AI-driven analytics will provide hard fast ROI - but are hotels ready?
For hoteliers looking to Find customers, convert them to Book, and Grow revenue amid stiff competition, smarter data insights are necessary. But if more isn’t done to bring system data together in a cohesive, intelligent and integrated way, commercial teams will flounder, unable to deliver hard fast ROI cannot.
We operate in one of the most complicated industries, where every aspect of operations is a priority, and guest experience is everything. While offering guests a little respite and facilitating a brilliant experience – there’s the maintenance of physical spaces, managing a balance sheet with consistently high outgoings and fluctuating incomings. All with the need to constantly stay relevant amid changing consumer trends and fluctuating economic markets.
Whether an independent hotel or part of a group – each property acts as a small business in its own right. Where on the surface, the hospitality experience is reassuringly the same, behind the scenes it has had to adapt to an all-encompassing digital world. One where guests have been captured from a multitude of third-party partners and reservations come from a range of booking interfaces, and your reputation constantly hangs in the balance through social media and reviews.
Being in a high-velocity sector like this often means structures, processes and team frameworks can become outdated quickly, causing fragmentation and friction when trying to respond to changing market dynamics and optimize revenue.
Addressing industry fragmentation
Technology is now addressing and solving this challenge. Through intelligently designed hotel tech stacks weaving together a property management system (PMS), a customer relationship management (CRM) system, and a central reservation system (CRS) hotels can achieve great efficiencies. In saving hours on time-consuming administrative tasks working with shared data, hotels can better understand, service and target guests.
However, these integrated systems still do not exist in a way that enables hotels to benefit from a central pool of data and look in detail at the performance of all aspects of commercial strategies to continuously improve impact.
The reality is that hotel teams are still working in silos across multiple systems. Hoteliers are drawing single reports from a digital marketing platform, another from the CRS, and perhaps one from the CRM. Each report shows a different aspect of a campaign, seasonal trend or guest behavior – but provides no single complete picture.
We’re working on changing this.
On a human level – commercial, revenue and marketing teams need to be more aligned and recognize how interconnected their work is. And on a technological level – data from across all these commercial aspects need to come together to support more informed decision making and strategic development.
Accessible data and reporting
Hospitality isn’t short of data. In marketing alone, teams can access a huge amount of information from email, social, display and brand campaigns assessing clicks, likes, bookings performance of promotional codes and influential media partners. These are all great for internal reporting, but marketing professionals need to dive into ROAS connected to high-value and relevant guest profiles.
By gathering insights into guest behaviors, preferences, interests and booking patterns, hospitality teams can interrogate their own data. Access to this must be easy and intuitive to help hotel teams become more skilled in data analysis and act on those insights.
Teams fundamentally need to make connections between data from across these systems. Almost a third of hoteliers interviewed for the h2c Hotel Direct Booking study said there is insufficient reporting from their internet booking engine, and this is a growing concern. Pulling in data from all business areas would drastically advance the business picture that hospitality professionals receive – of patterns, trends and results from across the business.
Consolidated data is a necessity
It’s clear we need to get data out of silos. It’s apparent that hospitality professionals need to understand their entire data warehouse. And this all transcends individual business disciplines such as sales, marketing or revenue.
Solving this conundrum should focus on bringing these three disciplines together with an analytics solution that uses the power of business intelligence (BI) tools and AI. This way sales, marketing and revenue can each look at the same data through their own lens with simplicity. Consolidated data enables a deeper level of probing and extrapolation of patterns in meticulous detail to identify the influencing factors to finding the right customer, generating quality bookings and growing revenue.
So instead of calculating the clicks from a specific digital marketing campaign, and analyzing this in its own silo, the platform will show how the campaign affected booking patterns and revenue per customer.
This simply hasn’t been possible before.
Generating more revenue
There’s currently a major e-commerce drive for hotels, which links with boosting upselling and ancillary revenue opportunities. According to h2c Hotel Direct Booking study, estimated ancillary revenue potential is higher than actual revenue, and most hoteliers want to explore ways to maximize this opportunity.
McKinsey & Company also found that combining multiple sources of data can help guide hotel strategies for unbundling and cross-selling, to fine-tune experiences travelers are actually seeking out. They call this “the future of travel.”
Elevating data analytics tools will help make this a reality for hoteliers.
And the role of AI?
Hotels are still figuring out how AI can help. The use of AI in hotel booking engines is expected to roughly double over the next few years too, and AI for personalized bookings has the highest planned growth, with a potential 5x increase. But on a wider scale such as the broader analysis of data, AI could be central.
Hospitality is a human-first industry, we all need to learn how to use AI in a way to help rather than hinder our goals. Data is traditionally seen as being the opposite – hard, fast numbers. But this growing awareness of the importance of the analysis piece shows how data should be represented in a more palatable way. AI is a linguistic-led technology, and it can humanize the way data is consumed.
We believe this will further elevate the necessity of an all-in-one analytics dashboard. And although there is some skepticism around open AI, we’re instead taking AI learning models and putting them on top of data, to provide a robust and reliable solution.
Where is Cendyn on this journey?
The capabilities of existing technologies are vast, and we are bringing these together within intelligent analytics platforms. By layering in data science, artificial intelligence and machine learning, we are creating a one-stop-shop system that provides prescriptive insights. As well as showing you the data, it will tell you precisely the influencing factors to campaign success and insights of the audience you should target.
As we advance analytics across Cendyn we hope to allow hotels to understand what is happening at a granular level. What type of searches are taking place? When is the highest and lowest search level? What is the conversion rate based on searches? While understanding if you’re ahead of pace or behind pace on searches? How does that impact existing marketing programs? Does the price point need to be adapted, or does a new campaign need to be launched?
These are questions hospitality marketing professionals ask themselves all the time. And our future advancements in Analytics will tell you where the opportunities are and how to act upon them.
In an age of tough competition and accelerating operational costs, every marketing campaign, room rate strategy and commercial decision will have to be informed by reliable, interconnected data – with no room for uncertainty.
If the goal of any hotelier is to Find customers, ensure they Book, and Grow profitability, breaking down silos with the help of technology is the way to bring about lasting change.
