It’s that time again… time for another set of hospitality industry myths to be BUSTED! After 25+ years of selling tech solutions to hoteliers, I wanted this article to address two key myths which, I believe, are two of the key reasons that hotel technology adoption rates are so low, worldwide.
NB: This is an article from Zucchetti North America
Let’s start with a myth that you will probably be surprised to hear come from my mouth…
MYTH: The best way to improve the efficiency of your operations, boost bookings and revenue and improve the guest experience is to invest in an integrated tech stack.
Yes, you heard me correctly; that is a myth. Tech stacks alone – no matter how integrated or high-tech they are – are not the be-all and end-all that many technology vendors make them out to be; while they are very important to long-term success for hoteliers (especially given the ongoing advancements of the industry happening at, what can often feel like, the speed of light), technology can never and will never be sufficient to replace the humans working in the hospitality industry – and that means that a tech stack alone is never the whole solution to any operational or other issue at a hotel.
Technology (especially those powered by AI) can assist in data analysis and prediction, but human expertise is still essential for interpreting these insights and making strategic decisions, which make or break a property’s success – which is why an RMS, or a CRS, will never replace the revenue manager or the reservations department. Computers cannot think strategically, pivoting as the marketing and guest booking trends change, or to comprehend, or address guests’ wants, needs and requirements, when it comes to their travel experience. That is why the human element is one of hotels’ most important assets… and one that is often overlooked.
The human element is what creates the sense of emotional engagement that takes guests’ stay from good to great and keeps guests coming back, again and again. When it comes to marketing, only strategic minds (a.k.a. humans) can effectively present the property in a way that will stimulate potential guests’ emotions to encourage bookings, and only humans can truly understand and create experiences that today’s experientially focused guests want.
As such, an effective human workforce, supported by an advanced, integrated tech stack, is hoteliers’ most valuable resource (especially during staffing shortages!). Larry Mogelonsky, P. Eng. made a very good point that I want to include here to reinforce the importance of a property’s staff in its success:
Property has gone through the iterative, oft painstaking and consummative process of upgrading its tech stacks, yet its human stacks remain firmly stuck in the 20th century. Departmental silos are common, leading to goal misalignment, office politics that waste resources, lowered morale and reduced overall productivity. Meanwhile, team empowerment and agile decision-making exist in name only, without the proper policy framework to prevent homogenized groupthink outcomes.
Larry’s example is an all too common occurrence and lack of attention paid to “the human stack” (to use Larry’s word) keeps hotels from being as successful as they could be, even with the best tech stack in the world.
To sum up, hoteliers absolutely do need technology to thrive in today’s global hospitality market but they also need to realize the importance of the people who work, day-in and day-out, at the property, interacting face-to-face with guests – and give them the proper training, tools (plus proper training on the tools) and a corporate structure and leadership team that will empower them to excel. This is how hotels will stand out from the pack.
MYTH: Every type and size of hotel needs the same basic tech stack to be successful. In my day-to-day conversations with hotels, I hear certain questions frequently; one of the most common is: What is the ‘best’ tech stack for my property? What specific solutions are ‘must-haves’, and which are ‘nice to haves’? There are too many options!
Generally, it’s simple to say that (most) hotels should have a PMS, CRS, booking engine and channel manager but the reality is very different than this hypothetical answer. While some technology vendors may want you think otherwise, there is no set list of solutions that are absolutely necessary for every single type and size of property worldwide, because each property, destination, core guests and business goals are different. These four variables are key in deciding what solutions need to be included in your tech stack because you need to invest in the solutions that will bring you the highest ROI and help address your property’s specific pain points.
Let’s look at some examples…
If you are a small property with limited service, located on or near a major freeway or road, in or near an urban center, you are likely relying on OTAs and drive-by traffic to provide most of your occupancy. As such, having only a PMS, booking engine and channel manager would be sufficient as your tech stack.
If you are a property in a highly competitive destination or a large resort property, either of which are primarily visited by people who arrive by air, you will need additional solutions to ensure ongoing profitability in today’s marketplace. In this case, the must-have solutions in your tech stack should be:
- PMS – To oversee and manage all the operational elements on your property.
- Booking Engine – To enable direct bookings.
- CRS – The distribution link between the PMS and all sales channels.
- GDS Connectivity – To obtain bookings from travel agents.
- RMS – To ensure your property is priced correctly, for optimum occupancy and RevPAR, across all online channels.
- Channel Manager – Integrated with your PMS, the channel manager aggregates the updates of rates and inventory across all online channels automatically.
But, in addition, this type of property might also want to consider implementing a Metasearch Management solution (a tool to assist in navigating metasearch channels more effectively), Business Intelligence solution (to gain a more holistic view of the property’s performance), a Reputation Management solution (to oversee and manage the property’s reputation across all the online channels) and Upselling tools (to encourage higher RevPAR on direct bookings), among many others. Again, this would come down to this specific property’s pain points (i.e., staffing shortages, guest expectations, destination demand fluctuations, etc.) as that would influence what type of solution would help solve the problems that are blocking their overall profitability.
See the difference? To determine your property’s ideal tech stack, think about what your guests’ booking journey looks like, consider your overall business goals, the elements that affect supply and demand in your destination, and your property type and size before deciding, as these variables will guide you to the correct list of solutions necessary to address your property’s current pain points.
So, there you have it… two very common tech stack-related myths busted! (Not a bad day’s work, if I do say so myself.) I hope that this article has given you more insight into the importance of both a forward-thinking tech stack, but also, your human tech stack.
I raise a glass to you, the innovative hotelier that you are, and cheers you with an iconic phrase that perfectly encapsulates your property’s new and improved trajectory: To infinity and beyond!