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A Guide to Digital Transformation for Hospitality

Driving digital transformation in the hospitality industry

Digital transformation has made it to hospitality, and it is just in time. Guest expectations have changed; they demand digital communication and personalised experiences. More people travel than ever before, and a burgeoning middle class in places like China, India and South Korea is putting pressure on established hospitality infrastructure.

Hospitality teams need to improve service, decrease costs and reduce waste — digital tools are the answer. It is the responsibility of IT departments to accommodate change, make the right investments and pick technologies that will deliver.

 

Part 1: The Problem of Digital Transformation for Hospitality

It is a momentous challenge to accurately peel buzzwords apart from emerging technologies that will fundamentally transform how the industry interacts with customers and guests. Then comes the difficulty of picking vendors and understanding what infrastructure basics are required to deliver seamless, high-tech results — all within an industry that has a historically distanced relationship to IT.

Time is of the essence. Getting ahead of the digitalisation curve is critical to making the most out of your digital investments, grab a competitive advantage and avoid being left behind. Doing what you have always done will not continue to get results.

This is your guide to making these choices, delivering you insight into the future of the industry and providing you with the context needed to make the right decision. Getting results out of IT starts with understanding the outcomes you’re seeking to achieve. Only then can you make investments that deliver. Partners will help you dive into the specifics. This is your primer on starting a digital transformation journey in hospitality.

 

“Getting ahead of the digitalisation curve is critical to making the most out of your digital investments, grab a competitive advantage and avoid being left behind.”

 

Part 2: The Benefits of Digital Transformation for Hospitality

With the right investments, the possibilities of what digital transformation can deliver are huge. Hospitality businesses that invest first will not only gain the following advantages, but they will also gain a competitive advantage. But, any hospitality business investing in IT should aim to achieve the 6 following results.

#1 Reduce wastage

Reducing wastage is one huge benefit of becoming more digitally minded. You won’t need to send out brochures and leaflets attempting to get people into your business, when you can send out an attractive email shot with regular exciting news and events, maybe even deals to get people to want to work with you. Even loyalty cards can be online or on an app built especially for your business, which can avoid wasting card, paper, and plastic and ensures that your customers know how many points/rewards they have with you at one time.

#2 More personalised experiences

Digital technology will allow you to provide a more personalised experience for your guests. The flexibility of digital communication means that creating bespoke guest journeys is much simpler. You can set up experiences based on your guest’s profile, and provide them with a high level of assistance increasing overall satisfaction.

#3 Better customer knowledge

Going digital and digital transformation for hospitality creates a digital data trail, providing you insights into your customers and enabling you to understand your customers on a level never before possible. As a hospitality business, your goal should be to learn as much about your customer as you possibly can.

 

“With the help of data analytics, you can better understand your customer and get great information regarding their preferences and tastes.”

 

With the help of data analytics, you can better understand your customer and get great information regarding their preferences and tastes. This is a critical aspect of creating personalised customer experiences, and when partnered with bespoke guest journeys, the level of customisation is nearly unending.

#4 Decrease cost of serve

By going green with digital transformation you end up reducing costs. Stationary and paper cost the industry a lot of money. By removing that, you take a huge ongoing expense off the table. You also gain insights on your own operation that will help you deliver efficiencies.

Data analytics don’t just tell you about customers, they tell you how to cut waste and decrease costs internally. This is all on top of the fact that digital tools tend to create efficiencies when it comes to communication and administration all on their own.

#5 Improve customer experience

You can improve the customer experience by regularly updating customers on the latest news and by giving them access to content that can automatically be updated. Some hotels are using digital technology to improve the customer experience by offering self-check-in and guidance to reduce queues in place.

 

“Keeping improved customer outcomes front of mind should always take priority when investing in new digital technology.”

 

You may also want to inform customers of what is going on in your business in real time using social media platforms and other digital platforms. Keeping improved customer outcomes front of mind should always take priority when investing in new digital technology.

#6 Reduce carbon footprint

Digital transformation for hospitality means delivering more digitally focused services, you are becoming a greener business and reducing your carbon footprint. With less key cards, boarding passes, documents, and papers, in general, you will help the planet and consume fewer resources. You can also help the cause by heating a room 30 minutes before guests arrive, rather than keeping it warm all day long.

 

Part 3: Key trends that are being driven by Digital Transformation for Hospitality

#1 Invest in platforms that allow for a tailored guest experience

Guests accustomed to modern digital technology demand tailored experiences and digital means of communication. This fact makes the delivery of this outcome a priority. Your customers want to feel valued, and one-on-one personalised engagement at various touchpoints in the physical and digital worlds can help this cause.

Brands must strive to adapt to a guests’ preferred method of interaction. For instance, building a mobile application that a guest can use to perform the entire check-in process means they have a much smoother overall experience. Self check-outs are being rolled out almost everywhere, including in restaurants, from the local supermarkets to Mcdonalds.

Making your customers feel valued by delivering them agency over their experience and making things as easy for them as possible with technology is a must.

#2 Data and analytics that drive personalised guest experiences

The only way you can truly offer a personalised guest experience is if you learn all about your guests’ preferences, likes, and dislikes beforehand. Knowing your target audience and demographic is key. If driving blind, you might end up alienating guests instead of delighting them with your services.

You must invest in tech that will allow you to collect and view customer data and analytics to learn about them and deliver tailored guest experiences.

When you have the means to collect data and analytics, you can determine the most appealing incentives and experiences for them. With the right technology, you will be able to figure out how people use your website and apps, and what they likely want from you. Finding a partner that can help you to decipher the analytics you have found can simplify the process and make the right investments from day one.

 

 

#3 Better communications internally and with customers

In a hospitality business, things get busy. It can become difficult for everybody to stay on the same page. A digital employee portal is an effective way to ensure there’s no miscommunication throughout the day. An established portal built by a knowledgeable partner will allow you to seamlessly share all kinds of information with employees, such as incoming VIP guests, best practices, onboarding initiatives, health and safety instructions, maintenance announcements, and more.

When it comes to your customers, you probably know that there are many communication channels that people tend to use these days. There’s Facebook, Instagram, emails, and more. A hospitality business can use these channels to connect with their guests, build relationships, and provide them with updated information in real time.

Chatbots are a good example of a way you can answer queries faster, too. Artificial intelligence is becoming more widely used within this industry and is a great option when no physical staff are available to answer questions. AI can also be used for data analysis purposes, which will help you to draw important conclusions from customer reviews and surveys, further helping you to improve your services.

#4 Mobile first experiences

Going mobile makes everything much more accessible — the majority of your customers will own some kind of smartphone, so catering to them is key. Many people will search for information via their mobile device before travelling, and they will compare different destination options, read reviews, learn about experiences and more. They may even reserve tickets online, buying travel tickets and using their mobile phones to scan them rather than paper documents.

 

“Adopting a mobile strategy because of this is a must. You will be losing customers to your competitors that are far more responsive to customer’s needs.”

 

Once on their trip, they can use the same technology to figure out how to spend their day, and when they get back, they are able to leave a review. Adopting a mobile strategy because of this is a must. You will be losing customers to your competitors that are far more responsive to customer’s needs.

Mobile capabilities can include a mobile booking engine rather than one that has to be used via computer, a streamlined check-in process that can be managed on a mobile device, loyalty program integration, and effective use of mobile channels such as apps and social media. This will allow you to provide the best service and upsell/cross-sell throughout the customer journey.

For inspiration, you can look at companies like Airbnb, uber, ubereats, and so on. With mobile integration, many hospitality businesses find that their operations and processes become more streamlined, that they enjoy more selling opportunities at every touchpoint in the customer journey, and that they can send more targeted and personalised sales. Marketing communications become easier, too.

 

 

Part 4: How to Deliver Digital Transformation for Hospitality

Keep Outcomes in Mind, Understand the Basics and Be Honest About Your Internal Capabilities

There’s no better time than right now to digitally transform your hospitality business. Regardless of your current position in the market, the industry is changing. The longer you wait, the more you will be playing catchup rather than forging an advantage over your competitors.

To make digital investments that matter, you need to first keep outcomes in mind. Never invest for the sake of it, always have a roadmap for what your next purchase will deliver.

Second, make sure not to get ahead of yourself. Building truly tailored guest experiences, for example, requires first creating data analytics capabilities, and then the construction of customisable communication paths. If you want to cater to mobile first applications, you need to make sure that your content is optimised for mobile devices and then deliver a customer facing app. Everything builds on itself, and you need to keep these steps in mind, along with an outcome securely planted at the end.

Getting these choices right can be hard

Particularly when it comes to planning and procurement, managed IT specialists can help. They can even allow teams with very limited internal IT resources to manage and maintain complex and cutting edge IT ecosystems — jump-starting their digitisation and running to the head of the pack.

What is critical is that you are honest about your own internal capabilities. Getting over your head can ruin the return on investment that expensive digital projects have the potential to deliver. You need to plan and you need to be prepared. But, do not let these warnings deter you from getting started. The wins for hospitality businesses that get this right are huge. The wins for the businesses that invest first is even larger. Now is the time, you need to get planning today.

Andrew Fox

Mar 28, 2019

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