With growing competition in the supply chain and hotels increasingly under the cosh, if nothing else they need to keep focused on delivering a great service.
NB: This is a report by Pamela Whitby, editor for EyeforTravel.
Watching Priceline’s moves in 2014 has been a bit like being a fan of James Bond.
Number 24 in the longest continually running film series in history is currently being produced at London’s Pinewood studio. At this stage, we know who the main man will be, some of the villains and the title: Spectre. But much remains a bit of a mystery.
Similarly, in 2014, we’ve seen a number of new actors cast in the Priceline show - first, it bought online restaurant reservation system, OpenTable, then digital marketing agency, Buuteeq, and then property management system, Hotel Ninjas.
Very likely, it’s all part of the plan to create a complete product for hotel brands. After all, Booking.com and other OTAs already offer white label website solutions.
And a white-label solution PMS for hotels in addition to a website offering, could be Booking.com’s winning line given that development and maintenance of a site is one of the biggest expenses of a hotel/brand.
Jason Antony, assistant vice president for digital engagement at the Viceroy Group, says:
"A white-label solution would lower the cost and potentially produce a much higher return on investment. To be honest, this is something Google should really be doing."
In this scenario, we see Priceline cast as the good guy, working hard to make life easier and more profitable for hotels.
But not everybody sees it this way.
If you’re are one of world’s biggest hotels chains - InterContinental Hotel Group (IHG), Starwood, Hilton, Marriott or the like – the OTAs see you, not industry peers, as their biggest competitor.
Where the chains used to be able to bank on not insignificant numbers of loyal customers, today even that is no longer sacred ground.
Not only are OTAs wheeling and dealing to control more of the supply chain, they developing their own loyalty programmes to boot.
For some then, Priceline ain’t the good guy, it's the archetypal villain!
EyeforTravel MD, Tim Gunstone, for one, isn’t convinced that such a big monopolistic player is good for the industry.
He also knows that by applying data and analytics, in particular to the mobile channel, hotels have the ability to fight back and make more money from the guest during their stay.
After all, what the hotel still owns is the guest experience.
So hotels need to focus on driving loyalty; and IHG’s success with its mobile application has shown just how closely this is tied to mobile.
While mobile apps may work well for the big hotel chains, which like the OTAs, have the advantage of volume, what about smaller chains?
The big question for them is whether to outsource their mobile or loyalty programmes to a third party (like booking.com) or develop it in house.
One of the challenges is that smaller chains may invest in a mobile app, only to find that less that a month after the guest has stayed with them it falls into disuse, says Antony.
The evolution of hospitality
So is developing a mobile app a complete waste of time?
"It is and it isn’t. From an operations standpoint the hotel could see the benefit of saving time during check in process.
But even that is a double-edged sword.
"Vendors delivering mobile check solutions tell us that they have seen guest satisfaction scores actually dropping if there is no human interaction during the check in process."
Perhaps then, there needs to be a shift in thinking when it comes to mobile strategy, something that Antony describes as "the slow but steady evolution of hospitality".
It can’t simply be driven by a desire to increase bookings. Instead, in keeping with the true meaning of hospitality, it should be seen as just another service offering for a different type of guest.
"Whether you’re offering a mobile app or in room functionality there has to be a human touch and human interaction to provide the guest with a seamless experience and leave them highly satisfied."
Gunstone goes a step further:
"Travel suppliers need to partner with anyone that can provide them with a bookable database of restaurants, pubs, tours, taxis, activities and so on, so they can provide their customer with the services they really need during their trip."
Aside from putting hospitality at the centre of their business, the evolving booking process is another area where brands can still put up a fight.
While the OTAs like to stress that they provide the simplest and fastest way to book, they don’t – well, not yet – own the upgrade or the ability to dynamically package, says Antony.
Eye on technology and social steps
Keeping on top of an up to date with technology developments is essential ingredient. Antony, for one, believes that by 2016 near field communication (NFC) could change everything.
"Apple is already using NFC for payments and if everybody shifts to this technology, and I believe they will, brands won’t need to develop apps in the future.
"That’s a huge barrier to entry right now especially where Internet connections are limited."
With the arrival of Apple Pay the shift to contactless payments looks set to continue too, which will help to make the check in, restaurant, spa, and so on, experience that much easier.
Another not-to-be-ignored channel is social media.
Fiona Boyce, director of social media and brand content at Commune Hotels & Resorts, says:
"If you’re talking about the guest experience and service, social media is an incredibly important tool.
"The value or solving someone's issue during a rocky stay, or making a trip even better through social media learnings and surprise plus delight is one of the best uses of social media, and the ROI is invaluable."
Interestingly, while some commentators have sounded the death knell for Google+, some in hotel industry see the search engine giant’s social channel as a priority.
Antony, for one, would like to see hotels in his group putting more energy into Google+. That's because by posting regular content on your page, the impact on your organic search rating can be significant.
No doubt, this is part of the reason that Europe’s regulators are up in arms over the dominance of Google in the world of search!
NB: This is a report by Pamela Whitby, editor for EyeforTravel. It appears here as part of Tnooz’s sponsored content initiative.
NB2: Don’t miss Mobile and Innovation Strategies for Travel in San Francisco (March 23 to 24, 2015) where Antony and Boyce and many others will be speaking.
NB3: Hotels welcome image via Shutterstock.