This is not the first time Amazon has tried to tackle the online travel space. Back in 2013-2015, Amazon attempted to do this “organically” twice with its ill-conceived Amazon Local and Amazon Destinations. Today some hoteliers would welcome another OTA player like Amazon to increase competition and lessen dependency on the OTA duopoly.
I don't believe that this is about Billions of dollars or even percentages of revenue. It's about a willingness to change, and unfortunately we are not very good at that. In our industry innovation or R&D does not have to be very technical and therefore does not have to be done by specialists.
Lots of us think that there is not enough investment in innovation in the hospitality industry. I disagree - at least as it relates to the investment by chains. When you include technology refurbishment and renewal, it is the independent properties and to a lesser extent the loosely managed brands such as Best Western individual member properties that fall behind.
Digitization means democratization. Today it is not the budget that decides but the competence of the management about success and failure. Hotels should invest first and foremost in the quality of management, in their continuous education and training.
A great question to pose and one that I will take a slightly different view on. Yes, it is obvious that Google is moving deeper into the travel space, but let's not forget their track record of monetizing consumer-led products and services is not exactly stellar.
Following a great panel at HITEC Europe with Uli Kastner, I believe Google will become a dominant player in the hotel distribution landscape after the next big economic shift. Every economic downturn has been the catalyst for a new dominant player on the distribution space.
It is inevitable – and to the benefit of the customer – that Google will become (or is already) the go-to place for researching, planning, booking and providing real-time information throughout a trip. Customers want seamless intelligence and connected experiences, and Google is uniquely positioned to connect all the dots.
Even though still in the Buzz word stage, AI will play a massive role in our industry. Most will state that it will be a customer facing technology. From concierge robots who can interact with guests to chatbots and messaging.
Revenue management systems (RMS) were once amongst the hottest technologies in our industry. Unfortunately, we have not made much progress beyond hurdle rates, last room availability and length of stay powered by basic algorithms that haven't changed much.
Artificial Intelligence is not new to the hospitality industry in the specifics of narrow intelligence. The industry has long had technology capable of providing decision support or executive information around specific and targeted sets of consolidated information.
Does anyone remember the NCR 4200. Used as the front desk and night audit posting machine? That dinosaur was replaced by what we thoughtlessly named the “PMS” (which would have been better named 'PMIS” for “information system.”) Well, it is about 46 years later and things surely have changed.
There will always be a system that is at 'the heart' of a hotel, whether we call it PMS, CRS, CRM, CRPMS or something else with a C or a P in it... We need a place where we can store inventory, rates and customers. Our problem today is that we don't have a single platform.
Hotels need to get back control of the data on their businesses and especially on their guest. the latter can be enabled by "service bus technology". Adding onto this the approach of working with SAAS platforms this starts to become possible.
The hospitality industry is definitely lagging behind other industries when it comes to technology. The check-in and check-out process for example has not fundamentally changed since, well ... ever ... In my opinion there are three main reasons (or should we say excuses?) for this, as well as many smaller ones.
A big part of this issue is due to the fragmented stakeholder situation in our industry. There is a) the brand (Franchisor) and their priorities to push the brand distribution and franchise fees. b) the management company that aims to maximize revenue and profit (as it will in most cases increase their income of management fees); and c) the owner or asset manager of the hotel who's priority is to maximize the EXIT value of the property.All these stakeholders compete for the available investments (FF&E) funds.
This is a two sided problem. Hoteliers are not investing enough into technology and will keep using it till it breaks or stops working. There are no or limited return on investment calculations that are used. Investment in technology is also too low and does not receive the priority that it should.
The awesome rise of Google's meta and the launch of Booking.basic, make rate leakage the #1 challenge for hoteliers in 2019 and 2020 - and certainly the most requested topic at the Direct Booking Summit this year.There is no escaping the cost of undercutting today - our data suggests direct bookings drop 30% when hotels are undercut.
There is a very simple solution to the rate leakage menace: 1) Subscribe to a rate parity monitoring solution like RateGain or OTA Insights to catch in real-time rate leakage offenders; 2) Investigate quickly each instance of rate leakage; 3) In case of the property working with multiple wholesalers, “put two and two together” to trace the source of the reservation and see which of the wholesalers is the offender; 4) Immediately cancel your agreement with any rate leakage offender.
Given the transparency of the Internet and the growing role of metasearch in the travel distribution process, rate leakage is a challenge that hotels can no longer ignore. Although it might be painful in the short run, AMPUTATION is the only solution that will work!.
There is an inherent value in brands as a way of reassuring guests of a certain quality due to standards imposed by brands. Especially when going to an unknown location. While online reviews have helped independent hotels for some time it is hard to know what standards the reviewer had.
The activity in the market today looks to be more of a 'land grab' for major multi-brand operators. The logic being that if I have enough brands across a broad range of the market from a quantity and quality perspective then I increase bargaining power and also exposure to an existing and future customer base.
My view is that it's not a simple topic and there are several aspects to consider. 1 - On moving in to hotel space, this is a natural progression when tracking all of the existing OTA's. Over time all of the third party players will broaden their capabilities into other markets, although all will be secondary to search engine powered travel platforms such as Google.
AirBnB is clearly a phenomenon that is disrupting the hospitality industry as we know it. I am not sure if this can be classified as a “friend or foe” but to me it is clear that the dramatic rise of this type of lodging should pose some real questions to hoteliers.
Looking at competition from the standpoint of how it is hurting profits is never a great way to look at it. That rates can't be raised is a good thing for guests. The question of the acquisition and Airbnb's intention is: what can it bring to the customer.