How Digital Technology Continues to Reshape the European Hospitality Experience

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How Digital Technology Continues to Reshape the European Hospitality Experience

10/21/2016
Just like in the United States, European hotels are continuing to see digital technology affect the way the hospitality industry interacts with guests.

“Digital technologies are reshaping the global hospitality industry, and the main challenge for hospitality managers will be to use technologies such as physical and virtual robots, to improve the guest experience," says Michel Rochat, CEO, École hÔteliÈre de Lausanne (EHL). "The hospitality industry will have to embrace the coexistence of high-tech experiences alongside emotional experiences in order to attract and retain customers."

Founded in 1893, Lausanne, Switzerland-based EHL is said to be the first hospitality management school in the world. It has created a professional community of 25,000 hospitality managers, united by its values and legacy.

In an exclusive interview with Hospitality Technology magazine, two professors from EHL, Dr. Hilary Murphy, associate dean of faculty development and full professor, and Ian Millar, project manager METRO innovation chair & senior lecturer, discuss the future of hospitality technology in Europe.

What digital technologies are reshaping the hospitality industry in Europe?
 
Murphy: An increasing number of mergers and acquisitions in the hospitality sector is resulting in an amalgamation of legacy systems, loyalty programs and websites. Big moves such as the 2015 Marriott/Starwood merger — creating the world’s largest hotel chain — are resulting in a major rethink of technologies used in the hospitality industry, with companies assessing which technologies are needed to accomplish their strategic goals.
 
Similarly, with the rise of new booking platforms, such as French global hotel giant Accor’s Fastbooking digital service provider, and Airbnb’s online accommodation marketplace, innovations are constantly being made in the range and choice of booking channels. These innovations are of particular concern for data mining and the ownership of customer data, with Fastbooking providing hotels with lower commission rates and full information on the customer, unlike some online travel agencies (OTAs) and mobile apps.
 
Millar: Hotels are increasingly becoming concerned about monetizing and managing social capital. Most hotels are managing social capital at the corporate level, while enabling properties to engage with customers at the local level. A decrease in loyalty systems and direct booking, and increased developments in data mining are also of concern, along with Payment Card Industry (PCI) compliance and the security issues involved with the upsurge of mobile payments such as Google Wallet, Apple Pay and Bitcoin.
 
Ever more, customers want to be able to book, be recognized and easily share content through their mobiles. As a result, mobile apps, mobile key access and increased digital and social connectivity within the property remain paramount.
 
Why have these technologies in particular had such an impact on Europe's hospitality industry?
 
Murphy: French global hotel giant, Accor is the leading player in the European hospitality industry. Its Fastbooking service presents a challenge for other booking platforms and is bound to cause disruption in the market. However, Europe’s economic and business climate is unique, in that the majority of European hotel properties are independently owned. Independent small and medium hotels find large scale efficiencies and economies of scale and scope difficult to achieve, meaning that their use of technology is determined by cost and practicality.
 
Are these technologies different from what hoteliers in the United States are implementing? If so, why do you think there is a difference?
 
Millar: Yes, as there are differences in European standards and legislation on data privacy. PCI compliance, financial legislation and data handling are somewhat different in the United States.
 
In the European Union (EU), we have data privacy regulations and guidelines in place which give EU citizens legal rights over the data held on them, widely impacting data that is transferred between hotel properties, with compliance being widespread. Conversely, data privacy is not highly regulated in the United States and can vary extensively from state to state. The “Safe Harbor” agreement facilitates data transfer between the EU and the United States.
 
Based on what is happening now in Europe, what do you think could be the "next big thing" for Europe's hospitality industry?
 
Murphy: When it comes to the guest experience, beacon technology will become more widespread, guiding customers around mega-properties and resorts. Gaming will make interactions with hotels more “fun,” with hotels already taking advantage of the PokÉmon Go craze.
 
Millar: When it comes to hotel operations, mobile apps like ALICE, connecting hotel departments and guests, and Virgin Hotel’s LUCY, along with more sophisticated chatbots with artificial intelligence will handle and interact with customers online, whereas robots are likely to take over some operational aspects in hotels, with Hilton Hotels & Resorts currently testing robot concierge "Connie."
 
Additionally, as technology for drones and wearables advances, these will provide options for an enhanced guest experience.
 
The “next big technologies” and their applications will be identified through clever data mining!