The role of hotel technology in a year of gains, setbacks and continued uncertainties

Published on : Monday, January 3, 2022

Just as the hotel industry was finally getting back on track, the much-needed recovery was dealt yet another blow with the emergence of the Omicron variant. As the year came to an end, hotels of all sizes and across all categories found themselves once again grappling with waves of travel restrictions and cancellations.

Let’s hope this latest setback is less severe than what we saw with the Delta variant, as a growing number of epidemiology experts are now predicting, based on emerging data, and also short-lived.

The good news for now is that occupancy levels are high compared to a year ago. Importantly, more hoteliers are now better equipped to weather further disruptions — thanks, in large part, to technology upgrades that enable agility.

To that point, the hoteliers that were able to move swiftly to reduce operating costs and streamline business processes over the course of these past two years have generally been those with a scalable and flexible technology infrastructure.

In most cases, this infrastructure is built on an open API, enhanced connectivity that facilitates the communication and transfer of data between all key technology components, including the hotel property management system (PMS), and a reporting dashboard that provides a complete, real-time view of activities and performance.

While the pandemic accelerated technology innovation and the proliferation of hotel-branded mobile apps, AI-powered chatbots and other solutions that serve as guest-facing touch points and channels, the trend toward automation, self-service and digitization had been gathering steam for more than a decade. Some of the capabilities now in high demand had already enjoyed widespread adoption in the hotel realm. The following is brief review of some of these ever-evolving capabilities for hoteliers to keep in mind as we move into 2022.


Technology and data integration

While some industry observers surmised not so long ago that the PMS might take a backseat to other platforms in a technology stack, this has not been proven to be the case. Instead, tightly integrated with a customer relationship management (CRM) solution, a central reservation system (CRS) and a revenue management system (RMS), the PMS has evolved into an all-encompassing, end-to-end system that can be customized to the needs of the hotel property or brand.

A fully-integrated PMS gives hoteliers a distinct advantage over competitors with legacy solutions and data silos. For starters, there are significant cost benefits associated with a PMS that enables “centralized shopping” of data through seamless interaction between the CRS and PMS and all other hotel solutions and modules. These benefits include reduction in losses related to errors in manual updates and delayed or lost room charge postings.

Standalone solutions and data silos are the enemy of hoteliers who strive to streamline operations, which became a primary focus following the pandemic, and deliver a superior guest experience. Seamless integration between the CRS and the PMS should be top priority in order to support reservation delivery, modification, and cancellation, as well as new and modified prices, stay controls, and inventory synchronization.

Similarly, if the hotel offers a restaurant or café, then those transactions need to be recorded in the PMS. Poor data integration can result in financial losses related to errors in manual updates and mistakes in POS consolidations at the front desk. Poor integration also prohibits the hotel from knowing how much money a guest spends with the property. CRM applications, sales and marketing systems, etc., all need to connect, interface and share data across the board.


Guest Experience Management

Today the stakes are higher than ever when it comes to improving the quality of the guest experience. Even before the pandemic disrupted the industry, most aspects of the guest journey had already migrated to digital platforms where guest interactions could be facilitated without the need for physical contact with hotel staff.

Technology can influence the quality of those guest interactions by reducing friction and increasing convenience and personalization. The ability to capture data through those interactions, and to store the data in a centralized repository, allows hoteliers to understand guests’ wants, needs, situations and preferences on an individual level — and to then act upon that understanding to deliver tailored services.

Increasingly, hoteliers are using AI-enabled devices to improve guest service inquiry response and fulfillment time while decreasing problem resolution time. They are enhancing the in-room experience by integrating technology-enabled amenities to create “the connected room of the future.” Leveraging data, connected devices can update the room with personalized music, temperature and lighting settings, anticipate the need for room service or specific information requests and predict which hotel or outside services and activities would be of interest to guests on an individual basis.


Guest personalization

Presenting guests with highly relevant messages, offers and services at the right point in time is one of the most effective ways to improve the guest experience and, ultimately, increase satisfaction and loyalty. Guests expect superior service, frictionless interactions, and personalized experiences informed by their previous behaviors and purchase history as well as their stated wants, needs and preferences (from their dietary restrictions to music and temperature preferences), throughout their hotel stay.

For hoteliers, this means having technology that enables personalization throughout the guest journey, which begins before check-in and continues after check-out. Today the onus is on hoteliers to shower guests with their undivided attention and treat them like a celebrity. Fortunately, a next-generation PMS can help hoteliers deliver on these lofty expectations.


Mobility

Mobile functionality, both staff- and guest-facing, across all hotel operations and functions was of paramount importance even before the pandemic curtailed face-to-face interactions between hotel staff and guests. From mobile booking, room assignment, check-in and check-out and keyless entry for guests to mobile service management and communication applications for hotel management and staff, mobile platform capabilities enable a more responsive service model and improved operational performance.

Having the ability to access information, including real-time performance data, and to communicate with the front desk and other departments via a smartphone or tablet, hotel staff can know when rooms are ready to be cleaned, when a service or maintenance request needs to be fulfilled, and so on. Progress can be tracked and any issues that arise can be readily identified. PMS access by employees moving around the property or working remotely via an easy-to-use, intuitive and responsive mobile interface serves to reduce guest wait times and minimize guest inconveniences while improving the overall quality of the guest experience.


Rate distribution management

Many hoteliers, including major hotel brands, have invested heavily in recent years in efforts to limit the enormous influence of the leading OTAs and drive more direct bookings through their own website properties and distribution channels. They have not always been successful.

While the OTAs will no doubt remain a necessary marketing and distribution partner, it seems likely that OTAs will not wield quite as much power as they did before the pandemic upended the industry. Still, as demand grows and occupancy eventually returns to pre-pandemic levels, hoteliers will need to maintain these partnerships in order to maximize success in securing guest bookings. That, in turn, means having technology capabilities in place that enable seamless distribution management. Hoteliers simply do not have the time and resources to manage multiple online channels manually any more than they have the time and resources to manage rates manually.

In a dynamic market characterized by continuous fluctuations in inventory and prices, and, given the number of channels through which travelers can book inventory, automatic rate distribution is imperative. Fortunately, this feature is standard in a best-of-breed PMS, allowing hoteliers to focus on broadening their marketing and distribution reach without having to make any updates manually. The technology links the PMS, the central reservations system and the revenue management system into the OTAs and any other chosen marketing and booking channels the hotel uses to “get found” by potential guests searching for hotel accommodations.

With this capability seamlessly integrated into the platform, information is instantly exchanged over a two-way connection between the hotel and the various online channels. Real-time rates, room availability and restrictions are automatically sent from the PMS to the online marketing and distribution channels, including the OTAs. When a guest room is booked via one of the third-party websites, the PMS is automatically updated to reflect the change in availability. Automatic rate distribution enables hoteliers to maximize room inventory while optimizing revenue (and mitigating the risk of overbooking, although that problem has lately been of less concern to most hoteliers).

Rates and inventory information need to propagate accurately across all channels and touchpoints, including OTAs. Otherwise, the prices that are presented to travelers on some channels may be lower than desired or rooms presented on some channels as available may, in reality, be unavailable, and the property may be overbooked. Inputting room rate and availability changes manually can result in errors that damage the brand’s reputation and at times can lead to revenue loss, which is nothing any hotelier right now can afford to risk.


Revenue management

The financial devastation wrought by the COVID-19 pandemic obliterated the normal fluctuations in demand for guest rooms and the normal functioning of a revenue management solution. An extended period of record-low occupancies has forced hoteliers to hit the “reset” button on their revenue management practices.

The historical data upon which their forecasting models traditionally relied became a lot less relevant in the “new normal” while forward-looking data, including pre-booking data, which can point to early indications of demand, became a lot more relevant. During this period, hoteliers have had to reevaluate and re-prioritize their data inputs — and, also, migrate from using “static compsets” to using “dynamic compsets.”

Fortunately, a next-generation PMS that captures and stores data related to everything from occupancy rates, ADR and booking pace to lengths of stay, booking channels and guest segments can also capture new sources of data, including “intent to travel” data that may be more suitable for forecasting in an uncertain market. Advanced revenue management solutions process increasingly large volumes of data, faster than ever before.

Importantly, revenue management is never just about “heads in beds.” Nor, for that matter, is it just about rooms. Revenue streams such as conference hosting and recreational facilities usage — which, prior to the pandemic, typically accounted for one-quarter or more of a full-service hotel’s revenues — will need to factor into the equation with the return of large-scale group events. Whether in good times or bad, hotels will fail to achieve their full revenue potential without an integrated revenue management solution.

Specialized modules

A golf pro shop management module with such features as tee time scheduling, profile/ billing and tournament management, allows a hotel to set up and maintain complete guest profiles and histories as they relate to golf activities, including financials, handicaps and records of purchases.

A spa management module tracks guest histories, medical conditions, transaction logs and preferences. An advanced housekeeping module can assign cleaning services based on available staff and amount of work to calculate the most effective way to assign staff. A concierge module includes such features as request tracking, local vendor databases and inventory management tools.

Specialized modules for valet, maintenance and other departments may also be important. Ensuring that the PMS has specialized modules built in or can accommodate add-on applications that manage specific hotel functions and facilities may be an important consideration.


Reporting and analytics

Information is power. To make smart decisions and drive continuous performance improvement, hoteliers need access to a 360-degree view of their operations at all times. With an advanced PMS, built-in performance reporting and analytics tools are flexible and sophisticated, even mirroring robust business intelligence solutions. Hoteliers can monitor occupancy trends, guest spending, market position, channel profitability and countless other business drivers. They can gain insights that might improve the guest experience and identify opportunities to improve marketing, sales and service effectiveness.

The best of today’s PMS reporting and data analytics tools come with dozens of standard dashboards that should meet most hoteliers’ day-to-day requirements and inform the decisions made in multiple departments and functions. Anyone at any technical skill level should be able to access large volumes of summarized data with sub-second response times and dynamic and high-impact reports.


Always Be Prepared

The pandemic forced hoteliers to re-examine their fundamental strategies of business preparedness and technology investment. More than anything before it, the crisis underscored the need to protect hotels from future existential threats, or at least mitigate the potential damage. Always be prepared is a good motto. That said, let’s hope we can soon go back to discussing “doom and gloom” scenarios in the hypothetical as individual and group business once again booms and 2022 brings a full recovery to the travel and hotel industry.







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