How cloud, big data and AI can help hospitality business
Studying spending trends, competitor pricing, average market revenue per available room and other metrics allow revenue managers to take better pricing decisions
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Cloud computing technology has reshaped the landscape of hospitality. In an industry once dominated by wealthy international chains, the cloud has levelled the playing field. Today, independent properties have access to the same powerful management tools that were once only within reach of the evolved brands. Not only has the cloud enabled properties around the world to enter and compete in global markets, it is also helping them lower management expenses and increase operational efficiency.
Today, the question is no longer whether hoteliers should adopt the cloud, but rather how the platform can help hotels improve various aspects of running their business. Cloud-based services are rapidly displacing conventional systems at all levels, from consumer to management. Software-as-a-service (SaaS), infrastructure-as-a-service (IaaS), and platform-as-a-service (PaaS) are becoming increasingly popular subscription choices for a number of businesses.
Awareness about big data is growing fast as more hotels begin to see the merits of uncovering patterns in hospitality trends, thereby enabling them to personalize the guest experience better and build brand loyalty. Studying spending trends, competitor pricing, average market RevPAR (revenue per available room) and other metrics allows revenue managers to take better pricing decisions and determine whether their rates are too high or too low in a given scenario. For instance, a hotel experiencing full occupancy by selling its rooms below the average market rate could actually be earning less than a competing property, with 90% occupancy, selling its rooms at the right price. With hotels and the industry generating massive amounts of data, the only viable storage option will be the cloud. Cloud storage isn’t just practical and cost-effective, it’s also secure.
Let’s take a closer look at how exactly big data can help hotels.
Guest profiling: Personalization is on its way to becoming the norm in today’s industry. Fortunately, it’s not as hard as it sounds. Evaluating the background of guests is a great way to improve the quality of their stay. With travellers providing information about their age, marital status, purpose of the visit and so on, hoteliers can now get an idea about each traveller’s unique interests. This is invaluable data, and can be used again and again to improve recurring visits, establishing loyalty in the process.
Rate management: A number of tools are available today that leverage industry data to help hoteliers make estimations and predict future demand to an extent. By analysing trends in the local economy, guest behaviour, currency fluctuations and more, managers can optimize their room rates to maximize profitability. Not only does this enable them to sell their rooms at the best price, it also helps create demand during the off-peak season. Hoteliers having access to rate-shopping tools can use information from global online travel agents (OTAs) and even suggest an optimal rate.
Artificial Intelligence: With lifestyle technology becoming increasingly common in our daily lives, the amount of personal data collected by connected devices is set to explode. Artificial Intelligence (AI) will mine this information and determine which artefacts need to be retained and can add value to the guest experience.
This mining will ideally happen across multiple platforms such as Facebook, Google, iOS and so on. With privacy concerns rising, AI offers hospitality industry a way to streamline the entire guest cycle while supporting legislation requirements.
Few industries are better positioned to leverage the present-day abundance of consumer information than the hospitality industry. Guests leave their details on almost all OTAs, hotel websites and social media. Technology companies are quickly spawning around the world, making use of the cloud to offer hotels the opportunity to connect with their guests as never before. Property management software, guest experience apps, revenue management systems and other cloud-based tools now enable hotels to significantly enhance the guest experience.
It took a while for large segments of the industry to warm up to the idea of SaaS, especially the small and mid-size properties. However, as the benefits of these subscription-based services continue to become increasingly apparent, a large number of hoteliers continue to steadily migrate to the platform. Today, cloud is more than just a platform—it’s a revolution that has reshaped the very foundation of the industry, equipping independent hotels around the world with enterprise-level tools that enable them to compete and win against the evolved, international chains.
Prabhash Bhatnagar is the founder of Hotelogix.