As part of HOTELS’ 50th anniversary issue, the editors spoke to leaders in the technology space to chronicle their opinions on trends to watch, threats to business, what hoteliers might be ignoring at their peril and, conversely, what might be a misguided trend.
HOTELS: What is the biggest threat to the hotel industry and why?
David Atkins, principal, Digital DNA Infusion, Miami, Florida: Resisting disruption and not embracing new competitors and intermediators. What is happening across the digital landscape is just the tip of the iceberg. Gone are the days when brands and hoteliers can own all of the end user’s information or think that a loyalty program is a long-term answer. There is enormous power to be unlocked by running web services that help brands reach potential guests wherever they are, and whatever mode they operate in. Beyond the OTAs and TripAdvisor, how are you tracking customers across Facebook, Google, Uber, Airbnb, Adobe, Twitter, Snapchat and other platforms? Seek external opinions to challenge your thinking, and do it quarterly.
Michele Dupré, group vice president, Verizon Enterprise Solutions’ Retail and Hospitality practice, Chicago: The requirement and expectation that hoteliers will provide a consistently high level of physical and digital information security to guests—and do it all cost-effectively. Providing effective digital security requires leveraging cloud-based protection technology across all owner-operated facilities, as well as increasing secure Internet-of-Things designing and planning for security requirements early in the process. Partnering with reputable security organizations for expedited threat analysis, along with a forensic investigative response to contain any potential breaches that could harm their guests and their brand, is essential.
Loren Gray, founder and CEO, Hospitality Digital Marketing, Dallas: Commoditization. In all facets of the digital marketing landscape, we are on rented land. Whether it be Google, Facebook or other platforms, they are, at their core, not ours to control. We also are losing our direct identity to others selling our product to our guests—the OTAs, the metasearch channels, and yes, even Google. Just ask Siri.
H: What is the industry ignoring at its peril?
Atkins: For owners, asset managers and brands, it is the level and frequency of investment in their digital platforms and revisions to the strategies that underpin these decisions. There is a notion within the industry that technology platform investments are run on a “set it and forget it,” three-, five- or 10-year investment cycle. To remain competitive today requires incredible speed to market, flexibility and a consumer-centric approach that gives potential guests control over their entire experience. This is what guests expect from brands. Content is king, context is queen and technology is an enabler.
Dupré: Critical cybersecurity risks around the safeguarding of digital communications and transactions with guests. Underscored by a recent series of high-profile breaches, there is an urgent need for more careful treatment of sensitive customer information, which is increasingly being shared digitally to automate the guest experience, enhance loyalty and set new comfort norms. Verizon’s 2016 Data Breach Investigations Report identified point-of-sale intrusion as the culprit for 74% of the data breaches tied to the hospitality sector during the previous year. It appears that following a series of high-profile cyber attacks directed at retailers, the spotlight has turned to the hospitality industry, a threat that should be taken seriously.
H: Name a misguided industry trend. What needs to change?
Gray: The lack of proper accounting as it relates to channel cost. Because we account for the cost of OTAs as a “non-line item” in our P&Ls, we will instead cancel a wildly successful, highly converting direct channel campaign for lack of budget funds and let run unbridled OTA bookings simply because no one is being held accountable for the profitability of contributing channels. Look less at RevPAR and more at ProPAR.
H: What is one trend you are watching and why?
Atkins: I am bullish on the use of computer-assisted interaction with a mix of content and context. This technology will revolutionize the travel experience, and it is not some sci-fi fantasy. There are practical applications coming every day. Every owner, asset manager and brand should be asking their partners how they can help build strong brand differentiation using these new platforms—such as artificial intelligence in the booking path to increase operational efficiencies; augmented reality to heighten marketing differentiation and on-premise experiences; and even virtual reality and gamification to increase awareness, post-stay engagement or to provide a unique destination marketing experience.
Gray: Voice search. As recent as the past few months, dramatic changes in accessing development of things, like Google’s new Assistant, Apple’s Siri, Amazon’s Alexa and Microsoft’s Cortana will redefine our interaction with search and use of personalization. If we don’t start expanding our ability to create unique relationships with our current guests, we will lose the future ability to influence their awareness of our product.
David Sjolander, chief operating officer, HTNG, Schaumburg, Illinois: Mobile keys. It is difficult to change guest behavior. Guests are programmed to walk through the door, go to the front desk and proceed to their room after collecting their key and room assignment. For mobile keys to have a chance, they will need to be widely deployed and become top of mind for travelers. As a comparison, if online check-in only worked with some airlines and then only at some airports, it would be used very little. And there’s the perception of security. Guests will need to feel comfortable that only their phone will open the door, not any phone.