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The Role of Technology in Supporting Business Development in the Hospitality Sector

Diana Szpytma 19 October 2018
The Role of Technology in Supporting Business Development in the Hospitality Sector

By Michael De Jongh, Chief Commercial Officer, Avvio

Most hoteliers did not go into the hospitality industry due to a love of digital technology, but because they enjoy providing great service to guests in person. However, embracing digital technology is now vital to getting guests through the door and building a thriving hotel business.

A hotel’s digital sales strategy should sit at the centre of its business development plans, alongside quality customer service, a great restaurant, conference centre facilities or any other attributes which are likely to boost sales and repeat bookings.

Work with the OTAs not against them

OTAs are often presented as the bully boys of the hospitality industry, diverting the vast majority of guests away from direct hotel bookings and then claiming a large slice of the profits through transaction fees. However, savvy hoteliers should not view OTAs unfavourably. They have their place and have far greater global sales and marketing capabilities than most individual hotels could ever dream of. OTAs can be a big help in driving bookings generally and attracting more guests from new overseas territories such as China or the US.

Individual hotels struggle to compete with OTAs on Google paid or organic search ranking results. They cannot outsell, outbid or out-market OTAs, so they should explore and make the most of the opportunities created by working with them.

Be more direct

You’ve got to give people a reason to come directly to you. Incentivising guests to book on your own channel whether that is through special deals and offers or complimentary services and extras which are only available to direct bookers. Deciding what your hotel can offer by way of incentives is the easy bit, it is communicating this information to the people you want to reach effectively that is the trickier task.

Digital technology now enables smaller independent hotel businesses to reach and communicate with people all over the world and, even better, to tailor those communications to suit the individuals in question, hugely increasing the potential impact.

New artificial intelligence (AI) powered booking systems can also personalise the booking process to ensure relevant additional services and deals are highlighted along the way.

You do not need to be a technology expert to make the most out of the digital functions that are out there, but you do need to know the right people to partner with.

Personalised sales and marketing

Initially, the technological overhaul of the hospitality market saw many, previously manual, tasks automated but in doing so hotels lost the more personalised human element of the hotel booking experience and customer service.

However, AI and machine learning take our automated digital systems to the next level by enabling them to learn from customer behaviour, industry trends and crucially, to personalise and target their offering. While chatbots and mobile phone apps have been able to provide limited ‘digital concierge’ services for some time, the addition of real AI is a major step forward for the industry.

Digital communications mean hotels collect and store a huge amount of valuable data but until the arrival of AI and machine learning, they did not have the manpower to assess, analyse and use this information effectively. Now AI-powered systems like Avvio’s Allora AI booking platform, launched last year, can collate and analyse the data to create more effective and personalised customer offers through recommender engines.

Stand out from the crowd

With online searches presenting guests with hundreds, often thousands, of options for hotels and other accommodation types, many people feel a ‘choice fatigue’. Customers do not want to sift through hundreds of options desperately trying to find the best one. What they want is the perfect choice presented specifically for them. It is not about doing things differently, it is about doing things better for that specific individual.

Technology offers the ability to make better informed decisions for more accurate guest targeting. Machine learning is applied to large volumes of data to analyse patterns which identify what it takes to convert a shopper. This results in relevant marketing messages aimed at specific website visitor profiles to create a booking journey more likely to be relevant to people’s needs or preferences.

If potential guests find what they are looking for faster, they are more likely to book direct or return to book at the hotel at a later date. Why present the same “book now” page generically to every potential or even worse, already booked guest?

Today’s hotel guests are already accustomed to more tailored digital content and services. Future guests will therefore expect more sophisticated and personalised interaction with hotels. AI enables hotels to make specific recommendations, suggest trips, or upsell additional services to customers – and teaches itself how to enhance a visitor’s experience.

Stay in touch!

The best time to market repeat bookings to guests is when they are staying with you, firstly, by providing them with a wonderful and memorable experience but also offering them tempting incentives to come back soon. Once they have left, ensure you stay in touch – as long as you have secured permission to do so of course!

Email marketing can still be remarkably effective, with 72 percent of customers preferring it as a means of interaction over other forms of communication according to McKinsey & Company as referenced in an article by Hotel Management. Other channels are increasingly more available, apps and social media for example and don’t ignore SMS as open and act on rates are still huge.

Technology takeaways

Hoteliers don’t need to be tech experts to take advantage of emerging tools, keep to these five steps and work with expert partners like Avvio to deliver your hotel’s strategy.

  1. Incentivise – give guests a reason to book direct that they won’t find anywhere else
  2. Personalisation – harness technology, use AI to crunch and interpret the big data and work with partners to analyse and segment guests for more targeted marketing
  3. Don’t ignore sales channels. Consistently review effectiveness, ensuring you adapt and change. Don’t be afraid to try new things.
  4. Remember exceptional guest service is, and always should be, a vital part of your marketing mix
  5. Keep in touch – get to know your guests and then don’t forget them.

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