Industry Update
Opinion Article22 January 2018

Digital disruption in the hospitality industry reinforces customer experience

By Ash Sobhe, Marketing Director at HotelsCombined

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The hospitality industry has always been built on delivering a superior customer experience, and this has, for the most part, been centered around highly trained front desk staff, bespoke concierge services, and all the little "extras" that the best hotels are known for. Success in the hospitality industry today though, requires more than a friendly concierge who knows where to get the best tickets for the latest Broadway show. Customer experience in the hotel industry requires attention to the digital channel as well, especially as guests become more accustomed to and expect the option of digital, rather than face-to-face interaction.


The Internet of Things (IoT) – often associated with industrial and factory-floor operations – is moving rapidly into the hotel business, adding a level of smart automation that brings a new level of convenience and comfort to hotels which simply cannot be replicated by human staff. Smart building solutions from companies like Senseware and Axius for example, provides an IoT-driven way to monitor building and environmental systems in real time, with solutions for things like water and energy conservation, air quality monitoring, predictive maintenance, and failure detection. With the price of sensor technology rapidly decreasing, these sorts of HVAC and facilities systems can be equipped with sensors, with data sent to a central panel – so problems and failures are detected before a guest has the chance to call the front desk and complain.

We are also seeing synergies being created as both the hospitality industry, and retail both move towards digital models of service. Some of the biggest resorts have always had retail partnerships, most notably, hotel casinos which feature "retail therapy" with high-end retail brands adjacent to the casino and in the same building. J.D. Powers' Hotel Loyalty Program Satisfaction Study showed that third-party partnerships are one of the most important aspects of a hotel's loyalty program, and more hotels are partnering with third-party retail brands to fill this need.

More specifically, customers aren't just expecting retail convenience as part of their hotel stay, they are expecting retail ecommerce to be integrated into the experience. An excellent example of this type of partnership is seen with Virgin Hotels, which recently partnered with The Gap, to allow guests to order online from from the convenience of their hotel room, and then have items delivered to their room within three hours.

The most evident digital disruption in the hotel industry of course, is the ubiquitous presence of online hotel comparison platforms, which have largely made human travel agencies obsolete and have added a level of in-your-pajamas convenience to the process of reserving a hotel room. What is even more telling is that digital hotel booking has shifted very quickly from the desktop to mobile, and hotel booking engines and hotel brands alike have very quickly adapted their booking sites to accommodate this trend. Our research shows that hotel bookings on mobiles increased by 67 percent in the U.S. in 2016 compared to the previous year, with tablet bookings increasing 30 percent year-over-year, while desktop bookings increased only four percent.

The mobile trend in hospitality has become even more evident with new features such as mobile check-in, which allows guests to bypass the front desk and check in via their mobiles, and even digital room keys which replace the keycard with a mobile phone app. That same app can also allow the guest to access a variety of guest services.

The overriding concern with the move to digital is the potential for loss of personalization, but this need not be a worry. Digitized customer service and customer experience tools in the hospitality industry, when implemented correctly, only enhance the human experience by allowing those skilled humans the ability to access more information, greater levels of service, and more time to focus on making their guests comfortable.

Ash Sobhe

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