Imagine knowing your guests’ exact accommodation wishes before they arrive. This sounds like a dream quite close to reality for many hoteliers, but it’s still unattainable.
Business intelligence (BI) is one such solution that helps hoteliers with data analysis of guest preferences and market trends. Most importantly, it unites with your existing systems while caring about your budget simultaneously.
In this article, we’ll explain business intelligence for hotels and the benefits of its implementation in detail.
What Is Hotel Business Intelligence?
Hotel business intelligence aims to give hoteliers insights into guest experience so they can enhance their strategies. It gathers data from various sources to enable fast and smart decision-making.
Hoteliers analyze data from online booking engines, reservation systems, and digital marketing platforms through BI data mining strategies. Based on this data, they can predict exactly what their guests want regarding accommodation and amenities.
BI also contributes to smart revenue reporting and analysis. It reviews key performance indicators, such as occupancy and daily room rates, to detect areas for improvement. By tracking these performance metrics, you can anticipate future guest preferences and tailor their services accordingly.
Why Hotels Need Business Intelligence Tools?
Hotels need business intelligence tools to improve their business performance and strategic planning. BI software platforms integrate technology solutions for financial management, accommodation rate optimization, and inventory management.
For more details, check out the subsections below.
Streamline Decision-Making Within Teams
BI enhances hotel operations by providing insights that help hotel staff calculate occupancy rates and perform bookings management.
The data integration results in:
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Real-time monitoring: Hoteliers can access real-time data about guest preferences, enabling smarter customer relationship management (CRM).
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Market segmentation: Based on the customer data analysis from BI, hoteliers can adjust their marketing strategies to attract guests.
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Collaboration and transparency: BI streamlines different data sources to enable seamless collaboration between your staff for business efficiency improvements.
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Predictive analytics: Hoteliers predict future guest preferences based on the previous return on investment analysis and market conditions monitoring.
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Dynamic pricing: BI enables scalable and accurate pricing strategies in hotel management systems.
Operational Efficiency
By streamlining operational processes, BI helps hoteliers allocate resources to produce more happy guests. As a result, you can maximize revenue because it manages workforce schedules for your staff.
You can easily synchronize their database management systems with cost management efforts to avoid unnecessary spending. Plus, guest data analysis enables hotel staff to have more control over daily task planning.
BI is highly customizable and reliable for efficient team performance analysis and stakeholder reporting on operational efficiency. It improves operational efficiency and informs strategic planning teams on its analysis to maximize collaboration.
Trend Identification
BI software integration capabilities allow customer segmentation across multiple criteria:
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Guest preferences and behavior
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Travel and booking habits
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Pricing trends
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User-friendly booking process
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Secure payment options
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Economic indicators
Hoteliers develop flexible accommodation solutions by analyzing these trends within automated BI software. It identifies booking patterns and tailors marketing campaigns. As the customer demand forecasting changes, your BI strategies evolve and attract new guest types.
Competitive Analysis
BI helps hoteliers benchmark competitively and create occupancy strategies by analyzing competitors' market performance. It guides staff on necessary updates, supports decision-making, and enhances customer satisfaction.
Again, BI provides data-driven insights and analyzes guest behavior. As a result, the software predicts future trends and personalizes guest experiences. With competitive analysis, hoteliers position their hotels as worthy competitors in the market.
So, hotel managers can target specific demographics by displaying amenities and additional services to differentiate themselves from other market players.
Key Components of Hotel Business Intelligence
Hotel BI contains crucial components that help hoteliers track market trends on guest behavior and habits. Take a look at each BI component below to learn more about them in detail.
Data Collection
BI examines large amounts of guest data to verify your decision-making strategies. It applies detailed statistical analysis to check changes in customer preferences. This valuable insight helps hoteliers take appropriate action and adjust their strategy.
We differentiate three types of data collected through BI channels:
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Hotel performance data: BI gathers data about hotel operations, occupancy trends, and revenue changes.
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Market data: Hoteliers can determine their position against competitors by comparing historical, real-time, and forecasted data.
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Guest data: BI reviews guest information by criteria such as demographics, preferred contact method, and loyalty status.
Data Analysis
BI transforms gathered data into sustainable insights that help hoteliers make informed decisions to improve guest experiences. This data comes from various sources, including customer surveys, marketing campaigns, and targeted market analysis.
Check out the most helpful data analysis methods below:
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Descriptive analysis: Historical and current data shows the hotel’s market performance by analyzing booking trends.
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Predictive analysis: Based on the guests’ previous habits and behaviors, BI forecasts future trends in booking demand.
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Sentiment analysis: The data gathered from surveys, guest reviews, and social media mentions shows guests' experiences with your hotel.
Reporting and Visualization
Data reporting tools compile and organize data that BI software continuously gathers about guest habits. It helps in strategy building for hoteliers. This significantly enhances customer experience and eventually improves customer loyalty.
BI Tools that Help Visualize Hotel Performance Data
Data visualization transforms various types of gathered data into readable and valuable insights. This process optimizes room rates and enables strategic pricing for hoteliers.
Here are explanations of the most popular tools for data visualization in hotel BI.
Reservation Behavior
Guests get their first impression of your hotel’s service when they attempt to reserve their stay. To accommodate future customers, hoteliers implement multi-channel booking platforms.
BI software segments customers based on demographics, room types, and frequency of stays. Based on this data, hoteliers can create specific promotions and special offers to reward customers’ loyalty.
Financial and Accounting Data
BI gathers and reviews financial and accounting hotel data to ensure steady revenue growth. It finds new ways of optimizing spending and minimizing costs while maintaining impeccable service.
The software tracks spending and money flows to present hoteliers with detailed financial reports. Based on these insights, hoteliers can optimize their spending. Simultaneously, they can ensure that the service remains high-quality and attractive to guests.
Revenue Management Metrics
BI utilizes revenue management metrics to introduce dynamic pricing and improve hotel occupancy strategies. The most common metrics are:
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Occupancy Rate: The percentage of occupied rooms at any given period.
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Average Length of Stay (ALOS): The average longevity of guests’ stays.
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Average Daily Rate (ADR): The revenue based on the number of occupied rooms.
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Revenue Per Available Room (RevPAR): Revenue based on occupancy and performance.
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Total Revenue Per Available Room (TrevPAR): Revenue from all sources divided by available rooms.
Marketing Data
Analyzing marketing data gives a deeper insight into customer behaviors when searching for and booking accommodations. The analysis enables marketing teams to develop new and attractive promotional campaigns and strategies for targeting customers.
Marketing data also gives hoteliers valuable insights into competitor strategies and behavior. BI analyzes the market trends your competitors follow and their success with them. Based on this data, the software recommends your best action to stay ahead.
Operational Data
BI gathers operational data to help your staff manage daily operations easily and provide enjoyable service to guests. The most valuable operational data metrics are:
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Real-time monitoring
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KPI tracking
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Budget forecasting
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Feedback analysis
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Departmental insights
Guest Data
Guest data shows customers' behavioral patterns when booking and staying at your hotel. This data spans from analyzing booking options to staying at your hotel and utilizing its services. These insights greatly benefit your hotel staff.
They enable hoteliers to anticipate guests’ needs and provide special offers based on previously gathered data. Guest data enables more personalized communication between staff and guests.
How To Choose the Right Hotel Business Intelligence Tools
Finding the right hotel business intelligence software for your hotel can be a challenging journey. Here is how to choose BI wisely and start optimizing your business immediately:
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Define business goals
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Prioritize simple navigation
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Check integration requirements
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Keep costs in mind
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Analyze user reviews
Thinking about purchasing business intelligence software? Check out our suggestions in this buyer's guide!
Key Takeaways
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Hoteliers benefit from business intelligence software by gaining insights into customer behavior and preferences.
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BI software provides real-time tracking, gathering, and analysis of valuable customer information.
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The goal of a hotel BI is to help hoteliers build new strategies for improving their services.
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Choose the most suitable BI solution based on your hotel’s budget, target audience, and integration capabilities.
Frequently Asked Questions
Can Small Hotels Benefit From Business Intelligence?
Yes, small hotels can benefit from business intelligence. BI tools help improve operational efficiency and guest experience regardless of hotel size. By implementing BI software, small hotels can compete against bigger establishments in attracting guests.
What Types of Data Are Most Valuable for Hotel Business Intelligence?
The most valuable hotel business intelligence data are operational, guest, and revenue data. Operational data helps hotel staff to manage daily operations and provide a quality service. Guest data shows customer preferences regarding their stays. Lastly, revenue data shows the effects of BI strategies on your hotel’s profit.
Is Hotel Business Intelligence Expensive?
No, hotel business intelligence is not expensive. Hotels need to adjust their search for hotel BI based on their budgets. This approach prevents wasting resources and higher initial investments into setting up a BI solution.