Kokua Hospitality is a boutique hotel management company with an emphasis on the spirit of West Coast hospitality, loyalty, innovation, and how to tell whether new tech is worth the higher price tag – especially when the future of technology is moving away from an “in your face” approach. Here, Kirk Pederson, president of Kokua Hospitality, discusses how technology is changing and some of the frustrations present between management companies and brands when it comes to implementing new technology.
HT: You’ve said before that technology is moving away from an “in your face” approach. What you mean by that and tell us why you think it’s occurring?
PEDERSON: People want their technology to be seamless. Simply bragging about how great you are technologically doesn’t get you mileage with guests. Let’s talk mirroring a device on a TV, for instance. If it’s easy to connect your phone and your accounts and actually feel like you’re getting the experience you’d get in your own homes (or better) – that’s what a guest wants. They don’t want to have to do more work for a lesser experience. It’s also about what is expected. Take keyless entry into a room. That’s no longer a novelty and in three years, it’s going to be expected at every hotel. And there’s no worming your way out of that kind of technological advancement in hospitality.
HT: As the industry becomes more advanced and diverse, are these technologies more likely to start building upon one another rather than replacing each other?
PEDERSON: That’s definitely part of it. Consider the phenomenon a few years back of Marriott offering free Wi-Fi and how impactful that was. Now, in 2019, you might not be driving business with your free Wi-Fi amenity, but you will be losing business if you don’t have it. Because of that, hotels have to consider things that have been a seemingly permanent structure in guest rooms for a long time. Things like cable are going to be obsolete in hotel rooms in the near future, so we always need to figure out what comes next. There’s always going to be a different way to do things, and we might not know what it is before everyone else, but the one thing that isn’t going to change is that it’s going to cost money. If we want to be on top of the game and be the first to invest in the next big thing, we need to start analyzing our FFE dollars and where they’re going. Even with a rapidly changing sector like technology, it’s about the long game.
HT: What is the most important thing owners should know when deciding to invest in long-term technology funds or policies?
PEDERSON: Owners typically don’t reserve money long-term investments. Instead, they typically reserve money for brick & mortar renovations, but technology provides a better guest experience. It changes how you interact with things. It also streamlines costs on the operations end. There are new companies every day that are finding ways to book people into rooms without a front desk. Their money is going towards marketing and technology – and the technology isn’t cheap, but it is cool and it is working. It’s hard to prove the ROI to an owner; it’s hard for them to put that money up front, but we can see it working in a variety of hotels every day.
Plus, hotel owners should keep in mind that service is different than it used to be. The expectations of service are different among consumers. As an industry, we will continue to argue whether or not the consumer really wants to talk to a person at the front desk? Maybe some do. But almost everyone under thirty is looking for a different hotel experience that goes way beyond just deciding if an entire generation wants to talk to a hotel representative or not.
HT: Can you tell us about a recent hotel technology decision or purchase that ended up being a huge success?
PEDERSON: We’ve started working with a few smaller hotels that were still doing revenue management in Excel sheets. We came in with some technology to help streamline that process and, on a basic level, things have gotten better. Having access to data that can be sliced and diced in multiple ways – that’s really valuable. I can’t really argue that one system is better than another. Even Hyatt’s implementation of a new revenue management software a few years ago is lightyears ahead of what other brands are just catching up to now and they’re doing better for it. Brands will continue to invest there – and for independent brands, it’s even more of an investment. The cost is the same, but it’s more difficult to eat that cost on the front end, even though those programs work. Tools that help us analyze our businesses are invaluable.
HT: Does your position as a third-party management company allow you to investigate different or newer technology since you aren’t held to brand standards? What are the benefits of this?
PEDERSON: Absolutely. One of the main benefits is that we get to work with all the different systems and that’s huge.
For example, we get to work with all the booking engines including, brand booking engines and independent booking engines. We know which ones are good and where others need some improvement. We've learned which have a direct connect to a channel manager and which ones require you to put in reservations manually because they don’t have a direct connect. This knowledge has allowed us to have an overarching view of what works and what doesn’t and make changes accordingly. Even better, we can put that knowledge to work when an owner contacts us and asks if we have worked with a particular booking engine. When they ask us for our thoughts on a particular product, we can offer our expert knowledge.
HT: What is the greatest technological investment you’ve seen in hotels so far?
PEDERSON: The ease of booking. A good booking engine now offers mobile booking and the fewest number of clicks to book a room. People don’t mind having their credit card on file if they’re getting trusted, efficient service. And that technology has been invaluable when it comes to booking a hotel room because people want easy, seamless technology. That’s using technology for purpose.