Automation is everywhere: you've probably seen it on marketing brochures and been pitched on it by eager sales reps. And, if you're like other professionals that spend 40% of their time on administrative tasks, you recognize the value of having more time to grow the business rather than run the business. Even so, it's easy to get carried away with buzzy trends like automation, chatbots and artificial intelligence. We start automating things simply for automation’s sake -- or because we think we should or have been told by others that we should. Instead, we really should step back to think carefully about what should be automated and what shouldn't. Then, we can analyze the utility, probability and time it takes to automate those tasks. It’s surprising to find that sometimes it’s more costly and inefficient to automate than to simply do the task manually! Other times, we’re amazed at how long it took us to automate a tedious task! To deepen your understanding on making automation work for your hotel, here's how to think about automation and its impact on hospitality. From here on out, you'll know exactly when and where automation makes sense for your hotel -- and when it's just useless marketing fluff. Defining Automation Automation refers to anything (a technology, process or procedure) that exists to reduce or eliminate inputs (human or otherwise) while maintaining (or improving) outputs; the technology, process or procedure operates independently and requires little additional intervention. In its broadest sense, automation performs tasks that used to be done by people. However, as artificial intelligence technology advances, automation also refers to autonomous decision-making to do things that humans were never able to, such as analyzing massive data sets and continuously improving forecasts, recommendations, and actions. Types of Work: Routine vs. Non-routine & Cognitive vs. Manual There are four types of work: routine or non-routine and cognitive or manual. As we’ll see, jobs blend across both, so work can be routine cognitive, routine manual, non-routine cognitive or non-routine manual. Routine vs. non-routine The first work division is between routine and non-routine tasks. Routine tasks are ones that are repetitive and stay the same, while non-routine tasks vary according to a job’s specific requirements. 1. Examples of routine tasks in hospitality: Refilling salt shakers Folding towels Printing comment cards Washing sheets Ordering blank key cards 2. Non-routine tasks include: Personalizing a welcome basket for a VIP Fielding a guest complaint Site selection for a new hotel Securing a local partnership Designing a table plan for a wedding Due to the unique nature of non-routine tasks, they are less likely to be automated than routine tasks. Although this is changing quickly. As automation reaches further into the workplace and artificial intelligence becomes more sophisticated, even non-routine tasks are increasingly automated. Cognitive vs. manual The other way to divide work is between cognitive and manual tasks. Cognitive tasks are those that rely mostly on our brains; they’re mental. Manual tasks are those we do with our bodies; they’re physical. Both need some level of training to do well, although manual tasks can generally be accomplished by any able-bodied person whereas cognitive tasks require some measure of further education. 3. Cognitive tasks in hospitality include: Scheduling staff Forecasting demand and setting rates Creating a pre-opening strategy Conducting performance reviews Doing the night audit 4. Examples of manual tasks in hospitality: Cleaning the shower Vacuuming the lobby Replacing the sheets Repairing the HVAC Creating a key card So which of these two types of tasks are more likely to be automated? In this case, cognitive tasks are much easier to automate than manual ones. That's because the manual tasks require an intimate understanding of physical space, with each task requiring a specific set of actions that are hard to replicate with a single machine. Also, manual tasks usually require hardware to automate whereas many cognitive tasks can be automated with software. For example, it's incredibly difficult to train a robot to change sheets -- although it's much more realistic to use a robot for a manual task with easily defined parameters, such as vacuuming the carpet. Trends in Types of Work The Industrial Revolution was built on routine tasks, with each worker designated to complete a single task, over and over again. Many of those jobs were eventually taken over by robots programmed to accomplish a single task at speeds and precision far beyond a human's ability. Alongside the drastic reduction in factory workers, “nonroutine cognitive” jobs became the dominant type of work. At the same time, there was a steady rise in non-routine manual work, or jobs that were physical but not repetitive. In essence, automation has dramatically reduced the number of routine jobs, leaving mostly mindless jobs that pay little and intellectually-intense jobs that pay a lot. Why does this matter? For one, the future of work has a big impact on how hotels will operate in the future. It's also about setting the scene for the transformative impact that AI-driven automation will have on the remaining two types of work: the non-routine cognitive and non-routine manual. As computers surpass humans in capabilities, even those tasks are at risk of automation. Case in Point: Google’s DeepMind AI Artificial intelligence is the final frontier of work. We’re training machines to do all of the types of work humans have traditionally done, which means that we will soon see machines doing both the non-routine cognitive and the non-routine manual work. These machines will be driven by what's called deep neural networks, which are basically virtual brains that give machines the ability to learn on their own, without training from humans. They just constantly learn and continuously improve...and yes, that means eventually becoming smarter than humans! Case in point: A computer overcame the consensus view that it would take 10 years to beat a human in Go, a famously complex game that's even harder than chess. There are so many different board positions in Go that Jeopardy champion Ken Jennings had to reach across parallel universes to explain the possibilities: “There are about 10¹⁷⁰ board positions in Go, and only 10⁸⁰ atoms in the universe. That means that if there were as many parallel universes as there are atoms in our universe (!), then the total number of atoms in all those universes combined would be close to the possibilities on a single Go board.” So how long did it take for the computer to defeat the human? Google's DeepMind artificial intelligence team built AlphaGo, which managed to defeat the world's best Go player, winning by 5 games to zero after a short period of training. The unexpected defeat marks the cusp of exponential technological change, where computers outpace humans in handling non-routing cognitive and manual work. Computer performance will soon surpass humans. Work is changing far faster than many realize: over the next 20 years, nearly half of jobs in America could be automated. This will likely be accelerated by the intense pressures on hospitality during the Covid-19 crisis; as hotels either close temporarily or manage with barebones staff, automation becomes a critical survival tool. Doing more with less is essential in a downturn, as well as when business eventually begins to pick up but isn’t yet able to support full staffing levels.Hotels must begin to seriously leverage automation and understand where and how to use it effectively. Automation is Key to a Thriving Hospitality Industry The benefits of automation for hotels are many: increased productivity, lower costs, a better experience for both staff and guests, more accurate forecasts and more precise pricing decisions. Automation means hotels will run far leaner operations and do more with less. Here's how: Revenue management: It's only in recent years that Revenue management has been democratized. Previously, only the largest brands could afford full-time revenue managers to optimize strategy. Today, independent hotels previously don’t need full-time revenue managers, as they can leverage the data-driven decision-making of revenue management software, such as Pace, that automates many of the laborious and administrative pieces of revenue management while also working 24/7 to translate the latest property and market data into optimal rates and availability. Housekeeping: Traditionally, housekeepers have relied on clipboards and paper to manage room assignments and prioritize work. This meant the department wasn't as responsive to real-time changes in guest flows. Thanks to automation, housekeeping software adjusts work assignments according to the latest business needs. It's seamless and requires no intervention, which allows the business to optimize itself as each shift unfolds. With the average hotel room clean costing between $10 and $16 this can dramatically improve efficiency and thus profitability. Guest messaging: Hotels that want to communicate easily and quickly with guests must consider how to engage on mobile. One way to meet guests on their preferred channels is to automate communications via business texting. These texts not only put important information in the hands of guests (and boost satisfaction), but also provide upselling and other revenue- generating opportunities. For instance, guests messaging platforms can be customized to respond to specific triggers, such as personalizing a check-out survey or sending a mid-stay message. Your property (and its guest) benefit greatly from communication consistently applied. Upselling: Training the front desk to “make the ask” is a great way to build a sales culture that gets more upsells. Another tactic is to deploy automated upselling that drives more revenue opportunities throughout the guest journey. Automation eliminates the failpoint of forgetting to send a campaign or neglecting to manually upload the latest guest data from the PMS into the email marketing software. It's all about consistency and efficiency, so you’ll capture more revenue and grow your property’s total revenue per available room. Personalization is also at play here, as upselling software uses your data to dynamically create segments and match them with the most relevant offers. That means higher conversions -- and more revenue. Automation, when thoughtfully applied to a hotel operation, can unlock more revenue, increase guest satisfaction, boost staff productivity and happiness, and generally make an operation run more smoothly and profitably. As you look ahead to the future of work, automation can keep your property competitive and able to respond to the dynamic needs of these quite turbulent times.
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Are you wondering how to connect with your guests? No, we’re not talking about interacting with them over social media. We’re talking about really connecting with guests, tapping into their needs and wants. If you want to build stronger guest loyalty and create the most positive experiences at your hotel, then you need to understand exactly what guests need, from their basic physiological needs up to their need for personal growth and fulfillment. In this article, we’ll explain how Maslow's Hierarchy of Needs can help you reveal what guests really want and walk you through some Maslow’s Hierarchy of Needs examples in real life. And in doing so, you can start thinking about how you can tailor your hotel’s guest experience to truly deliver surprise and delighted through elevated hospitality experiences. What is Maslow’s Hierarchy of Needs? Before we dive in, you may be scratching your head and thinking “Maslow who?” If you took a psychology course in college, the concept might be familiar, but let’s start with a Maslow’s Hierarchy of Needs definition. In studying human behavior and what motivates people, Maslow proposed that there are five categories of “needs” that drive people forward: Physiological needs: food, water, shelter, sleep Safety needs: personal security, employment, money/resources Belonging and love needs: friends, family, sense of connection Esteem needs: esteem for oneself (dignity, achievement, mastery, independence) and the desire for reputation or respect from others (status, prestige) Self-actualization needs: realizing personal potential, self-fulfillment, seeking personal growth and peak experiences Maslow also explained that these needs come in a certain order; people aren’t motivated by status or prestige, for example, if they don’t have food, water, and shelter. Once someone has satisfied their physiological, safety, and belonging needs, then they can focus on esteem and self-actualization. But how does all of this relate to hotels? Let’s explore how you can satisfy each level of guest needs with services and amenities at your hotel. Meeting hotel guests’ physiological needs As humans, our most basic needs are food, water, and shelter. Hotels, of course, provide shelter, and usually, food and beverage offerings too. So meeting this need seems pretty simple, right? In theory, yes, but many hotels still receive guest reviews that mention uncomfortable beds, loud noise, and problems with food and beverage service. While guests’ physiological needs might seem to be the easiest to satisfy, these are also the most important, because the physiological “boxes” must be checked before guests can achieve the rest of their needs. First and foremost, your hotel must ensure guests can get a good night’s sleep. Make each room a cozy, quiet oasis that’s conducive to rest with comfortable mattresses, clean sheets, soundproofing, and temperature control. Having hypoallergenic pillows and comforters available can also make a big difference for a guest with allergies. Once you’ve mastered the sleep piece, then make sure guests can always access food and water whenever the need arises. Consider adding in-room amenities like complimentary water bottles, a snack basket, a fruit bowl, or even a minibar stocked with handpicked, local items. Besides the in-room offerings, try to eliminate any friction that guests might encounter when ordering food or drinks. When your guest’s tummy is rumbling after a long day of travel, the last thing they want to do is wait on hold when trying to place a room service order, only to be told to expect a 45-minute delivery time. Technology solutions like SuitePad can streamline the ordering process, allowing guests to order room service or book restaurant reservations at the tap of a finger. If your property doesn’t have a restaurant on-site, consider selling snacks at the front desk or partnering with nearby eateries for delivery. Helping hotel guests feel safe Once you’ve satisfied guests’ most basic needs, the next step is to provide the right security measures so they feel safe at your property. In addition to standard security features like electronic room keys and CCTV, make sure all of your employees uphold safety standards like requiring ID upon check-in, calling the guest before sending a visitor up to their room, and wearing name badges at all times. Your local safety code might seem like a no-brainer, but following your area’s building safety standards is another way to satisfy the need for safety and security. Next time the code inspector arrives, maybe you’ll remember reading about Maslow’s Hierarchy of Needs and understand why their job is so important. Seemingly simple steps like clearly displaying emergency phone numbers and emergency exit procedures can help guests - especially international guests who might not know your local emergency number, for instance - feel safe at your property. Creating a space for belonging and love needs When guests feel safe at your hotel, that’s when they can relax. Whether your guests stay at your hotel specifically to relax or if they’re just trying to chill out between high-energy meetings or events, you want to make sure your hotel can allow guests to achieve their belonging and love needs - and we’re not just talking about honeymooners here! Hotels can help guests satisfy this third tier of needs by selling rooms that are suitable for a variety of different guest profiles: families, couples, groups of friends, and even solo travelers. When you have different room configurations, everyone can find the room type that suits their needs, whether that be connecting rooms so kids and parents can have some privacy or bunk bed rooms so friends can stay up all night talking. In addition to your guestrooms, maximizing your public spaces for social interaction is another great way to make your hotel most suitable for “belonging.” New hotel concepts like Yotel and CitizenM have reinvented the traditional lobby as a hybrid of coworking and social space that invites guests to connect with each other, and some hotels offer events, classes, or guided tours that promote socialization. But above all, you can focus on forming emotional connections between guests and staff, which is one of the most powerful ways to help guests feel like they belong. Give your employees the power to surprise guests with gifts or celebrate a special occasion, and you’ll create a deep connection between your guests and your team. Satisfying guests’ esteem needs Once you’ve met guests’ physiological, safety, and belonging needs, then you can move on to ego or status needs, which involve making the guest feel special and valued. If your hotel offers a loyalty program, then this idea will definitely ring a bell. Hotels can satisfy this fourth tier of needs by recognizing guests for return business during check-in, celebrating loyalty milestones with a welcome amenity, and even learning their preferences so each stay is hyper-personalized. Technology can be your friend here thanks to software like SuitePad that can track guest behavior and offer insights about guest preferences. If you learn that a certain guest always drinks a cappuccino with breakfast, for example, your server can proactively offer the guest a cappuccino when they enter the dining room. Recognizing and rewarding guest loyalty is just one way to help guests feel special. Your hotel can also provide special treatment for guests who book higher room categories, like with a dedicated check-in desk for suites. Also, if you learn that a guest is celebrating a special occasion, take that opportunity to send a bottle of sparkling wine to their room or offer a free dessert after dinner. Not only will these actions satisfy guests’ esteem needs, they also create a more positive experience, which can lead to repeat business and glowing guest reviews. Fulfilling guests’ self-actualization needs The pinnacle of Maslow’s Hierarchy of Needs is self-actualization, which refers to achieving one’s life goals or meeting one’s full potential. For some people, self-actualization means being a great parent or creating an artistic masterpiece. But for others, travel is a life goal, and your hotel can help these people cross items off of their bucket list or plan a once-in-a-lifetime trip. One way to assist guests in achieving self-actualization is with concierge service. Guests often come to the concierge desk with remarkable requests, whether it be hiring a luxury sports car or arranging behind-the-scenes access to a museum. Encouraging concierges to satisfy these requests means your hotel can help people make their dreams become reality. Looking at hospitality through the lens of Maslow’s Hierarchy of Needs can help you and your hotel understand the bigger picture of what guests want - and why they want it. Maslow’s Hierarchy can also add some structure to your operational practices and goals; for example, you need to ensure guests can get a good night’s sleep at your hotel before you invest time and money into an elaborate loyalty program. Understanding what guests really want - what motivates them - is the key to providing an exceptional guest experience, earning great reviews, and building guest loyalty.
Property owners are told they must live or die by their hotel star rating. The problem? Not all stars are created equal. Some customers refuse to stay in a hotel that’s less than five stars. Star ratings can impact purchase decisions instantly. Just one extra star communicates something about your brand’s quality, luxury, and customer service. But a four-star hotel in Europe offers a dramatically different experience than a four-star hotel in the US; and herein lies the problem for hoteliers seeking to appeal to discerning guests. How should you improve your star rating when there are so many different metrics, elements, and gradients that determine your review? There are some commonalities among hotel star rating systems that can help you narrow down where to focus your effort. Start with this guide to learn where you stand with stars – and how small changes at your property can have a big impact on your star rating. Brief History and Background of the Five-Star System Given the inconsistency of the star system around the world, it may not be a surprise that the five-star rating system used in the US didn’t originate from a member of the hospitality world. The five-star system was created by Mobil, an oil and gas company. Mobil employees traveling the country to service their gas stations and extraction sites started using a five-star system to rate hotels and make travel guides. The five-star system spread quickly, but even today, it continues to be unregulated. You read that right: in the US, the hotel star rating system is based on popular opinion. However, European hotels use four stars, rather than the American five stars, to denote the quality of a hotel. To make matters more confusing, each country has its own methodology for regulating and defining hotel star ratings. “Consequently, three stars in England is not quite the same as three stars in Spain. Worse: three stars in Barcelona is not the same as three stars in Madrid or in Seville (each region of Spain adopts its own standards),” writes Travel + Leisure. What Does Each Level of Hotel Stars Actually Mean? There’s no straightforward answer to defining each star rating explicitly. The US and other countries use completely different approaches to assigning stars; the problem is further compounded by each individual rating system’s definition of “quality.” That said, there are some general guidelines consumers and property managers should understand. First, hotel star systems measure the quality of property’s facilities: not the experience. This is critical for property managers to understand. As great as your front desk service may be, a cheerful greeting at check-in won’t change your star rating. Hotels with more stars have more facilities, such as large rooms, swimming pools, jacuzzis, and bathtubs. Each star rating will vary depending on who is doing the rating. Some countries are more prescriptive than others; likewise, different OTAs will have different criteria for what qualifies for a certain star rating. That said, there are some generalities that hotel owners can use to measure their relative position: One star: basic accommodation, small rooms; these properties do not guarantee ensuite bathrooms, 24-hour reception, or daily cleaning. Think hostels or backpacker motel rooms. Two stars: often, two-star hotels are in old buildings that can’t be renovated. These properties are a step up from one-star spots in that they probably offer a 24-hour reception, cleaning, and a basic ensuite bathroom. Amenities are still limited, but you might get a continental breakfast and a room with a phone and TV. Three stars: a typical hotel will have three stars and offer room service, ensuite bathrooms, daily cleaning, a desk or table, and Wifi. This is a standard hotel experience that most travelers expect unless they’re on a strict budget. Four stars: these hotels offer an on-site swimming pool, gym, bar/restaurant, or valet parking. They have nicer rooms and larger lobbies. Fast internet is standard. Five stars: high-end, luxury hotels get five stars. There will be a nice bar and restaurant on-site, as well as a spa, gym, big bathrooms, and comfortable beds. Amenities and facilities take a starring role (no pun intended) in achieving a higher rating. But, it’s also important to recognize some of the nuances built into OTA star ratings and the differences between countries to best assess where to spend your budget. Hotel Stars Mean Different Things Depending on Who You Ask Countries all have different approaches to how a hotel earns its star rating. Even within a country, ratings can vary by city or regional regulations. In France, the US, Germany, and the United Kingdom, how a hotel is classified is voluntary. France, for instance, allows private organizations to provide a star rating (authorized by Cofrac, the French Accreditation Committee). Other European countries, including Germany, use the HotelStars Union, which is a trade association for hotels and restaurants. The US uses AAA and Forbes Stars. But, in Italy, Spain, and Greece, the responsibility for providing a star rating falls to regional governments. Each region within Spain, for instance, will pass legislation that precisely describes the characteristics and minimum requirements each hotel must have to earn that level of stars. Public inspectors visit each property to make sure the hotel is complying with the rules assigned to each category. Travelers are rarely cognizant of the difference between a star rating assigned by a government inspector, one by a trade organization, or one assigned by fellow travelers on an online travel agency. Even among OTAs, there’s a distinct difference in how stars are assigned. Here’s a good example of how star ratings differ by platform. Rating ⭐ ⭐⭐ ⭐⭐⭐ ⭐⭐⭐⭐ ⭐⭐⭐⭐⭐ Hotels.com Small to medium property, includes phone and TV in the bedroom, no room service. 2-4 stories high, convenient to public transportation, clean but basic, no restaurant onsite More spacious rooms, decorated lobbies, medium-sized restaurants on-site; often include fitness centers or pools Large, formal hotels, well-lit rooms that are nicely decorated; offer continental breakfast; smart reception areas and room service High degree of personal service; “sumptuous” lobbies; concierge service, stylish rooms, elegant intimacy Expedia Basic, no-frills, minimal facilities, small and functional Value, clean, basic, daily housekeeping Quality, style, comfort, personalized service, better quality bedding, larger bathrooms Upscale decor, superior amenities such as turndown service and concierge Gourmet dining, luxury spa, polished service, upgraded check-in, elegant decor Michelin* n/a n/a High-quality Excellent Exceptional Forbes** n/a n/a “Recommended” properties by Forbes are those with “consistently good service and facilities” Exceptional properties with high-quality service and facilities Outstanding, iconic properties with flawless service and amazing facilities AAA*** Essential, no-frills, budget-minded Modest in overall physical attributes, design elements, and amenities Distinguished style, upgraded quality of amenities and comfort Upscale in all areas; refined and stylish, with a high degree of hospitality, service, and attention to detail The ultimate in luxury and sophistication; extraordinary in every manner. *Michelin previously served as a reliable benchmark for discerning travelers, but the brand has since narrowed its focus to restaurants and bars. Their infamous three-star rating system is now managed by a partner called Tablet. **Forbes offers a subscription-based guide that grew directly from the original Mobil travel ratings. The team uses a checklist of 800 items to determine its star rating; they mostly focus on four and five-star properties, meaning they seek to verify luxury rather than to provide an objective review. ***AAA doesn’t limit their ratings to upscale properties, but they do use a 33-point checklist, similar to Forbes’ approach. Pre-approved properties are evaluated based on member feedback and full-time, professional evaluators. Instead of using stars, AAA rewards “diamonds”; a three-diamond property must offer televisions in every room and a swimming pool, for instance. Clearly, each platform factors different elements into their rating system. Some include guest experience metrics, such as customer service (Hotels.com) while others stay focused on amenities (Expedia). A strategy that tries to earn your property five stars on one platform may still have you falling short on another. Tech Won’t Earn Your Hotel Stars But It Certainly Helps Bottom line? Focus on providing great amenities, awesome customer service, and keeping your property up-to-date. Technology can’t directly earn you more stars from a rating agency, but it can impact your guest experience – and at the end of the day, that’s what matters. Implementing a keyless entry solution, such as the popular ASSA ABLOY Global Solutions Keyless Entry, demonstrates that you’re willing to invest in service and create a better experience. Case in point: Four Seasons Boston. The new property at One Dalton Street is a modern, 61-story skyscraper that features ASSA ABLOY custom-designed VingCard Essence door locks alongside VingCard Signature RFID locks. Details matter at this five-star property: the sleek, state-of-the-art security and access system matches the building’s design. With all electronic components encased within the door itself and only a sleek RFID/BLE reader visible to guests, VingCard Essence can circumvent the unmistakably commercial and bulky appearance of traditional hospitality-based door locks. Details like VingCard aren’t just fashionable – ASSA ABLOY keyless entry is also functional. VingCard Essence is equipped with the highest standard in security encryption protocols to protect against the risk of unauthorized access. VingCard Essence locks can be configured for mobile access, meaning that a hotel can elect to allow guests to unlock their room with a personal device – without the need to replace existing hardware. Likewise, the VingCard Essence can be configured to access guest room thermostats, helping achieve energy management goals by allowing your property to adjust temperatures when needed. Review experts are guests as much as they are critics. They are influenced by technology and personal details as much as any other guests; smart hotel tech can indirectly impact star ratings when deployed thoughtfully and strategically.
Some goals are so squishy and ill-defined that they are effectively meaningless -- and often raise more questions than answers. SMART Goals are the cure to these unfocused strategies. We’ve all had bosses setup goals that are impossible to reach because they’re so vague: ‘do right by the guest.’ (How? What’s “right?”). Be the best hotel in Miami (How? For which guest segment? Compared to whom?). Drive more revenue. (How? How much?) Ill-defined goals are also hard to measure, making them perfect shields for laziness, incompetence, and/or a general lack of accountability. Vague and general ideas can be powerful when applied to your company’s mission statement as guiding rules but when it comes to goal setting - they can kill your business. One strategy to build actionable goals that successfully motivate staff to make measurable progress is with SMART goals. Here's what you need to know about using SMART goals in hospitality, from creating the goals to some SMART goals examples in hospitality that illustrate how effective they can be. Once you experience the impact that planning SMART can have on your hotel’s productivity and success, you’ll wonder how you ever did without! What are SMART Goals? The concept of SMART goals was introduced in 1981 by George T. Doran, a consultant and former corporate planner, in a paper called “There’s a S.M.A.R.T. Way to Write Management’s Goals and Objectives.” Doran’s thesis was that achieving success requires goals to be clear and attainable, with enough specificity and measurement to actually track progress. A SMART goal is: Specific. Goals must be as specific and focused; never vague or derivative. To get precise, follow a Six Sigma principle and answer the “6 Ws:” Who needs to be involved in this goal? What are you trying to accomplish? When does this goal need to be accomplished? Where does this goal apply? Especially useful if this is related to a time-bound event or a particular department/promotion/campaign/season. Which are the essential skills needed to achieve this goal as well as any obstacles to overcome? Why is this goal important? Measurable. You've got to be able to accurately measure performance so you know unequivocally whether or not you’ve completed the goal. Achievable. Goals should be challenging but never out of reach. If a goal isn’t realistically attainable, then it may be discouraging and bad for morale. You should have enough levers/tactics to take action and realistically achieve the goal Relevant. Goals should never be a distraction from your property’s overarching objectives. If a particular goal is irrelevant to current priorities, it will not only fail to influence outcomes but it will struggle with ownership and adoption team-wide. Time-bound. For the greatest chance of success, goals must be bound by a specific timeframe. Otherwise, goals can limp on forever, without a defined end -- and thus no way to evaluate performance. SMART goals have a magical way of focusing your efforts by eliminating distractions and unproductive tangents. With a SMART goal, it's much easier to know what's working in service of your business and what's not. How to Write SMART (Goals) Now that you know all about SMART goals, let’s talk about execution. Taking the SMART approach to goal planning requires a new way of thinking about how to write goals. The defining feature of writing SMART is in the preparation: it all starts with questions. The answers will shape your goals, so you want to ask yourself and your team members as many questions as it takes to get to specific, measurable, achievable, relevant and timely goals. These questions should be approached with a positive attitude; there are no right answers and the point is simply to get closer to actionable goals that unite teams and deliver results. For each goal, start by writing down your initial goal. Then, methodically go through each part of the S.M.A.R.T acronym to further refine your goal. Finally, review your initial goal and adjust based on the results of each section to come up with your final SMART goal. Specific: What specifically do you want to achieve? Who needs to be included to make this happen? Who is ultimately responsible for achieving the goal? What steps will you take to achieve it? Measurable: How will you know when you have successfully accomplished the goal? Achievable: Given current budget and staffing, can your team realistically achieve this goal? Which tactics will you use to achieve the goal? Relevant: Why now? How does this go help us achieve our broader business objectives? Time-bound: What's the timeframe and is it realistic to accomplish this goal in that time? A few other guidelines to write SMART: Align individual, departmental and property goals. If goals are at odds with each other, there will be conflict between competing priorities. Be sure that goals align across the entire operation to keep everyone moving together in the same direction towards the same overarching business objectives. Stay focused. Distractions are the enemy of SMART. The point is to focus your energy around achievable goals, so if you find focus drifting from your core objectives then your goals are still too broad. Begin with the end in mind. Popularized by Stephen Covey in 7 Habits of Highly Effective People, this mindset is a critical part of writing SMART. Before diving into the writing phase, look ahead at your outcomes and work backwards. Clarity around what you want to achieve will focus your attention on only what matters most. Decision driver. Each goal should provide clarity and focus by helping staff decide whether or not to pursue a project. All they have to do is ask themselves whether or not a potential project, tool, initiative or campaign contributes to a relevant SMART goal. If it does, then it should be considered and if it doesn't then there's no reason to continue consideration. Set regular check-ins. Don’t just write your goals down and return to them at the end of each quarter. To track progress, set regular check-ins with relevant stakeholders and adjust your approach on the fly as needed. Then you can celebrate wins and keep everything on track. You also may want to consider creating team and individual goals. That way, individual team members understand the larger goals and their role in achieving them. This increases ownership and engagement by motivating staff towards a common purpose -- and keeps everyone moving in the same direction. SMART Goals: Examples in the Hotel Industry Before we look at a few SMART goals examples in hospitality, let’s define what’s not SMART. Avoid goals that are: Too general: “Surprise and delight guests” doesn’t give staff clarity. Immeasurable: “Streamline operations” doesn’t provide a means of measurement. Not actionable: “Improve the guest experience” doesn’t provide Irrelevant: “Be better stewards in the community” is not necessarily directly relevant to your core business. Not time bound: “Be the best hotel in our market” doesn’t set a timeframe for measuring progress towards the goal. The pitfalls of murky, ill-defined goals are many: they confuse employees; they can cause tension because team members working against each other; lack of accountability; too broad that people don’t know where to start and become paralyzed, which ultimately leads to doing nothing; dilute your brand proposition in the eyes of employees; makes management look “out of touch” and thus reduces trust. In these ways, poor planning can actually be more detrimental to a hotel’s operations than no planning at all! SMART GOAL EXAMPLE #1: Increase % of direct bookings by 10% in Q2 Instead of “be less reliant on OTAs,” a SMART goal would specify a measurable outcome that achieves the overarching goal of becoming less reliant on OTAs. Specific: In addition to the specific goal, you want to further refine the goal by defining the specific tactics required to achieve the goal, as well as who will need to be involved to implement those tactics. Answer questions like: What needs to be accomplished? Who is responsible for it? What steps will you take to achieve it? Measurable: There's a clear target of a 10% increase in direct bookings. Achievable: The goal is attainable because there are many ways to influence success: Improve rate parity with OTAs with a rate shopping tool. Adjust availability on OTAs through your channel manager. Renegotiate contracts with OTAs to get better terms. Optimize your hotel’s booking engine for conversion with a leading provider like Bookassist Spend more on digital marketing (e.g. Facebook, Instagram, Google, Tripadvisor, Kayak) to acquire direct traffic. Use CRM and email marketing to capture business from loyal guests. Implement direct booking tools that allow you to personalize the booking experience for stronger conversions. Relevant: This goal could align with an overall objective to reduce commission costs and improve profitability. It could also be relevant in the broader context of rising commissions from third parties. Time-bound: It's limited to a single quarter so performance can be measured by comparing direct booking percentage at the start of the quarter to the end of the quarter. SMART GOAL EXAMPLE #2: Grow average non-rooms revenue per guest by $37 by end of Q4 Rather than an ill-defined objective of “increase guests’ on-property spending,” this goal specifies an exact amount of guest spending increase. Specific: In addition to the specific goal, you want to further refine by answering key questions like: What needs to be accomplished? Who is responsible for it? What steps will you take to achieve it? Measurable: There's a target of increasing guest revenue of $37 per guest. Achievable: The goal is attainable, with clear tactics to drive success: Add guest messaging software or upsell tool Sell more room packages and bundled offers Improve the F&B offerings on property Retrain staff at on-property outlets to upsell verbally. Incentivize front desk staff to sell more packages at check-in Relevant: The goal may align with broader objectives to increase overall revenues, to better leverage on site amenities, and/or to improve profitability per guest. Time-bound: The goal is set to be achieved by the end of Q4, giving everyone a target time frame to achieve the goal. SMART GOAL EXAMPLE #3: Increase website conversion rate by 25% in Q2 Specific: You want to further refine the goal by defining the specific tactics required to achieve the goal, as well as who will need to be involved to implement those tactics. Be clear about: What needs to be accomplished Who is responsible for the goal What steps will you take to achieve the goal Measurable: Success measured by increase in website conversion rate Achievable: The goal can be achieved by trying different tactics: Build a new website for your hotel Add a chatbot to your website Get a faster and more mobile-friendly hotel booking engine Build conversion-optimized direct booking campaigns with a digital marketing agency such as Bookassist Relevant: The goal aligns with broader property objectives to increase direct bookings, provide a better guest experience, and/or upsell more packages and room upgrades on the website. Time-bound: Progress will be measured over a single quarter. Here are a few more examples of SMART goals for hotels to get your creative juices flowing: Grow mobile revenue by 60% (Chateau Golf & SPA d’Augerville) Increase direct bookings by 150% (Ambassador Hotel) Increase average order value by 43% (Hotel Teatro Pace) Increase metasearch reservations by 40% (The K Boutique Hotel) As you fine-tune your goals, maintain a positive attitude, motivate staff with specific goals oriented toward 1-2 property-wide objectives, and share progress so everyone can have visibility into performance and ownership of results. With SMART goals, your team can move more quickly and be much more successful at achieving desired outcomes.
Do you want to jump into an exciting new career? Or brush up on your hotel operations knowledge? The housekeeping department is a crucial part of the hotel business, but you may be wondering how exactly it functions. Housekeeping staff perform essential tasks to keep the hotel running smoothly, and a housekeeping job can be a great launchpad for a successful and fulfilling career in hotel management. In this article, we’ll define which roles you can find on a hotel’s housekeeping team, explore hotel housekeeping duties (including the duties and responsibilities of a housekeeping attendant), and offer tips for finding a job in the housekeeping department. By the end of this article, you might be inspired to consider a career in the housekeeping track - but you’ll definitely feel more appreciative of the hardworking people who make each hotel stay a pleasant one. What positions are in a hotel housekeeping department? Housekeeping teams can vary greatly depending on the size of the hotel. Small boutique hotels may have just a handful of room attendants, while giant resorts can have hundreds of housekeeping team members. The enormous MGM Grand in Las Vegas has nearly 400 room attendants working on a given day! But room attendants are just one part of the housekeeping department. The entire team can include several sub-departments, each with different responsibilities and areas of expertise. Leadership roles: In very small hotels, the room attendants might report directly to the front desk manager or the general manager, but most hotels have a leadership role within the housekeeping team. In medium-sized hotels, this role could be a Housekeeping Manager or an Executive Housekeeper, and in large hotels, there might be a Director of Housekeeping who is supported by an Assistant Director of Housekeeping, a Housekeeping Manager, or an Executive Housekeeper. The head of housekeeping is responsible for scheduling staff, managing expenses, and ensuring all rooms and public areas meet the hotel’s standards of cleanliness. Rooms: All hotels have guestrooms, so all hotels have room attendants that are responsible for cleaning rooms during and after reservations. In some hotels, floor supervisors might oversee the room attendants on each floor and perform quality control checks. Public areas: Just like guestrooms, a hotel’s public areas also need to be kept clean. Public area attendants keep the lobby, meeting spaces, restaurants, bars, offices, and any other public areas neat and tidy. Laundry: All those sheets and towels need to be cleaned somehow! Some hotels send their laundry out to an off-site laundry service, but many hotels have on-site laundry rooms. Laundry attendants are responsible for cleaning, drying, and pressing all of the hotel’s linens, towels, and uniforms. Many hotels also offer valet laundry for guest clothing, so specialized laundry staff handle those items. Some hotels also have on-site tailors and upholsterers to fix or alter uniforms, furniture, and guest clothing items. Linen room: After the sheets and towels have been washed and dried, linen attendants organize them in the linen room and distribute them to various departments in the hotel. Other roles: Some hotels have a dedicated phone operator for the housekeeping department, who answers calls from guests and other hotel departments and forwards the request to the appropriate housekeeping team member. Some hotels also have minibar attendants, who are responsible for restocking and billing minibar items, as well as housemen, who bring housekeeping items to guestrooms upon request, such as additional pillows or towels. The housekeeping department works closely with other hotel departments too. The front desk communicates with housekeeping constantly, working to coordinate check-ins and check-outs, and following through with guest requests. Housekeeping staff partner with the engineering department to resolve maintenance issues and fix broken items, and even the food and beverage department works with housekeeping to ensure linens are pressed and dining spaces are clean. Daily tasks for the hotel housekeeping department There’s never a dull moment in a hotel’s housekeeping department! The entire team works together to make the hotel shine - literally - so that guests can have the best possible experience. With so many moving parts, strong housekeeping departments utilize housekeeping technology, like Optii Solutions, to streamline communication within the department, reduce errors, prevent communication lapses, and improve overall efficiency. Communication can be challenging for a big team that often works in different areas of the hotel, so housekeeping-specific systems can make communication between the room attendants, public area attendants, laundry staff, and management team easier. But what does each member of the housekeeping department actually do each day? Housekeeping manager duties The housekeeping manager’s role is to organize the housekeeping department’s operations. He or she is usually the main point person for the housekeeping department when communicating with other departments, like in emails or meetings. The housekeeping manager sets the department’s schedule and holds the team accountable for upholding the hotel’s service standards. A housekeeping manager’s daily tasks include: Gathering arrivals and departures reports Scheduling housekeeping staff for the week or two ahead Working with the front desk to arrange special requests or welcome amenities Attending hotel leadership meetings Holding pre-shift team meetings Responding to guest requests Resolving guest service issues related to housekeeping Leveraging technology to communicate with other departments and track task completion Managing department expenses, like supply costs and payroll Room attendant duties A room attendant has one of the most important jobs in the entire hotel. If a guest’s room isn’t clean when they arrive or if essentials aren’t restocked mid-stay, then the guest can have a negative impression of the hotel. They might never stay at the hotel again, and they might write a bad review of the hotel online. On the other hand, if a room attendant goes above and beyond to provide quick service and attention to detail, the guest could have a very positive experience that inspires them to return again and again. Room attendants have a lot of responsibility and can make or break the guest’s experience. Room attendants usually work in shifts of 8 hours, during which they may clean as many as 16 guestrooms. Many hotels offer housekeeping service only once per day, so room attendants would work one daytime shift (usually 8am to 4pm, approximately), while high-end hotels that offer evening turndown service would have a second shift of housekeeping staff who work afternoon and evening hours. Some hotels also might offer 24-hour housekeeping service, so a few room attendants may work overnight shifts. Duties and responsibilities of housekeeping attendant include: Cleaning guestrooms mid-stay and after departure Making beds Replacing dirty linens and towels Restocking guestroom amenities like toiletries, drinking glasses, and notepads Removing garbage, recycling, and room service trays Picking up and returning valet laundry items Organizing and stocking housekeeping carts Notifying the maintenance department about broken appliances, old light bulbs, or damage Upholding the hotel’s confidentiality and security standards Respecting “do not disturb” signs and the guest’s privacy Public area attendant duties Like room attendants, public area attendants have a big impact on a guest’s impression of the hotel. Nobody wants to see overflowing garbage cans, dusty lobby furniture, or dirty carpets in the hallways when they stay at a hotel, so a public area attendant’s job is instrumental in creating a positive guest experience. Some public area attendants work daytime shifts, while others work evening or overnight shifts to clean high-traffic areas, like lobbies, when guests aren’t using them. A public area attendant’s daily tasks include: Cleaning public spaces like lobbies, restaurants, and meeting rooms Cleaning back-of-house areas like office and employee changing rooms Cleaning stairways, hallways, and elevators Emptying garbage cans in public areas Reporting broken items to the maintenance department Laundry/linen room attendant duties Though most laundry or linen room attendants don’t interact directly with guests, their work is crucial to the hotel’s overall operations. Without clean sheets and towels, room attendants can’t do their jobs and guests will want to stay elsewhere. Daily tasks of laundry staff or linen room staff include: Sorting, washing, drying, folding, ironing, and organizing all hotel laundry, which can include towels, sheets, bathrobes, napkins, tablecloths, uniforms, and more Removing linen that has stains or holes Operating washing and drying machines Mixing and measuring soaps, detergents, and cleaning products Handling guest valet laundry and dry cleaning within the agreed upon timeframe Skills and requirements for a hotel housekeeping employee While hotel housekeeping duties are very important - and a career in the housekeeping department can be rewarding - the work is often challenging. Housekeeping staff need a variety of skills, a passion for service, and a high level of dedication to be successful in their roles. Housekeeping employees, especially room attendants, need to be able to perform various physical activities, which can be strenuous: Push/pull a housekeeping cart Stand, walk, or kneel for an extended period of time Lift or move heavy objects, like mattresses or chairs Use hand-eye coordination and fine motor skills Besides the physical requirements, housekeeping staff must have a strong work ethic and many soft skills, including: Attention to detail Guest-forward thinking Teamwork and collaboration Organizational skills and time management Listening skills Honesty and integrity High energy levels If you’ve never worked in a housekeeping department, that’s okay! Most staff members get on-the-job training for the specific housekeeping skills needed for their role, like how to make a bed and how to operate the laundry machines. Finding a job in the housekeeping department Are you interested in working in a hotel housekeeping department? You’re in luck! Hotels are always searching for good housekeeping employees. Most hotels post their housekeeping job openings online, so you can easily search for open roles and apply online. You will be able to find job posting on individual hotel website or on popular job boards, like Indeed. In addition to applying online, you can go to a hotel and apply in person. Most large hotels have human resources departments that accept in-person job applications. Once you’ve applied (online or in person), you’ll likely need to have an interview with the hotel’s human resources department, the housekeeping manager, and maybe even the general manager, depending on the size and quality of the hotel. The housekeeping department is an essential part of hotel operations, and the hardworking staff who perform hotel housekeeping duties contribute greatly to the overall guest experience. But the staff can’t do it all alone; technology partners like Optii Solutions can help the housekeeping department run more efficiently, reduce communication gaps, and handle guest requests. Optii’s analytical features can even help housekeeping departments decrease costs and improve performance by revealing trends and areas of opportunity. With the right tools and a strong team, the housekeeping department can do their part to ensure every guest’s experience is a good one.
Even in the age of eCommerce the retail industry is thriving and innovating. Think about the last time you went shopping online or in a brick-and-mortar store. Maybe you were wowed by the brand’s focus on sustainability or your interest was piqued by an ad for an in-store event. Maybe you even interacted with the brand on social media before or after you made your purchase. In the last few years, retail brands have faced fiercer competition as many consumers shift to online shopping, especially via marketplaces like Amazon which charge hefty commissions. Sound familiar? Perhaps your hotel is under pressure too - from short-term rental competitors, OTAs, and guest review sites. If your hotel wants to add some creativity to your marketing campaigns, reach new guests, and book more rooms, let’s look to the retail industry from some inspiration. Comparing the retail industry to the hotel industry might not seem like the most logical pair at first, but as we dig into the intricacies of these two customer-focused verticals, the overlap becomes more clear. In fact, the line between retail and hospitality is blurring as brands like Parachute Mattress, Restoration Hardware, and even Taco Bell are opening hotels of their own. So how does the retail industry find success in today’s ever-changing marketplace? Let’s dig into five best practices. Focus on direct-to-consumer strategies Years ago, if you needed a new pair of jeans or a new washing machine, you would go to your reliable local department store. Department stores made sense back then, since smaller, specialized brands might not have had the marketing power to reach consumers directly. Fast forward to today, when the internet makes it possible for customers to follow brands on Instagram, retailers don’t necessarily need department stores - or any marketplace, for that matter - to sell their products. While some brands do rely on marketplaces like Amazon, others find success with no middleman whatsoever. If you’re a hotelier who’s trying to reduce your hotel’s dependence on OTAs and drive direct bookings, you can look to retail brands like Glossier as masters of the direct-to-consumer business. Glossier, a cosmetics company, only sells their products online, and, just recently, through a handful of their own boutiques. The company doesn’t distribute via Amazon, Sephora, or any department stores. Because selling directly to the consumer allows Glossier to have full control over the purchase experience, they can build a stronger relationship with their customers, and, as a result, Glossier built such a cult following that it opened its first brick-and-mortar storefront in 2018. In their stores and online, Glossier solicits feedback from customers and integrates that feedback into new products and improvements to current products. Their website is user-friendly, and loyal customers often receive freebies or access to special sales. Rather than trying to build a distribution network, Glossier invests in its direct relationship with customers and reaps the benefits of customer loyalty. Add personality to your social media channels Those department stores of the past didn’t need to have a catchy personality because consumers had much less choice then. Today brands need to have a distinct brand persona in order to stand out in a crowded marketplace - especially online. One way for customers to get acquainted with brands is via social media, and some do a great job of conveying their personality online, like Casper, Warby Parker, and Charmin. These brands, which sell mattresses, eyeglasses, and toilet paper, prove that you don’t need to sell the most exciting product to cultivate a personality that consumers love. Casper is known for its playful social media posts that often include kids and pets snuggling on one of their mattresses. Warby Parker is another brand that started online with no physical stores, but has since expanded to include brick-and-mortar shops around the country. Their social media personality is down-to-earth and lighthearted, and they often incorporate their employees in photos and videos. The brand recently posted a video showing employees reading funny misspellings of “Warby Parker” which come up in Google searches. And Charmin, a longtime toilet paper company, has gained social media fans with its signature potty humor. Emphasize sustainability Though it might seem counterintuitive for a retail company to encourage people to consume less, many brands understand that today’s consumer wants to support sustainable business practices. Consumers are shifting their preferences toward sustainable products, from food to cleaning products to clothing, and sales of products labeled as “sustainable” grew nearly 30% between 2013 and 2019. This trend is creating entirely new business models and encouraging retailers to use sustainable materials, especially in the clothing industry. While the environmental consequences of “fast fashion” make headlines, Rent the Runway is in the news for an entirely different reason - its sustainable business practices. This clothing rental service lets consumers rent high-end apparel that they wear and ship back to the company to be dry cleaned and shipped off to the next renter. Rent the Runway’s success highlights the opportunity for environmentally friendly fashion businesses, as the company reached a $1B valuation in late 2019. But retailers don’t need to create entirely new business models to be green. Allbirds, a New Zealand-based shoe company, uses a combination of merino wool, eucalyptus fibers, and recycled plastics in its footwear. This brand started from humble roots in 2014 and hit a $1.4B valuation in 2018. Hotels have been conscious about sustainability for years, but asking guests to reuse their towels for an extra day just doesn’t cut it anymore. Today’s guests expect bigger strides when it comes to reducing environmental impact. In addition to replacing tiny shampoo bottles with eco-friendly dispensers, hotels with retail outlets or sundry shops can use software like Impulsify to understand exactly what guests are buying so they can reduce waste and sell more efficiently. Turn regular public space into creative event space Stores, like hotels, often have beautiful physical spaces that sit empty for portions of the day. Some creative retailers have found alternate uses for their storefronts by hosting events, fitness classes, or even lectures during or outside business hours. Lululemon, for example, regularly moves their racks of athletic clothing aside to hold in-store yoga classes. Besides being an innovative use of space, these special in-store events can also generate buzz about the brand or kick off the launch of a new product. Hotels are accustomed to selling meeting and banquet space, but properties that don’t have formal event space can still think outside the box and hold events in the lobby, in dining outlets, or even in guestrooms. And rather than selling the space to an outside organization, you can consider hosting free events that promote the hotel itself, such as a F&B tasting, spa open house, or career day that targets locals. Form partnerships with complementary brands Holding in-store events isn’t the only way brands are bringing innovation to their marketing strategies. Many retailers are collaborating with other brands that reach similar audiences or sell complementary products in an effort to generate publicity and offer unique products. One type of partnership involves a popular, value-oriented brand that joins forces with a luxury brand. Target, for example, sells affordably priced capsule collections with designers like Zac Posen, Lilly Pulitzer, and Proenza Schouler. H&M, another affordable retailer, has launched collections with couture brands like Balmain and Versace, offering their take on designer items at significantly lower prices. These collections often sell out quickly, which generates demand and publicity for the brand. But collaborations aren’t limited to the fashion industry. Home Depot recently teamed up with Pinterest to promote lighting, paint, textiles, bathroom fixtures, home decor products, and more in its “Shop the Look” program. In this program, consumers who are looking for DIY project inspiration on Pinterest can quickly find and purchase the items they need for the project at Home Depot. Hotels can engage complementary brands in similar partnerships, just like how Westin partnered with New Balance to offer sneakers and exercise clothing in its hotels. The key is collaborating with brands that resonate with your guests. If your hotel is well suited for families, perhaps consider partnering with a local toy shop to provide a selection of toys in some co-branded guestrooms. Or, if your hotel gets a lot of business from foodies, maybe collaborate with a local bakery on a tasty welcome amenity. Though the retail industry and the hotel industry have their differences, many of the most important business goals are shared: build brand loyalty, drive direct purchases or bookings, and stand out among a sea of competitors. Since both industries face some kind of internet-fueled disruption, hotels can take best practices from retailers who have found success in today’s dynamic marketplace. By learning from these creative retail tactics, hotels can gain traction online and book more rooms.
Here at Hotel Tech Report we get asked all the time about the most interesting technology trends and tools in the market. Everyone has a different reason to ask: Hotel owners want to know how they can run more profitable businesses Hotel workers want to know which skills will be valuable in the years to come Venture capitalists want to know which tech companies to invest in In a recent interview with Hotel Tech Report, Atomize CEO Alexander Edstrom shared an extremely compelling vision for the future of hotel software. Edstrom believes that well documented APIs are ushering in a new era of taylorism driven by more seamless vendor collaboration and consequently the potential for deeper specialization Within the revenue management software category, for example, Edstrom believes that systems will be bifurcated into two groups that serve very different needs and require very different skill sets: Strategic Revenue Management: Similar to traditional revenue management software, these systems will focus entirely on business intelligence and reporting. Tactical Revenue Management: Systems that focus entirely on optimization and real time pricing execution. If you’re about to have a nervous breakdown at the thought of another system to manage your hotel, don’t panic just yet because Edstrom’s vision has a slight twist. Instead of two separate systems, he believes that deeper collaboration and specialization will usher in a new era of white labelled solution so while it might be two different companies powering different aspects of the product, they would be bundled together into one interface. Edstrom believes that strategic revenue management software will continue to be the interface that helps hoteliers distill information and make better decisions but it will be powered by tactical revenue management systems that automatically run price optimizations in the background. This means that as a hotelier you might not even need to know the name of the company who powers #2. A simple analogue to illustrate this concept can be found in the automotive industry with Aston Martin’s supercar, the Vantage. Do you know who produces the Vantage’s 4.0 litre V8 twin-turbocharged engine? If you said Aston Martin, think again. The correct answer is Mercedes. By partnering with Mercedes, both Aston Martin and its customers benefit from Mercedes’ £10 million/day (€3bn/year) R&D spend that goes into developing its AMG twin turbo engines. Mercedes components allow Aston Martin to specialize in other aspects of the product like design, handling and production efficiency. In this example the Aston Martin is the strategic system providing an interface for the driver to navigate the road where the AMG engine is the tactical system that powers the vehicle but remains out of sight. To give you an idea why this type of collaborative partnership and specialization can benefit consumers all you have to do is look at Aston Martin’s annual revenue which in 2019 was less than 1/10th the size of Mercedes’ R&D budget alone. Instead of reinventing the wheel (pun intended) Aston Martin knew it could partner with Mercedes for the engine where they have invested billions of dollars, and instead invest their own R&D dollars on their core competencies of design and branding. "If somebody comes up with an innovation that adds value and is faster, better, cheaper, we take it," Murat Aksel, BMW SVP of Purchasing While the auto industry is an easy to understand example that illustrates a similar type of white labeling, there are dozens of other industries where this trend is happening too. Edstrom’s vision for the future is largely inspired by his experience in the world of ad tech where he and Atomize co-founder Leif Jagerbrand sold their company Admeta to global ad tech powerhouse WideOrbit. In ad tech, white labeling is considered table stakes. In this article we’ll explore how white label software will impact the future of hospitality. We’ll then dive into the reasons why revenue management systems are the software that’s most likely to get white labeled next. What is White Label Software? Have you ever heard of Twilio? It’s ok, most people haven’t. If you’ve ever gotten a text message from Uber or AirBnB - it was powered by Twilio. If you offer guest messaging services at your hotel, those too are likely powered by Twilio. Twilio is a $15B company that provides the building blocks (APIs) for software developers to create applications that leverage text messaging. Twilio may have been the first platform as a service company geared towards software developers but many have followed suit. Visa recently purchased fintech unicorn and platform as a service company Plaid for $5.3B. Plaid is the platform that popular tech companies use to connect with banking institutions and is responsible for critical functionality within apps like Venmo, Coinbase and Betterment. Both Plaid and Twilio are built for software developers which means that consumers rarely even know that the apps they use are powered by them. This enables software companies like Uber and Venmo to focus their energy and resources on its core competencies (e.g. distribution and network density) instead of building out redundant text messaging capabilities. This kind of white labeling has already begun in the hotel industry but without hoteliers even knowing it. Many of the property management systems that market channel management capabilities actually white label their channel managers from other vendors without the end user even knowing it’s another product. Edstrom believes that there will be a lot more white labeling like this to come and history is on his side. There are some taboos around “outing” white label software but this is actually the most innovative way to build tech ecosystems since it frees up vendors to focus R&D spend on new innovations while still providing a comprehensive product portfolio for clients. "Different degrees of white labeling software partnerships were, and still are, common in adtech. Today, many of the leading and known adtech "software providers" are actually offering products where the IPs (Intellectual Property Rights) belong to a variety of white labelled software providers. We can now see signs that this is starting to happen in the hotel tech industry as well in terms of different types of strategic partnerships, but also the fully cloaked, 100% white labelled partnerships, that the average citizen would never even know are taking place". Alexander Edstrom, CEO at Atomize In the context of the hotel industry, white labeling is an underrated alternative to the buzzy ‘app store’ concept. Both solve the same problem: allowing software companies to focus R&D efforts on actual innovation instead of wasting time and resources building redundant features and squabbling over distribution which ultimately hurts industry economics and confuses software buyers. App stores like Mews, protel and SiteMinder solve this problem by allowing users to tap the functionality of partner apps while white labeled solutions can potentially do this in a way that may actually be less confusing for the market (when executed well) since buyers need to work with fewer providers. Revenue Management Systems are Ripe for White Labeling Edstrom believes that the revenue management space is ripe for white labeling because it has evolved to solve two distinct problems each requiring different capabilities. Traditional revenue management systems (i.e. strategic) need to be good at reporting and data visualization which is a very different problem than price optimization (i.e. tactical revenue management). In order to understand how modern revenue management systems came to solve two distinct problems we need to understand a bit about the past. Before yield management took hold in the 80s and 90s, hotels relied on flat pricing (or at best seasonal fixed rates). The earliest applications of hotel revenue management began in the mid 1980s (back then it was called yield management). Since there was no such thing as a ‘revenue manager’ back then, this role was generally filled by reservation sales managers. The earliest applications of revenue management were pioneered in the airline industry to meet very rudimentary goals. For example, airlines would create fenced pricing such as discounts for booking a trip more than 21 days in advance. This began as yield management which generally refers to an inventory-centric price optimization approach. Over time these rules grew more complex and strategies became more sophisticated leading us to where we are today. As pricing and yield strategies improved there has been a concurrent rise of innovative revenue management software vendors that delivered tools to help revenue managers quickly test and implement new revenue maximization strategies by tapping competitive market and historical PMS data. Consequently, most revenue management systems today center around data dashboards and reporting tools. Drawing from experience, Edstrom believes that the next evolution of revenue management software will mirror what happened in the ad tech industry. He believes that while most revenue management systems today have focused on reporting functionality, the winning price optimization vendors of tomorrow will be white labeled utilities that work behind the scenes while hoteliers spend their time operating strategic revenue management and business intelligence software. Since price optimizations automatically happen in the backend, hoteliers don’t actually need to log in to that system. That’s why Edstrom believes that strategic revenue management systems and BI tools are better suited to act as the ‘hotelier facing’ software brands. If you think automated optimization sounds far-fetched, just take a look at digital marketing platforms like Google Ads that automatically optimize massive real time data sets to determine the right price of billions of ads every day. As an advertiser on Google, you pick your keywords then set a max bid (and budget) and the optimizations happen automatically in the background because there is no possible way for humans to analyze these massive datasets that are literally changing by the second. Tactical revenue management systems grow demand by decreasing prices in the same way that ad bidding platforms grow demand by increasing bids and budgets. The same way your hotel’s marketing team trusts that Google’s automated bidding system will maximize your marketing spend, Edstrom believes the new generation of tactical revenue management systems will serve as the pricing engine that optimizes your hotel’s pricing strategy on a minute-to-minute real time basis leveraging mounds of data that even Einstein couldn’t make sense of. By most estimates, only around 10-15% of hotels use revenue management systems today. Edstrom believes that the way to increase market utilization of such systems is to pull apart tactical price optimization tools and strategic revenue management software. What Automation Means for Revenue Managers The thought of fully automated tactical revenue management might sound scary to most revenue managers like the prospect of autonomous vehicles sounds to Uber drivers--but while driving skills may not be needed in decades to come, the analytical and strategic skills of revenue managers will be more in demand than ever before. There is no question of whether tactical revenue management will be automated according to Atomize CEO Alexander Edstrom and in many ways that world is already here. Edstrom told me a story about how he’d recently checked in with an important client whom he hadn’t spoken to in several months. The client owns a small chain of luxury boutique hotels in India and the conversation went something like this: Alexander: How is everything going with Atomize? Client: Actually, since we decided to go for Autopilot we have not had any reason to login into Atomize. I’m a bit embarrassed to say that I have even forgotten my login password. The numbers and KPIs look great, that’s all we care about. We don’t need to open the app to see specific prices set for certain room categories for future arrival dates as long as our RevPAR and occupancy rates are beating out the competition. Here at Hotel Tech Report we’ve written extensively about the day-to-day roles and responsibilities of revenue managers but these roles are changing at a rapid clip. It’s easy to see why revenue managers might feel threatened by an automated tactical revenue management system like Atomize; however, the reality is that systems like Atomize are actually freeing up commercial leaders in the hotel industry to focus on higher value tasks and strategic revenue management. Just as “revenue management” has built on the foundational concepts of “yield management”, the next iteration of this role continues to become even more strategic with each passing year. Revenue managers today have widely adopted the concept of total RevPAR (tRevPAR) and the leaders of tomorrow will increasingly be focused on not just tRevPAR but profit maximization through the implementation of actionable business intelligence. Revenue managers of the future will focus on commercial decision making like orchestrating the efforts of sales and marketing to maximize business profitability. In other words, revenue managers of yesterday focused on questions like “how much should I price this room for?” while revenue managers of tomorrow will likely focus on questions like “is it more profitable for me to drop rates by 10% or increase my PPC (pay-per-click) advertising budget by 20%?” -- The automation of tactical revenue management is already here and the best revenue managers are already leveraging this technology to save time and focus on the commercial skills necessary to stand out in tomorrow’s revenue management job market. This content was created collaboratively by Atomize and Hotel Tech Report.
Whether your hotel is a local landmark or a new kid on the block, it’s always a good idea to add fresh, new strategies to your hotel marketing plan. You may think that innovative ideas for hotels need months of planning and a budget that’s out of your reach, so let us assure you that you can implement creative marketing strategies in a short time frame and with little or no financial resources. In this article, we’ll share five marketing strategies for hotels and resorts that will attract new guests, drive direct bookings, and even strengthen guest loyalty. Best of all, these strategies are low cost and don’t require much planning. In fact, we recommend that you try one today! Which of our hotel marketing ideas will you try right now? Target repeat guests with personalized offers With so much attention given to acquiring new guests, it can be easy to forget about a valuable segment of traveler: your repeat guests. Why are repeat guests so valuable, you ask? Studies show that the acquisition cost for new guests can be between 5 and 7 times that of existing guests. Furthermore, “the probability of selling to a new customer hovers around a mere 5 to 20 percent. Meanwhile, the likelihood of selling to an existing customer is between 60 to 70 percent.” Essentially, guests who have stayed at your hotel are more likely than new guests to book, and a repeat guest’s booking costs less than that of a new guest. Give your loyal guests a little TLC with a personalized email that recognizes their loyalty. In the email, you want to make the guest feel special, so craft the message for your VIPs in a tone that sounds exclusive and appreciative. As the cherry on top, offer a special promo code or freebie that rewards the guest for their loyalty. Besides, your loyal guests can be your best salespeople, so treat them to a special offer that they’ll want to tell all their friends about. Give your employees a shout-out on social media Social media is a great way for hotels to stay connected with repeat guests and build brand awareness. But in addition to flattering shots of your pool, restaurant, and bathrooms, social media is also a fantastic channel for bragging about your hotel’s most valuable asset: your employees. After all, a memorable interaction with your staff is more likely to inspire a guest to return than your furniture is. For example, Hilton recently shared a video on Instagram about an employee’s journey from a refugee to an apprentice at Hilton Frankfurt City Centre. Besides just celebrating the employee’s story, the post received more views than any of Hilton’s other video content and over 28 times the average comment volume. Video content is certainly engaging, but you don’t need to produce a film like Hilton’s to get similar results. Grab your smartphone, walk into the lobby, and snap a photo of your front desk agents in action. Or start an “employee of the week (or month)” campaign that publicly recognizes team members for their hard work and dedication to your guests. Once potential guests learn about the exceptional service your staff provides, they’ll want to stay at your hotel. Partner with local businesses Wondering how to promote hotel sales among new segments of guests? Thinking outside of the box (in this case, your hotel is the box) can lead to some exciting and creative marketing ideas. If your hotel marketing plan seems stale, consider partnering with local businesses to host events, offer unique amenities, or collaborate on promotional offers that can reach new audiences. Joining forces with nearby businesses can allow your hotel to offer unique amenities that aren’t in-house. Do guests wish your hotel had a restaurant, a gym, or a spa? Rather than investing thousands of dollars in renovations, try investing a few hours in building a partnership with a restaurant, gym, or spa next door. For instance, the historic Lenox Hotel in Boston didn’t have the space for an on-site spa, so the property partnered with G20 Spa + Salon across the street. With the ability to offer spa services to its guests, the hotel is now a stronger competitor among luxury hotels in the area. Though the partnership might not materialize immediately, you can start brainstorming potentially local business partners and start the conversation today. Answer guest questions or comments with a personal touch Responding to guest reviews and social media comments can sometimes feel like a chore, but it’s important to remember that these responses provide an excellent opportunity to market your hotel. Rather than using canned responses or templates, answer each one individually, speaking to any specific questions or situations the guest mentioned - both positive and negative. Did a guest mention they loved the shampoo in the shower? Great! You can talk up your organic eucalyptus-scented toiletries that are thoughtfully presented in eco-friendly dispensers. Or was the guest disappointed in the food at your restaurant? Then you have the perfect opportunity to mention that your hotel has just hired a new chef who will be completely revamping the menu options (only if that’s true, of course). In addition to reviews, social media comments deserve personal treatment. RIU Hotels and Resort does an excellent job of responding to each and every comment personally. Even if the comment doesn’t have a question, the RIU team will say something like “thanks for your comment” or “we’d love to have you.” Their responses come across as genuine and thoughtful, which is probably exactly the impression that the brand wants to make. Another example of going above and beyond to respond to guest inquiries is when a child forgot their stuffed animal at a Ritz-Carlton hotel. The hotel found the lost toy, but instead of simply mailing it back to its rightful owner, the hotel took photos of the stuffed animal receiving the royal treatment at the hotel and included some Ritz-branded souvenirs in the box. The hotel also posted about the situation on social media, and the post went viral. As these examples show, innovative ideas for hotels to build online marketing power doesn’t need to be expensive or time-consuming. Try taking a few extra minutes to respond to guest comments today. Ask real people to test your website When was the last time you asked to watch someone book a room on your own website? If you answered, “never,” then today is a great day to perform an impromptu website audit. Ensuring your website is user-friendly and glitch-free is one of the most important pieces of your hotel marketing plan, because if your website has errors and guests can’t book easily, then all of your great marketing ideas are for nothing. To conduct these mini usability tests, go into your local coffee shop (or even ask your friends or family at home) and kindly ask patrons to book a room while you watch over their shoulders. As a hotelier, you might think the booking process is simple, but to someone who might only book a hotel room once per year, your website could be confusing. To get the most out of these tests, take detailed notes about your findings so you can make improvements to your site later. As your testers navigate through your site, you might notice their body language - do they tense up or show stress during any part of the booking process? - and whether they ask any questions. These are important observations that reveal pain points on your website. If you have some computer programming experience, perhaps you can resolve the issues on your own, but if not, then you’ll want to turn to an expert. Partnering with a digital marketing agency like D-Edge ensures your website is always in perfect working order. A digital marketing agency can help you not only maintain an intuitive, seamless website, but also source content and optimize your site for search engines. With a strong website, you can make progress toward your direct booking goals. -- With these five hotel marketing ideas, you don’t need to wait for budget season or hire a marketing department to make an impact. These simple, low-cost hotel marketing ideas are ready for you to implement today so you can reach new guests, keep loyal guests coming back, and book more rooms.
As a hotelier you obsess about the guest experience because you know it’s really all that differentiates your property from the hotel next door. You focus on design, amenities, staff training, the list goes on. But there’s one thing you’re likely to overlook. Digital signage can help your property deliver a five-star stay for every guest from the moment of arrival. Digital signage from vendors like Monscierge can do everything from displaying menus to providing map directions to printing boarding passes. Digital signs blend concierge curation and self-service in an easy-to-use, stylish menu that makes it easy for guests to enjoy their stay. Here’s how to best leverage digital signage at your property. You only have 27 seconds to make a first impression and that impression will inform the rest of that guest’s experience on property. A great first impression can create a halo effect on the entire experience. The Palm Jumeirah has a 24-hour arrival lounge for guests and Aria Las Vegas offers a similar experience for VIP check-in. Not every hotel has the space or resources to invest in these kinds of experiences but digital signage kiosks, digital displays and video walls are a cost effective way to differentiate the customer experience at your hotel no matter the chain scale and it’s incredibly easy to implement. At it's core, digital signage must be interactive, provide guests with real-time information and have a robust yet easy to use content management system. With cutting-edge solutions, your guests should easily be able to interact with digital signage screens and your staff should be able to easily update content. Once you've found a solution that meets your digital signage needs, here are some ways that you can maximize impact. 1. Expedite Check-in Check-in is a make-or-break moment for many properties: a bad check-in experience leads to negative reviews that can be hard to recover from. Digital signs smooth out the check-in process by offering auto check-in or by helping guests find the information they need without having to monopolize the attention of your front desk team. Many digital signage solutions offer automated or self-check-in. Guests can operate the touch screen to check-in, drop their bags, and go off to explore. This takes some of the pressure off your front desk team at peak transition times. Solutions that don’t have self-check-in still help reduce wait times. Guests can resolve questions themselves without waiting in line to ask the front desk, thereby shortening wait times for those checking in. One case study from Monscierge’s digital signage software claims to have cut down front desk wait times by 20% or more. “It is an effective way to communicate with guests, and the lobby touch screen is useful for providing guests with a self-serve information point, which has more information than we have time to cover in a standard check-in too,” writes one Hotel Tech Report reviewer says of Connect Signage. 2. Curate Local Experiences Your concierge faces a similar challenge as your front desk staff: during peak hours, they are often overwhelmed with requests for tour bookings, restaurant recommendations, wayfinding directions, and more. Digital signage can alleviate some of the pressure on your concierge by delivering personalized travel recommendations at the touch of a button. Monscierge reports that amongst digital signage content weather and maps are two of the most popular menu items guests choose to interact with; local recommendations drive almost 70% interactions. Interactive digital signage improves the user experience by enabling guests to choose their own adventure and learn more about the digital content that's most relevant for them. Set up your digital signage to highlight bookable tour operators, sightseeing highlights, and restaurant recommendations that guests frequently ask for. 3. Master Social Marketing Hotels have long benefitted from visual marketing on platforms like Instagram and Facebook. Digital signage platforms offer a new tool for guests to share their experiences. Use social postcards to upload images from your property or your location. Guests can customize and send digital postcards through the interactive menu using social media or email. It’s a fun, authentic way to organically promote your property and destination with little to no marketing overhead. 4. Manage Events Easily Digital signage can help streamline event management and keep attendees from getting lost and confused. Add signage outside event rooms, conference rooms, and throughout the property to help guests find their next lecture or meeting room. Add venue names and event descriptions to help the event stay on-schedule. Customize welcome messages, provide directions, and provide WiFi access to attendees to prevent the front desk from being overwhelmed. Digital signage tech like that from Monscierge is specifically designed to make hosting a conference easy with features that integrate with your existing event systems and a centralized content management platform with plenty of advertising opportunities. 5. Promote Ancillary Services Digital signage provides a way for guests to discover new features at your property via digital menu boards that highlight amenities. Highlight ancillary services with video, high-res images, and guest testimonials. Run promotions through your digital signage that guests can book directly through the interactive screen. You can also offer a new avenue for guests to sign up for your rewards program by unobtrusively promoting the program in the touchscreen menu. Create your own recommendations for guests to explore all the amenities available at your property. 6. Open a New Marketing Channel Seeking a new revenue stream? Add revenue to your budget by turning your digital signage into an advertising channel. Interactive displays offer a way to work with local businesses for sponsored recommendations or specific campaigns. In addition to up-selling items at your property, you can display rotating advertisements using Monscierge’s Connect CMS management tool. “Pairing super useful content alongside advertising will mean that viewers don’t feel like they’re being bombarded. At the same time, advertisers receive high returns on view rates,” writes one digital signage expert. 7. Provide Travel and Emergency Information In the event of an emergency, your screens can be used to disseminate information quickly. Update digital signage throughout the property to tell guests where they should go, what they need to do, and updates as the situation progresses. Likewise, in the event of a global event that might interrupt travel plans – Coronavirus, for instance – keep guests apprised of flight cancellations or delays at the airport. Digital signs are useful even if there’s bad weather in the area causing flight delays. Make sure to find a solution that guests can understand: Monscierge provides more than 26+ languages available automatically. 8. Upgrade Your Lobby Decor Digital signage provides tons of services, but it’s also great decor. When not in use, set your digital screens can play a YouTube playlist, local news station, or travel blog. Depending on where you set up your screen, you may add a specific looping video: outside the spa, for instance, you can show a video of a tranquil waterfall or running water. Set the display to sports highlights where people are waiting for a seat at your restaurant. Digital signage is valuable real estate: the worst thing you can do is leave the screen blank.
2019 was a big year for hotel news and the hospitality industry as a whole. From OYO’s aggressive global expansion to Google’s full-fledged hotel search product, there were some significant stories unfolding around the world. Given the recent coronavirus scare originating from China, it can be hard to remember that while times like these are extremely painful for our industry - they are still temporary. The impact of covid-19 on hotel groups, airlines and cruises around the world has been devastating as evidenced by the STR hotel stock index falling more than 30% in the last 30 days. During the media frenzy around the virus, we wanted to take a step back and reflect on the biggest news stories of last year which we believe will have a long term impact on our industry. To put these developments into perspective, we’ve combed through the archives and picked out what we think are the most impactful hotel news stories of last year. To make the cut, we looked for stories that resonated far beyond the news itself. Stories that reflected trends, revealed truths, and highlighted evolving dynamics and the industry’s trajectory in the years ahead. So what do these top stories mean for you? Read on to find out what makes each story important, why you should care, and understand the long term implications for the hotel industry. In no particular order, here are the top 10 biggest hotel news stories of 2019. We'll be watching throughout the year to see how these stories set the scene for this year’s wave of major hotel news stories. #1: Google Puts (More) Pressure on TripAdvisor and the OTAs In 2019, Google’s full ambitions came into focus: the company released its full-featured hotel search product, Google Hotel Search. This was huge news because it was an entirely new metasearch channel for hotels to leverage. It also put competitive pressure on the major OTAs. Then, later in the year, Google then put all of its travel products into a single interface, further challenging the OTAs’ core brand proposition as a “one stop shop” for all things travel. And it’s working: Google Hotels and Flights had 674 million visits in 2019 compared with Expedia’s 360 million, Booking’s 333 million and Tripadvisor’s 207 million. What makes this such a big story? Google is the dominant global search engine. As a monopoly, it exerts immense leverage over the attention of millions of consumers. The fact that it’s going head-to-head with its major advertisers in travel means puts it in direct conflict with not just those advertisers but also with regulators investigating Google’s monopoly on search. What is the overarching trend behind the story? Disintermediation can come from anywhere -- and there’s no such thing as a static digital marketing channel. Frenemies are a standard facet in the travel industry, but what happens when a frenemy simply becomes an enemy? Why should every hotelier care about this? Existential threats to the OTAs is a good thing for hoteliers. It puts competitive pressure on the duopoly to provide better terms, improve their products, and generally be more responsive to hoteliers’ needs. What are the implications for the hotel market? This is a fundamental reshuffling of the competitive core of the hotel industry. Hotels now have another marketing channel to leverage and that means that there’s a new way to engage consumers and potentially reduce reliance on commision-based intermediaries. However, there’s also the chance that Google’s dominant position will simply add another formidable force to the equation. As that translates into bookings, Google will exert (even) more power over the industry and raise rates for Hotel Ads. #2: SiteMinder Became a Hotel Tech Unicorn At the tail end of 2019, rumors began that Siteminder’s latest round would value it at AUD $1.1 billion. The AUD 100 million round, which closed in early January of this year, indeed pushed the company into unicorn territory -- a rare feat in travel tech, where there are around 34 unicorns out of a global total of 400, per CB Insights. This milestone was reached amidst the backdrop of record-breaking levels of Investments and travel and Hospitality startups: USD 5.7 billion in 2018 and over USD 6 billion in 2019. What makes this such a big story? Unicorn status confers momentum, legitimacy and a sense of inevitability on a startup. Yet there really aren't that many travel tech unicorns (let alone hotel tech); it's a tough industry to break into and get to sufficient scale, so the fact that SiteMinder got there is a story in and of itself. Hotels are about 10 years behind but we are entering the era of SaaS and APIs - we anticipate a slew of new hotel tech unicorns to follow. What is the overarching trend behind the story? Hospitality technology is increasingly seen as a promising sector by investors, who like the margins and resilience of a B2B play. In 2019, hotels also planned to increase their own technology budgets by 54%, with only 8% decreasing. With a growing market, well-funded startups like SiteMinder, with both traction and a global operations, are ideally positioned to thrive. Why should every hotelier care about what’s happening here? As more funds flow to the sector, hotels can expect greater innovation, better pricing, and more choice from their vendors. When companies reach unicorn status, hotels must also learn to shift their thinking and stay up to date with the latest tech. What are the implications for the hotel market? Higher valuations entice new entrants. And more competition is always a good thing for an industry that often sees competitiveness threatened as power is consolidated into fewer and fewer hands. Another thing: as more technology innovations become available, hotels of all sizes will feel greater pressure to adopt technology to compete effectively. #3: CoStar Acquired STR STR has long enjoyed its central status among hoteliers worldwide. Its STR reports (known as star reports) have been benchmarking industry trends for decades. Its companion news site, Hotel News Now, is also a prominent industry resource. This well-groomed reputation led it to be acquired for a whopping USD 450 million in cash by CoStar Group, a real estate data and analytics firm. What makes this such a big story? It's not often that a major industry resource, used globally by nearly every hotel, changes hands. What is the overarching trend behind the story? The multiple was a big part of the story: STR earned USD 16 million of profit from USD 64 million in revenue in 2019. With a purchase price of USD 450 million, that’s a significant multiple on earnings. There’s clearly extraordinary value of hospitality data and analytics -- especially in an environment where the next biggest competitor has a single digit share of the market. Why should every hotelier care about what’s happening here? This tie-up could be especially helpful for hoteliers looking to understand the dynamics of hospitality real estate within the context of other retail and office buildings within a market. These insights could reshape how STR products are used by hotels. STR will also be better positioned in Asia, where its saturation is only one-fifth of that in the U.S. What are the implications for the hotel market? There was the typical hand-wringing and fretting over the impact of the acquisition. While it's too soon to tell what this means for the hotel market, it's hard to imagine that the new owners would quash something so integral to the industry. And it seems like a good fit, as the two brands clearly align on providing actionable data to specific industry segments. #4: Aimbridge and Interstate Hospitality Merged Aimbridge, North America's largest independent hotel management firm, merged with and Interstate Hotels & Resorts, an independent multinational hotel operator. Together, the new entity became a global force in third-party hotel management services, with a combined portfolio of over 1,400 branded and independent properties in 49 U.S. states and 20 countries worldwide. What makes this such a big story? Mergers like this don’t come around every day: The deal formed a major global contender in the hotel management space, which employs 60,000 people worldwide. What is the overarching trend behind the story? The Aimbridge and Interstate Hospitality tie-up was the the first of two big mergers of the year, both of which created major new players In their respective segments. It's another example of rising pressures on firms to maintain competitiveness through consolidation. Why should every hotelier care about what’s happening here? Any time two medium-sized players combine to create a much larger competitor, it changes the dynamics. Other hotel operators must pay attention to see how the combined entity manages to deliver benefits from its newly scaled and global platform, as well as how the larger team competes more effectively for business in both existing and new markets. What are the implications for the hotel market? The larger hotel operator can leverage its size to attract even better talent, provide more services, and deliver more value to hotel owners. At the very least, it's another option for asset owners looking for an operator with global scope. #5: Eldorado Merged with Caesars In one of the biggest hospitality deals in recent memory, Eldorado merged with Caesars. In fact, it was Eldorado Resorts that bought Caesars Entertainment, which had been struggling under a mountain of debt. Another notable element of this deal was that it was backed by activist investor Carl Icahn, who is known for shaking up underperforming businesses. What makes this such a big story? The USD 8.6 billion price tag (plus nearly USD 9 billion in debt) certainly got the world’s attention! And the merger also created the largest owner and operator of gaming assets in the United States, which is a major re-centering of industry dynamics. Icahn called this deal “transformational. What is the overarching trend behind the story? A key trend at play is private equity, which bought Caesars in a leveraged buyout in 2008 and left it with that mountain of debt that pushed it towards consolidation as a strategic move to maintain competitiveness. Since the newly-enlarged entity can leverage greater strategic, financial, and operational advantages, the economies of scale favor larger operators and encourage further consolidation. The cycle continues! Why should every hotelier care about what’s happening here? Any hotel that has exposure to markets in which Caesars and Eldorado compete will face stiffer competition from the larger entity. And since the combined company has 60 casino-resorts across 16 states, the impact will be felt far and wide. What are the implications for the hotel market? As gaming companies become gaming, hospitality, and entertainment conglomerates, it reshapes expectations from several stakeholders: hotel guests, loyal gamers, investors, and employees all have different perceptions of these larger entities. #6: IHG Acquired Six Senses In early 2019, IHG further expanded its footprint in the luxury segment by acquiring Six Senses for $300 million in cash. The move came on the heels of a 51% majority stake in Regent International, and follows the major Kimpton acquisition back in 2015. This further consolidates IHG’s perception as a luxury brand focused on wellness, health and sustainability. What makes this such a big story? Since acquiring Kimpton IHG has undergone a total luxury makeover. It's successfully acquired its way to becoming one of the top luxury portfolios with properties focused on different subsets of high-end travelers. What is the overarching trend behind the story? There are three trends at play here: continued consolidation of brands under IHG, Marriott and Hilton; the expansive impact of private equity in buying and flipping businesses; and the increasing focus on the luxury traveler. Why should every hotelier care about what’s happening here? Of those three trends above, the growing focus on the high-end of the market. For years the global economy has experienced what we call a “band stretch” where ultra luxury like Six Senses and ultra economy like OYO (more on that below) have both experienced massive growth but undifferentiated and generic products that deliver questionable value in the middle get squeezed out of existence. This will continue to put pressure on both independent and branded economy/midscale properties (especially because of their rapid expansion in the last two decades and what we at Hotel Tech Report believe is a massive oversupply). What are the implications for the hotel market? The USD 60 billion dollar luxury market is alive and well! Hospitality brands that served that segment have proven to be very popular with the developers, investors and asset owners. Landing management contracts thus requires brands that appeal to these investors and most see luxury brands as great investments. #7: The Rise and Fall of OYO Rooms OYO’s bold global ambitions, coupled with a 20-something founder, was an irresistible story for both mainstream media, hospitality trades, and conference organizers. Yet, amidst this massive global expansion, OYO reported a $355 million loss in 2019 -- more than six times its $52 million loss in 2018. The media began correlating the ballooning losses at the Vision Fund-backed company with the implosion of WeWork, another Vision Fund investment. What makes this such a big story? OYO’s $10 billion valuation puts it in the big leagues, valued at double Wyndham Hotel’s market capitalization. The sheer scale, scope, and level of investment makes this a major storyline industry-wide and with mainstream media. What is the overarching trend behind the story? OYO appears to be another example of a “disruptive” startup coming into a “legacy” industry and facing a wall of challenges that threaten its very existence. These challenges include self-inflicted wounds resulting from a superficial understanding of industry dynamics and hyper-growth over proper fundamentals. Why should every hotelier care about what’s happening here? It’s a juicy story! Beyond that drama, OYO now handles 43,000 hotel rooms worldwide. They’re a global contender that can reshape local markets wherever they enter. For example, by empowering independent hotels with modern design and technology, they become more competitive against other local properties. But beware: not all owners are happy with OYO’s business practices. What are the implications for the hotel market? OYO’s business model is noteworthy by its uniqueness: for a percentage of revenue that’s lower than typical franchising fees, it offers budget properties standardized design, modern technology and other services. Up to this point, independent owners of hotels and motels had no options outside of franchising, which is an expensive investment. If OYO does implode, there could be serious damage done to independents left without promised support. #8: Plastics Got Banned and Flights Got Shamed Rising awareness of the immense impact of plastics on our environment (90% ends up as trash) has led many hotels to accelerate sustainability efforts. Local governments further accelerated these efforts by banning plastics altogether, including several in the U.S. that also banned single-use toiletries at hotels. “Flight shame” also became a thing this year. as more travelers came to terms with the fact that aviation is a major contributor of carbon emissions. To mitigate that impact, many travelers pledged to eliminate or reduce air travel, which has led to dipping aviation demand in certain countries. What makes this such a big story? Images of the Great Pacific Garbage Patch have unleashed a new wave of awareness around the impact of plastics on the world. And climate activists have captured worldwide imagination with global walkouts and major demands on reducing global emissions. What is the overarching trend behind the story? The climate crisis has put sustainability at the forefront of global consciousness. It's no longer possible to ignore the likely industry-wide disruptions caused by climate change. Why should every hotelier care about what’s happening here? With movements like flight shame reaching across cultures, more consumers seek sustainable options when traveling. While it's harder to stop flying, it's easier to stay with hotel brands that put that sustainability ethos front and center. Hotels may be unevenly pressured to help travelers reduce/offset carbon emissions while in-destination, since they can't easily cut out flights. What are the implications for the hotel market? Plastic bans and flight shame affect Two major parts of the hotel business: operations and demand. As Travelers expect more sustainability from their lodging, hotels will have to invest in upgrading properties and providing sustainable amenities and operations. And any reductions and flights means fewer potential guests. #9: AirBnB Acquired Hotel Tonight Airbnb closed its acquisition of Hotel Tonight in April of 2019. Prior to HotelTonight, Airbnb had already expanded into in-destination activities, restaurant reservations and luxury vacation homes. The purchase was the first major move to expand its foothold into hotels and add more diversity of supply to its offering. What makes this such a big story? At an estimated USD 400 million, this was Airbnb’s largest acquisition to date, which on its own is newsworthy. But in the context of Airbnb's always-rumored “imminent” IPO, this became even more newsworthy because it signaled Airbnb’s ambitions to expand beyond hosted homes and vacation rentals to further “professionalize” its supply before going public. What is the overarching trend behind the story? Expedia and Booking are up against Airbnb and Google as the titans vie for supremacy in an all out battle to become an “end-to-end” travel platform. HotelTonight was also mobile-first and mostly last-minute, which provided a major leg up for Airbnb to boost its own mobile and last-minute bookings, which are a growing global trend. Why should every hotelier care about what’s happening here? Airbnb's push to become more of an OTA-like platform gives hotels a new distribution channel. As the company becomes more sophisticated with its advertising business, there will also be new revenue/marketing opportunities. Hoteliers must keep a close eye on developments here to stay on top of Airbnb as a reliable and affordable source of demand. What are the implications for the hotel market? Airbnb has obviously been a major challenge to the traditional hotel business. It captures a significant chunk of travel demand and this will only increase as Travelers learned that they can start their searches on Airbnb rather than Google or an OTA. Even so, greater competition among intermediaries is good for everyone. As these major players battle for supply, hotels will have more leverage to negotiate better terms. #10: Thomas Cook Collapsed Last but definitely not least was the extraordinary collapse of UK-based Thomas Cook. As one of the oldest travel brands in the world, it was nearly unfathomable that a brand with such heritage could tumble so quickly. And it happened in an environment that was actually expanding: in 2018, 60% of the British population took a holiday abroad, up 3% from the year before. Even as the brand struggled to regain its footing over the past few years, the collapse took many by surprise and became a major story affecting travelers across the globe. What makes this such a big story? The visuals were stark: passengers stranded around the world, employees without information, local subsidiaries left in the dark. It was one of those catastrophic train wrecks that no one could look away from. What is the overarching trend behind the story? In addition to a poorly managed merger and excessive debt, Thomas Cook failed to navigate a changing industry. Namely, it didn’t adapt well to the internet, continuing to rely on expensive storefronts under-investing and its digital presence. Thomas Cook became a classic case study of a once-formidable company that failed to adapt as the world changed around it. Why should every hotelier care about what’s happening here? First, there’s the lesson around crisis planning: you must be prepared to have a plan for every contingency. Second, there's the lesson about relying too much on a single demand channel. In some countries popular with summer vacationers, such as Greece, Spain and Turkey, Thomas Cook accounted for over 25% of their business. Many other destinations relied on the brand for double-digit percentages of demand. Whenever you start to see a single non-direct channel dominate your channel mix, it's time to consider tweaks to your mix. At the very least, make a contingency plan in case of an unexpected drop in that demand. What are the implications for the hotel market? The global industry lost a major source of bookings. It will need to work diligently to recapture that demand and maintain existing relationships between individual destinations and their loyal travelers. The collapse also highlighted the fact that proper technology is essential for maintaining competitiveness in a global marketplace.