The Googles of the world could sow panic in the hotel distribution world with one click. To counter that, hoteliers need to talk, improve their systems, understand what guests want during their entire hotel journey and spend some cash.
PALMA DE MALLORCA, Spain—Hoteliers will only be able to compete with online travel agencies and other disruptors if hotel performance data sits squarely in the cloud and is able to be used by all, according to sources attending the European conference of Hospitality Sales & Marketing Association International.
Armed with better data, hoteliers then need to talk to one another.
Moderating the panel titled “Different voices,” Klaus Kohlmayr, chief evangelist of revenue-management consultancy Ideas Revenue Solutions, said this requirement was increasingly present due to the ease in which companies such as Google, Amazon and Apple could move into the hotel booking space.
One of the main takeaways from the panel was that even in the relative infancy of the world of artificial intelligence, the industry needs to move into one of seamless intelligence.
Panelists said better data is necessary because margin pressures are increasing. The road is a harsh one, with hotel firms having a lot of catching up to do.
Hotels are constrained, as they have little bits of data all over the place. That is an industry challenge, and it requires everyone to work together to get good quality data in one place, panelists said.
“Compare the job titles internally in hotels’ sales and commercial departments to those that sit in the more data-oriented firms, and you will see that the shift has happened already,” said Michael Levie, COO of CitizenM. “It is an unfair game, and the hotels remain on the losing side.”
Neus Tarrés, CEO, Sandos Hotels & Resorts, said hoteliers wear many different hats in hotel operations.
“Compared with five years ago, there are so many more things hoteliers have to do, and you have to choose between them,” said Neus Tarrés, CEO, Sandos Hotels & Resorts. “We have to see what fits well with our business model and what is profitable, and we have to be prepared to fail, test and try and constantly change teams and processes.”
Levie said the industry needs to look at technology from the viewpoint of what the guest wants both from hotels themselves and their booking processes.
“Everything is changing, including product pricing and other impacts to the guest journey. The world is changing, but of course you cannot move your hotels, so it is harder to remain relevant,” Levie said. “And (hotel industry) evolution is still slow, so if you specialize and are able to stand out a little, you stand a chance.
“Try not to be everything to everyone, learn to use the word ‘no’ more in your vocabulary, cut through the chase, bite the bullet, and make distinct choices. (CitizenM tries) to do this on a controlled owner-operator basis. I very much think more differentiation is needed.”
Panelists said there is help from the OTAs.
“OTAs want to add value to the distribution chain, with Google being the enemy,” Levie said.
There are potentially simpler tactics.
“(Hoteliers) have to adopt WeChat as a payment method, or else you will not succeed,” Levie said. “And offer more experiences.”
Levie pointed out that maybe hotel chains need to act a little more like travel agencies.
Levie said it is a mistake for hoteliers to give benefits through some channels and not others.
“When you look at a cost, it might not be what it seems to be,” he said. “There needs to be a shift to general sales. We are so entrenched in segmentation sales. You must go to where the customers want to be.”
Establishing channel costs is hard work, and even if you do not know the correct data, reacting to it in real time is challenging. Data requires a lot of processing.
“The data is there, but is it usable? No, I would say, not at this moment,” said Michael McCartan, managing director, Europe, Middle East & Africa, at revenue-management technology company Duetto.
Panelists said some tech companies have done hotels a disservice because they have set up distribution in its own silo.
“A new breed has developed that have solutions that have more data,” Levie said. “They have realized you need data on guest, marketplace and hotel, all three.”
“Data is important not just to help sell hotels but also services,” Sandos’ Tarrés said. “We must train our teams in service design, which is not just about the off-site environment but also in-house. What properties best suit the guests’ requirements for experiences?”
“Now we just anticipate what the customer wants,” he said. “We do not know. We just claim to know, and there lies the problem.”
Levie said hoteliers needed to be constantly experimenting with technology and data.
“There is an interface with the (property management system) and the door lock, but it is usually transaction-based,” he said. “When the guest checks out, the door lock stops working, but we use that as an opportunity to download what the guest has done during their stay. Otherwise we do not know when to stop breakfast. No, we guess.”
Tarrés said Google’s moves into distribution would be a threat if only because Google and others like them know effortlessly how to arrange and show content to any particular guest.
Levie said hoteliers have a lot of ground to make up in technology.
“Hotels, meanwhile, have lots of little guest-facing gadgets that serve little purpose other than being niceties,” he said. “We should not be looking at niceties, but the basics, and getting those things right.”
Tech can go too far, panelists said, noting for example guests don’t like the possibility of providing credit card details by voice.
Panelists said there are still too many friction points in the guest journey.
For example, in Palma de Mallorca, Uber does not exist, and some travelers get frustrated because they are used to seeing the exact location of their approaching taxi on a mobile screen.
Hotels could jump into this space, panelists said, but it will always take money to do so.
“We’ll eventually have open (application program interfaces), which will unlock a lot of information, but we have to realize hotels are extremely difficult to adapt and are capital-intensive,” Levie said. “Those who react fastest and have cash will win.”
Levie sees another problem is that hoteliers tend to take a very short-term view on the challenge.
“Our operational and commercial horizons need to change, or we will never get anywhere,” he said.