As we step into 2024, the realm of hospitality technology continues to evolve at a rapid pace, reshaping the landscape for hoteliers worldwide. Each year, Hospitality Technology turns to our content council – made up of industry experts – to provide invaluable insights into the key priorities and technological advancements shaping the future of hospitality. This year’s 2024 Hotel Industry Outlook indicates that top priorities in tech for the coming year will revolve around enhancing guest experiences through contactless services and AI integration, fortifying cybersecurity measures and redefining revenue management strategies.
Meet Our Industry Experts:
- Ajay Aluri, Associate Professor, Hospitality and Tourism Management, John Chambers College of Business and Economics, West Virginia University
- Cihan Cobanoglu, McKibbon Endowed Chair Professor Dean, School of Hospitality and Tourism Management, Muma College of Business, University of South Florida
- Daniel J. Connolly, Professor of Management, PhD, Dean of the School of Business, St. John Fisher University
- Mehmet Erdem, Ph.D., CHTP, CHE, Professor of Hotel Operations & Technology, William F. Harrah College of Hospitality, University of Nevada, Las Vegas
- Lee Holman, Lead Retail Analyst, IHL Group
- Vijay Raghavan, Director, Digital Stay Experience Products, IHG Hotels & Resorts
- Ed Skapinok, Chief Commercial Officer, Appellation
- Todd Wood, Vice President, Global Applications and Transformation, Mandarin Oriental Hotel Group
- Rami Zeidan, Founder & CIO, Life House
What technologies should hoteliers prioritize in 2024?
Aluri: The hotel industry must prioritize integrating contactless services, automation, and AI technology to meet guests' evolving needs. By doing so, hoteliers can enhance guest experiences, sustainability, loyalty, and, ultimately, their bottom line.
Cobanoglu: Top tech priorities in 2024 should include strengthening cybersecurity measures to protect guest data and payment information, AI and ML for predictive analytics to optimize pricing, room allocation, and personalized guest experiences, energy-efficient systems and smart building technologies, and training programs that leverage technology, such as virtual reality, for simulated scenarios.
Connolly: Hoteliers need to continue to focus on the basics of accommodating guests’ needs and delivering great, personalized service. The bells and whistles don’t matter if the basics aren’t done well. Guests crave consistency and accuracy, reliable and fast Internet connectivity, and convenience. Additionally, data security will remain a top priority. As technology improves for businesses, so do the capabilities of bad actors. Data security, a fundamental expectation for all, can never take a back seat or be considered a fait accompli.
Erdem: Figuring out alternative metrics to traditional ROI when investing in technology and related services. Many hoteliers admit the difficulty of tracking the contribution of technology initiatives to business metrics. It is imperative that hoteliers make the identification of such metrics a priority, especially given some of the adverse economic outlook around the world.
Holman: New payment terminals / investing in PCI, personalizing the customer experience, embedding AI into existing apps, and upgrading CRM/loyalty programs.
Raghavan: Improved guest experience, better security and ease of booking.
Skapinok: Clean your data and improve your user interfaces both internally and externally. Make your data actionable.
Wood: Always security first. Continuing to build, cleanse, and utilize data to provide insights to drive revenue and personalized customer service.
Zeidan: Holistic Revenue Management automation. Revenue management is complicated and extends beyond dynamic pricing alone. Hoteliers should leverage technology to automate the revenue manager, pricing analysts, marketers, reservationists etc.
What are the issues keeping you and other hotel executives up at night?
Aluri: With the rise of digital platforms, data security and privacy have become key concerns. People now prioritize safeguarding their personal information in addition to guest experiences. Businesses should prioritize developing robust security measures to foster customer trust and confidence.
Cobanoglu: First, data security and privacy, specifically concerns about protecting guest data from cybersecurity threats and ensuring compliance with data protection regulations. Second, economic uncertainty, specifically fluctuations in the economy and its impact on travel budgets and consumer spending. Third, staffing and talent management, specifically when it comes to recruiting and retaining skilled staff in the face of labor shortages.
Connolly: Both worker shortages and rising labor costs. Empowering guests through technology using mobile devices (think mobile first), kiosks, the web, and push communications should continue to be a priority but with an eye towards guest-centricity, personalization, and friction-free service delivery applications and processes. It will also be important for hoteliers to consider ways to apply technology to free up staff who can be redeployed to guest-facing positions to interact directly with guests and ensure that the personal touch remains a hallmark of hospitality.
Erdem: The saga of warm-body syndrome continues to impede consistency in service despite the increased pace of automation to address qualified labor shortage and talent retention issues. There is a sense that staff shortages across the hotel industry will continue throughout 2024.
Raghavan: First, system and network security. Second, labor shortages. Third, guest feedback on social media and third-party websites.
Skapinok: Disruptive forces in the shopping/buying journey particularly voice search and AI integration within deep-pocketed intermediaries, including search engines. An honorable mention goes to Super Apps.
Wood: Data security, data residency and data compliance.
What is the greatest disruptive force within the hotel industry?
Aluri: Hotels must catch up to OTAs and short-term vacation rental marketplaces in adopting and exploring AI and digital customer journeys. OTAs and rental marketplaces can offer personalized products and services through digital platforms and mobile data. The hotel industry must invest in research and development to remain competitive, improve customer loyalty and revenue, and keep up with the constantly evolving expectations of modern-day consumers.
Cobanoglu: Both AI and the use of robots.
Connolly: Artificial intelligence (AI), along with all of its variants, continues to represent the greatest technological disruptor for the industry. We saw a lot of activity and experimentation last year, but this year, we can expect significant strides given the initial successes of many of the initial applications and because of significant improvements in the technology as well as in our understanding of it.
Erdem: Without a doubt, it is generative AI. Personalized service product recommendations are going to be the norm and the expectations for hotel guests. The accelerated rate of generative AI evolvement and applications pose a challenge for hotel executives who may hesitate about which solutions to adopt.
Raghavan: COVID-19: There are so many hotels that are still not out of the woods when it comes to the impact COVID-19 had on their business. Another major disruption comes from the payment industry and the various ways a guest can pay for their stay and expenses incurred at a hotel.
Skapinok: AI, voice search, interest rates and a high cost of doing business, as well as competition for labor.
Wood: We expect that Generative AI will have a major impact, but useful adoption is not at the pace predicted.
Zeidan: Today Google, soon automated revenue management (not only automated pricing engines), and potentially GenAI if it is properly adopted.
What is a hotel’s most underrated technology?
Aluri: Automation is often overlooked as a future solution, but the data gained from these platforms can enhance guest experiences, sustainability, and loyalty among younger generations.
Raghavan: Internet access.
Skapinok: Fogless bathroom mirrors. I still don’t know how those things work.
Wood: Frictionless payments.
Zeidan: All-in-one revenue management & marketing systems that own the booking funnel from metasearch, to OTAs, to SEM to the hotel website - down to the booking engine, upsells, and check-out.
What is a hotel’s most overhyped technology?
Aluri: AI is a buzzword often used without understanding its subsets and applications. At its core, AI enables machines to simulate human intelligence. A nuanced understanding of AI subsets and their capabilities is essential for effective utilization.
Holman: Augmented reality (AR) and virtual reality (VR). Hoteliers have many other tech issues that are a higher priority.
Raghavan: Artificial Intelligence in hotels (robots et al).
Skapinok: Smart room controls that nobody can figure out and require a guest to call the front desk to change the temperature or close the blinds in their room.
Wood: CDP's without profile synchronization to core customer systems.
Zeidan: Anything that’s only a small guest-facing widget (versus a holistic system). Hoteliers have too many systems to manage as it stands - adding a new system that does some tiny thing slightly better for a guest is usually negative ROI, especially when you factor in the time & opportunity cost of getting it set up.
Where do you see opportunities for future innovation?
Aluri: Innovation goes beyond creating new solutions from scratch. It involves recontextualizing existing solutions to transform customer experiences and generate valuable data for loyalty programs, personalization, and attracting new generations through design, creativity, and customer value co-creation.
Raghavan: AI integration at places where it makes sense, seamless online interactions for guests, gaming with AI bots.
Skapinok: Revenue management systems that are capable of total revenue and profit management. Some systems say they do this but none of them truly do. We have the data necessary to yield to the individual customer level using factors like predicted lifetime value, but current technology can’t use it.
Wood: Staff-based labor optimization, total revenue management and fully leveraging the huge display in the guest room.
Zeidan: GenAI is a huge opportunity to level up the operations of small independent hotels - which can deliver far leaner operating models, easing the pressure of the challenging labor market and enabling hospitality workers to have more narrow responsibilities that they can succeed at and feel rewarded by (rather than fumbling around in the back-office, while there’s a dirty lobby, or a guest unattended to in the front office).
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