmentation of customers to develop better marketing strategies
- Modify and adapt business strategies to improve customer experience
Guest profiles are what drive the hospitality industry’s strategies and are therefore sacrosanct. Integrated CRM tools are now available that seamlessly connect various functions including property management, automated marketing, reservation and feedback.Hotels investing in intelligent CRM tools can reap benefits such as
- Better sales with better anticipation of customer’s needs based on data
- Improved personalization of services
- Enhanced referrals
- Upsell and cross-sell to existing customer
- Better segmentation to find out which customers are more profitable
CRM tools help boost sales but selecting and investing in the right one for your business is challenging. The ideal CRM tool depends on many factors including the size of the business, the technology and automation that already exists in the hotel, what type of data you want to collect and so on. Attending webinars and seminars to find out which CRM software is better suited for your business would be prudent to make the right decisions.
Digital marketing: The digital era has led to a phenomenal growth in smartphone usage. Three in five people use smartphones to browse hotels and make reservations online. The hotel website is the primary opportunity to sell your business. Investing in attractive and clutter free website with clear content and a booking engine that is hassle free should be your top priorities in digital marketing. Guests on an average spend six minutes on a hotel website during which the best first impression needs to be created. Ratings and reviews are another major part of digital marketing. More than 60% of travelers use social media platforms when they shop, search or visit.Search engine optimization, blogs, newsletters and mobile apps are other areas to focus on to evolve a better digital marketing strategy. Automation and intelligence are key drivers of technology in digital marketing.Tools that can automate posts to different social media platforms are available. You can also get an instant update on guests’ feedback on third party review sites or on other platforms. Such automated tools can help you take the necessary remedial action to prevent future concerns.Facebook and Google analytics help you in narrowing down your customer base to the desired level or targeting a broader group. Creating marketing funnels, segmenting the audience, split testing posts and ads and remarketing strategies are possible with Facebook advertising.
Employees: Even in the age of machines, people are always going to be central to driving customer engagement. Smart integration of technology and soft skills of staff are key to sustaining profitability in the hospitality industry. Investing in training staff as an ongoing process is crucial to keep them motivated and engaged. Online short courses and training modules can be a better option to refresh the skills of on boarded employees.Language skills, guest service, communication skills, SOPs are some of the training modules offered by both private and public universities. Artificial intelligence can be used to train personnel to respond to irritated and angry customers.Before acquiring any technology, hoteliers need to ask if the new system will reduce the operational cost significantly and how it can help enhance guest experience. Finding out also if the new technology will streamline the efficiency of the staff and integrate well into the current management systems are key to making the right investments.