person touching a screen overlayed with a digital cogwheels image reflecting the paradox of hotel technology

Let’s begin with a provocative question: “Has ‘Digital Transformation’ actually helped your guests?”

NB: This is an article from Shiji

When looking at the Hospitality Industry’s technology landscape, we can easily see that it is highly fragmented. There are myriad solutions and providers popping up all the time, making it easy to lose oneself in a convoluted maze of systems and integrations as well as the reason we are looking to make a digital in the first place: improving efficiencies for the business, yes, but also for the guest.

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As reasons for this deep fragmentation, amongst many others, we can cite region-specific barriers to adopting technology from an end-user perspective, solutions targeting different segments of the consumer population and certain elements of the guest journey, brand or hotel chain-specific regulations, and security and data compliance barriers, all detracting from a seamless guest experience when not integrated thoughtfully.

If we compare ourselves to other industries, such as banking, travel, or shopping, we can see they are further along to a degree, with some players able to provide much better experiences to their customers than others. With retail, for example, a shop’s fully digital experience can be very seamless whereas another’s isn’t as good – it becomes almost a learned, behavioral experience in choosing what technology to adopt and what will work, not forgetting incentives such as loyalty programs or rewards to encourage desired behavior.

table showing how do hotels rate their technology

We are still in a period of transition that is quite protracted and there’s no way of knowing how long it will last, although my guess would be that it isn’t going to be much longer and that we can expect some clarity and consolidation soon – coming from two fronts.

On the vendor side – the ones providing the technology – there are acquisitions, mergers, and all sorts of things taking shape, with the same ringing true for hotel groups and hospitality operators. 

These players are survivors or casualties of the aftermath of the COVID-19 crisis and are merging, acquiring, and combining their brands and operations. It’s a period of disruption that brings with it turmoil, but also new solutions and new tech to choose from. Some of it will work and be adopted, and some of it will be but a blip on our radars down the road. One thing that is certain, though, is that we are collectively recognizing the increasing need to focus on the guest journey and its digital steps in either business or operational decisions, and this will guide the choice of partnerships and vendors.

The days of monopoly vendors are gone, and so are the days of international hotel groups being able to mandate only one or two tech providers across a portfolio of hotels in an entire region. The accelerated pace of expansion that hotel groups are undertaking today demands a diversification of stakeholders and operating models, making these strict mandates neither viable nor effective. 

I see this period of consolidation of both hotel groups and technology vendors moving towards a balance where the options will be few, but will most likely have to be complete and partner well with other solutions to support the customer journey and business needs.

Read rest of the article at Shiji Insights