The
global hospitality industry is expanding rapidly with more hotel investments
and a growing population of consumers. The world of accommodations, food and
beverage, entertainment and leisure are dynamic as evolving consumer
preferences, economic shifts, technological advances and potential risks -
from climate change to viral outbreaks - push businesses to think bigger.
Yanolja, a global
leading travel technology company that has provided its vertical SaaS (software-as-a-service)
in over 216 countries, has analyzed some of the key trends and outlook for the
future of digital transformation.
The transformation
strategy of a decade or two ago, which narrowly focused on improving
operational efficiency, reducing costs and enhancing customer convenience at
the property level, has moved into the rearview mirror. A more comprehensive
approach that gives businesses of all sizes more market access, revenue,
efficiency, scalability, security and decision-making capabilities drives
modernization today.
Digital transformation
in hospitality to date has been gradual. Hotels have historically lagged in
technology, with digital upgrades reserved for the large hotel chains while
small property owners (except for a savvy few) chose to rely on manual processes
and an ample labor supply to keep their businesses afloat. Recent trends have the potential to alter those
dynamics.
The global hospitality industry is heating up
The world is becoming
increasingly welcoming to wanderers and neophiles. As one of the world's
largest and fastest-growing travel sectors, gross bookings for hotels globally
grew from $450
billion in 2022 to $510
billion in 2023 and are expected to reach $560
billion next year, according to Phocuswright.
Hospitality is growing
even faster in regions like India, where Yanolja has invested in a research and
development hub. The total hotel market in India is expected to expand by nearly 18% between 2019 and 2025, according to Phocuswright’s
latest India Travel Market Report. The country’s total
travel market is expected to grow to more than $40
trillion by 2025, a nearly 27% increase from 2019.
Growth has a ripple
effect. It ignites competition across existing and emerging hospitality brands
and means more employees, properties and machines will have to connect to
centralized data and applications. Plus, to remain visible and viable, hospitality businesses must tap
into the expanding ecosystem of online intermediaries, from hotel room booking
sites to restaurant reservation systems.
In an expanding market,
hospitality businesses seek ways to harvest opportunities. To answer the call,
technology firms offer software for online distribution to help customers gain
more market exposure, revenue management to boost income and profitability and
property management to handle the influx of more guests
efficiently.
Consumers want better and more differentiated
hospitality experiences
Technology providers
help hotels and resorts fill these customer-delight gaps by offering
contactless, kiosk and mobile options for check-in and check-out and providing mobile-enabled keyless door locks to
speed up room access. By leveraging the Internet of Things, “smart
rooms” allow guests to personalize their rooms by automating and controlling
in-room devices, such as entertainment systems, lights, thermostats, security
systems, speakers and smart mirrors using a mobile phone, tablet or voice
commands.
Recently Yanolja
Cloud, one of the subsidiaries of Yanolja and an artificial intelligence-based
solutions company, partnered with Samsung Electronics to provide hotels with
check-in and check-out kiosks that also support the real-time synchronization
of reservation statuses from various online and offline booking channels and
the hotel’s property management system.
Kiosks, chatbots and
robots can reduce the level and cost of human resources needed for guest
check-in and check-out, front desk inquiries and room service order delivery
while providing guests with the efficient, useful experiences they increasingly
seek.
Data and analytics empower hospitality
Hospitality businesses
have always valued data. But what was regarded as important, instructive or
good to have in the recent past is now the competitive, operational and
financial “secret weapon” for firms of all sizes across the lodging, travel,
tourism, food service and leisure spectrum. Fifty
percent of global travel and hospitality sector executives surveyed stated that
customer data analytics was very important to business success.
Data from multiple
sources - customers, operations across numerous properties, intermediaries, devices and competitors - is the currency of
a hospitality business. With data analytics, hotels can discover insights to
outperform competitors, spot emerging market trends, fine-tune pricing
approaches and enhance their marketing tactics, helping them respond to
fluctuating market conditions and secure a competitive advantage in the sector.
The proliferation of
data pushes the concept of a hospitality cloud to the forefront of digital
transformation. Unlike on-premises networks that behave like multiple islands
in a vast sea of information, cloud infrastructure allows businesses to pool
data from various sources and let it flow freely (outside the typical silos)
across the organization.
Broad access to secure,
reliable data and analytics opens the door to vast business potential. For
example, Yanolja Cloud and its member companies help
business owners better understand their customers' behavior, optimize pricing and revenue management
strategies and enhance distribution and marketing programs. Artificial
intelligence will only expand and
accelerate these capabilities.
Although the
hospitality industry is booming, the terrain remains challenging for business owners,
many hampered by the difficulty of selecting and implementing technologies to “satisfy
the growing and increasingly complex needs of guests
Data protection is essential in the hospitality
industry
While climate, economic
instability, social unrest, the threat of a global pandemic or cyberterrorism impact many sectors, hospitality
is arguably more exposed. Thus, hospitality
business owners must be more prepared than most to address and adapt to
disruption whenever and wherever it occurs.
As a consumer-facing
industry, hospitality is the guardian of an immeasurable amount of customer
data, from credit card numbers to personal identifiable information and
business data, from financial and banking information to personnel records,
which cyber thieves can appropriate for nefarious purposes.
Cloud-based property
management systems allow hotel properties to manage operations from anywhere
(as the world learned during the pandemic) in case of emergency. With data
secured, businesses can be up and running much faster and focus on the lessons
learned to be ready for whatever comes next. A cloud-based cybersecurity
infrastructure also helps detect bad actors and safeguard valuable information.
Sustainability is increasingly critical
There is a growing
concern among consumers about the impact of climate change. In a Booking.com
report, 83% of global
travelers think sustainable travel is vital, and Accenture
research found that 83% of 25-
to 34-year-olds are willing to pay more for sustainable travel options.
Hospitality businesses stand to gain from doing good for the
environment. Sustainable
tourism is expected to grow by $336
billion from 2023 to 2027, accelerating at a
compound annual growth rate of 9.5%. Those that struggle or avoid aligning with
customer preferences are vulnerable to their greener competitors.
Although the digital
transformation of sustainable practices in the hospitality market may be moving
slower than consumers and the planet require, technology providers are stepping
up. Internet of Things implementations reduce energy consumption, waste generation
and carbon emissions. Hotels can also lower energy usage with cloud-based
software on remote servers rather than on-premises hardware that requires more
power and cooling.
Learn more!
Find out about Yanolja's mission to lead the digital transformation of the travel
industry.