World Panel
Viewpoint10 October 2019

Why are there so many hospitality technology vendors in our industry? (Part I)

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(Digital Marketeers Perspective) Some hoteliers are rightfully disoriented in the current myriad of hospitality technology vendors and solutions and are dreaming of a one-stop-shop tech solution that will cover all of their PMS, RMS, CRS, Channel Manager, CRM, CMS and DMS needs. The question is, 1) is the one-stop solution already here?, 2) Will a future one-stop-shop solution be viable enough vs the current multitude of specialist hotel technology vendors... or 3) Will we never see such a solution.... and why? (also have a look at IT Professional Perspectives on this topic)

This viewpoint was created by
Max Starkov, Adjunct Professor NYU Tisch Center for Hospitality, Founder & Director at NextGuest Digital
Ross McAlpine
Director, Client Services at Vizergy
Supplier View

According to Phocuswright's State of Travel Startups report, about 2,000 travel tech startups have been founded globally since 2008 and 900 of those were created just between 2012-2014. No wonder hoteliers are feeling overwhelmed by choice and promises of the next “must-have” technology.

Right now, a hotel's commercial operations are often siloed. They operate as distinct disciplines: marketing, revenue, sales, data management and they use different, sometimes contradictory technology. Some smart operators have identified this shortcoming and are moving towards a more centralized commercial approach, perhaps driven by trends like metasearch which blur the lines of distribution and marketing.

I don't think we're anywhere close to a true all-in-one solution. The balance for all-in-one versus niche technology providers will often come down to how many vendors you are capable of managing. Each one will come with a platform, a client services team and require time to manage. A strategic view should be taken, what are the property's commercial and revenue goals and what technology stack is needed to achieve those goals? There's certainly an opportunity for hotels to consolidate to fewer providers and to concentrate on tech that can demonstrate a positive impact on the property's commercial goals. This is especially true as industry growth slows in 2020 where there's likely to be greater emphasis on cost control and management of budgets and capital expenses.

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