The Hotel in the Clouds: Paths to Innovation in Hospitality

In today's world of AI and smart technology, it's time for hotels to again lead the way in embracing innovation. Never has so much technological capability been available at low cost, with huge potential to build brand loyalty and counter increasing commercial pressure from Online Travel Agents (OTAs).

In the cloud.

As more hotel systems become cloud-driven, we are seeing a shift towards a customer-centric view, away from obese legacy desktop and server-based systems.

With open systems powered by customer data, machine learning and analytics, hoteliers can exercise customer data with more flexibility. At Equator, we work to intelligently connect these systems. There is now huge potential to deliver new forms of service through automation and machine learning, achieved through the connectivity offered by contemporary systems.

It's this path to innovation that has the potential to free the hotelier's reliance on OTAs and bring their market share down. And suggesting the transition from desktop to mobile could throw this all into jeopardy is telling only one side of the story.

Exploiting mobile.

If you're a hotelier in 2017 and your website isn't mobile friendly, your digital strategy is redundant. You won't rank in Google, you won't convert traffic and your brand will be slowly dying (at least online).

Thankfully the UK market is mature and most brands have a site that is adaptive or responsive to mobile. There is, however, still a lot of evolution required to truly exploit mobile as a device.

Today, as many hotels pass the 50% mark for mobile traffic, we are developing sites with a completely different approach - one less about mobile and more about the user.

This is what we call "Responsive Plus". The site not only adapts to the user's device but thinks intelligently about the content it shows them, based on location, time, whether they are logged in, and whether they have, or are in the middle of, booking.

A website connected to a smart CRM system with visibility of its location can tell you User X is currently in your hotel. It should then cross and up-sell services on-premise, not try and get another booking.

Deepening loyalty through mobile.

By owning the customer conversation from booking to consumption, you can create multiple new paths to revenue generation and deepening loyalty.

The 15-20% commission you hand over to the OTA starts to pale into insignificance when you compare what the loss of relationship management is worth in terms of cross and up-sell opportunities, brand building and repeat purchases.

Now, customers are arriving at the hotel with the same device they made their booking on, giving hoteliers greater insight into the look-to-book-to-stay journey.

However, in a mobile world it's typically about multiple devices and devices that 'roam'. Thankfully, technology is on hand to help navigate these challenging waters despite the decrease in search visibility and the increase in data protection.

The power of good data.

Cross Device Tracking (CDT) is a growing technology set that helps augment the hotelier's view on their investment. CDT can be achieved through apps, wireless gateways, beacons, facial recognition and biometrics. Capabilities vary depending on the user's device, apps installed and what has been enabled.

However, if you assume full capabilities are at the hotelier's disposal, it starts to bring back the ROI and behavioural tracking we experienced online three years ago. The benefits are strongly in the marketer's favour and swing only to the consumer's when used to deliver better service.

We must be good citizens with this data.

Relentlessly selling to the consumer and haunting them across devices will lead to disenfranchisement, no matter how personalised you make it. There must be a value exchange. If we don't respect this, we risk losing that relationship altogether or having legislation come in and remove our right to try and own it.

Within Equator, we've added to our insights skillset massively because we recognise these benefits but we also invest our time in ensuring we use these tools for good.

Modern machine learning.

The next big innovation is machine learning and AI technologies. What was once the preserve of few is increasingly available to many. The consumer already benefits from this technology and they're barely aware of it.

Similarly, the hotelier will be reaping the benefits of machine learning when purchasing modern programmatic display advertising or using the latest revenue management platforms.

This is an everyday technology often free to access. Google's Cloud computing platform can be tested for free, while Microsoft's natural language processing technology and Facebook's voice recognition technology are also free.

Connected environments.

These platforms offer great potential but their power is only realised when in a connected environment. An Amazon Echo is a friendly, music-playing helper on its own. However, plug it into a hotel's system, connect it to technology in a room and teach it about your world - it becomes more powerful, bringing service-driven marketing to life.

We've delivered an Alexa-based solution for Village Hotels which does all of this and more. From wakeup calls to cooling the room, we took a number of technology stacks and connected them to this AI world, making it accessible for the client and consumer.

It wasn't just Amazon's technology that made this possible. It was a hotelier with a set of contemporary, open technology platforms, our expertise in understanding and connecting those open systems and a client with an open, innovative mind.

We can't pretend in hospitality, smart assistants can replace human service. However, when we are clear about what they can do and make them do those tasks swiftly, efficiently, and gracefully, they come alive.

A 24-hour service.

Smart assistants with a clear purpose make sense, are inexpensive and deliver positive outcomes.

When they complete certain tasks commonly undertaken by call centre or front-of-house staff, this frees up employees to deliver better service elsewhere.

Additionally, these assistants don't need breaks. There are few hotels that can offer consistent service 24/7, at least not inexpensively.

By embracing AI-driven chatbot technology, a two-star business can offer four-star service without added costs.

In an industry with wafer-thin margins and only service left as a differentiator, hoteliers will have little choice but to embrace AI and use it to deliver better service, manage their rates with more intelligence and promote them online with less waste.

To download the full report, head to: https://www.eqtr.com/ideas/posts/2017/09/tech-in-the-hotel-industry/

Neil McDonald
Head of PR and Social - Equator
+44 (0) 141 229 7799
Equator