The travel and hospitality industry is witnessing a wave of information and communications technology (ICT)-driven re-engineering, which is creating a paradigm shift in the sector and offering a plethora of opportunities to companies in this space. The biggest driver of technology adoption among travel and hospitality enterprises is the growing need to deliver personalised services to customers. The emergence of numerous online portals, mobile applications and social networking sites has created a flood of real-time enquiries and demands, making it mandatory for enterprises to keep pace with the new media applications to reach their customers and be ahead of the competition.
Apart from providing newer ways of designing products to address individual needs, ICT-based applications are gradually becoming a part of the tourism industry’s core offerings, especially for high-worth travellers, who expect certain facilities to be available. Meanwhile, the hospitality industry has also moved way ahead since the first major ICT intervention of the property management system (PMS). PMS was adopted to facilitate the front office, sales, planning and operation functions and also help track properties located in far-flung areas. Now, ICT-based applications have penetrated deeply into the hospitality management sector, integrating hotel operations, reshaping the marketing function, improving total efficiency, providing tools for marketing research and partnership building, and enhancing customer services.
A look at some of the advanced technologies that are redefining operations in the travel and hospitality industry…
The travel and hospitality industry is implementing internet-of-things (IoT)-centric systems in order to better serve customers and increase the efficiency of operations. A key IoT application in the hospitality industry is guest room automation. For example, using a smart energy management system, the hotel staff can ascertain when a guest room is unoccupied and automatically adjust the temperature to reduce energy consumption by as much as 20 to 45 per cent. At the same time, a smart energy management system can also increase the levels of guest satisfaction by allowing a guest to adjust the lights and temperature using their hotel loyalty apps, TV remote and through voice interaction.
Further, IoT can be used for ensuring effective predictive maintenance. For instance, in case of breakdown of an air-conditioning system, the system sends an alert to the hotel staff so that the problem can be fixed while the guest is away from the room. The predictive maintenance systems can also help create maintenance schedules based on actual usage and not estimated schedules, for example in the case of battery and air filter replacements.
Leading hotel companies such as Hilton and Starwood are also offering their guests the ability to check in and unlock their doors with the help of mobile applications using Bluetooth wireless communication. Using keyless entry, these companies are lowering their labour costs while adding to the guests’ satisfaction by saving their time, which is otherwise spent in completing the formalities at the front desk.
IoT can also be used for providing a personalised experience to hotel guests. For example, an IoT platform can over time memorise a regular guest’s specific comfort preferences and automatically set up the room for the next stay by adjusting the temperature, lights, TV channels, etc.
Other hospitality businesses such as restaurants can also implement IoT systems for better inventory management. Sensors in their kitchens can track the food being prepared in real time and this can help restaurant owners implement better quality control and meet food safety standards.
In order to fully exploit the potential of IoT in the travel and hospitality industry, there is a need to make parallel investment in the right software and human resources to interpret the massive amounts of data generated by IoT-enabled devices and help draw actionable conclusions. While IoT sensors will provide travel brands with incredible new insights into their travellers’ habits, the companies also need to ensure that customers are confident of their personal information being used responsibly.
The travel and hospitality sector is leading the way when it comes to adopting cloud technologies. This can be attributed to the fact that more and more travel companies are looking for scalable, reliable and affordable support for boosting their market presence. Cloud computing eliminates the need for companies to buy and install expensive software and hardware, requiring them to only subscribe to a cloud-based hotel management system. This gives enterprises an opportunity to shift from a capex to an opex model, and divert more resources towards improving their non-IT offerings. The cloud allows data access from any internet-connected device, from anywhere in the world. In fact, many cloud-based solutions offer mobile and tablet versions of their applications. This feature is particularly useful for hotel chains, which can use cloud technology to manage their database and client requirements online from a single location. Thus, by moving to the cloud, travel and accommodation companies gain access to more flexible technologies, which improve uptime and effectiveness of IT assets and employees’ productivity.
Another major advantage that cloud computing offers is infrastructure scalability. Cloud applications are much faster and less expensive to scale up since there are no additional costs of adding more users. Moreover, since all applications are built on the same platform, pre-existing capabilities and services can be reused across multiple applications. Hence, in a cloud-based set-up, travel companies can scale up the number of servers available during times of seasonal rush, such as holidays, and scale it down when the demand is not as high. Further, cloud solutions help companies introduce innovative offerings without incurring large additional costs or process delays. For instance, one of the largest European airlines, Lufthansa has developed a cloud-based service, CloudStream, which enables passengers to pick out assorted content prior to departure, which can then be browsed via the airline’s internet access while on board.
In the hotel industry, cloud computing can be used in four key verticals – front-office applications (reservation system, check-in and check-out, housekeeping management, etc.), back-office applications (purchasing modules, accounting modules, inventory modules, financial and billing report), restaurant and banquet management (menu management system), and guest-related interface applications (call accounting system, energy management system and auxiliary guest services).
Thus, cloud computing technologies ensure travel and accommodation companies an easily scalable computing infrastructure that is available on demand and on a pay-per-use basis. However, the companies must analyse costs and savings associated with migration to cloud-based models because their subscription costs do not necessarily decline over time. Further, many companies may need custom changes in PMS applications to manage certain unique operational requirements. Moreover, if not safeguarded properly, cloud-based technologies can be vulnerable to external infiltration, thus compromising user privacy.
Enterprises in the tourism and hospitality industry are increasingly using social media applications to meet the rising demand of customers for a personalised leisure and tourism experience. A large number of leading hotel chains such as Marriott and Hyatt communicate directly with their customers by posting about new travel packages on social media. Hotels are using YouTube, Facebook and Twitter to showcase the facilities available on their premises and for sharing interviews with customers about their experiences. This helps companies in reducing their expenditure on marketing and advertising campaigns, making it possible for them to pass on the benefits to customers by lowering the prices of their offerings. Moreover, hotels and travel agencies that have an effective social media presence are able to promptly address customer issues, which further adds to their brand value.
Customers, too, use social media platforms to share information and research ratings on tourist destinations, quality of service in hotels and restaurants, and the environmental and social conditions of places. This helps other customers choose their holiday destinations and select their hotels. A study undertaken on the customer data of US-based travel and restaurant website TripAdvisor found that 53 per cent of potential travellers do not book hotels unless there is a review of the hotel available on social media sites and 23 per cent of US internet users are significantly influenced by social media for their travel/holiday-related decisions. The online vacation feedback is perceived similar to recommendations by friends and families.
Travel and hospitality enterprises can gain immensely from the adoption of advanced ICT. By being able to target the consumer better and offer a personalised experience, enterprises can promote brand loyalty and increase the customer’s return rate. At the same time, companies can enhance their own operational efficiency, reduce costs and improve their inventory management and service delivery through greater use of technological applications.
Puneet Kumar Arora