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Powering High-Touch with High-Tech

Technology and the luxury hotel experience may often seem to have an uneasy relationship. Upscale brands pride themselves on high-touch, but the realization has come that this cannot come at the expense of high-tech. Even the most white glove of establishments know that antiquated digital touchpoints can quickly impact a guest’s sentiment and perception of a brand.

Finding balance means that often hotels across segments battle the “just because you can, doesn’t mean you should” war when it comes to the technology available in hospitality. Too much caution or hesitancy, however, results in lags where innovation should be happening. Mobile payments is one example where guest demand (52%) continues to outpace hotel adoption (28%). Another example: More than half of guests (55%) desire guestroom controls, but only 17% of hotels offer that technology.

The outlook is better where the in-room television is concerned. As guests want to use personal devices to watch and stream content, enabling in-room televisions to integrate with mobile devices so guests can access personal content is an initiative that 35% of hotels have taken and an equal number of guests (35%) say they desire this amenity. 

After a sluggish start, hotels are closing the gap somewhat on mobile keys with 41% of guests wanting the capability and 35% of hotels offering it, according to data from Hospitality Technology’s  2018 Customer Engagement Technology Study.

The reality is that today’s guests are digital-first throughout the journey. Gartner predicts that “by 2020, 85% of customer interactions will be managed without a human.” To have machines and artificial intelligence (AI) powering the guest experience, hotels must look at how this hyper-digitization will impact overall IT strategy and infrastructure investment.

With digital touchpoints connecting guests to the enterprise, networks must be nimble enough to flex with fluctuating demands of guests and operations. Shoring up infrastructure to support transformative technology is a key focus for Four Seasons Hotels & Resorts, according to Marco Trecroce, who took the reins of the luxury hospitality company’s IT strategy, eight years ago. As the company’s first CIO, he was brought on board to transform the company with cutting-edge innovation, while maintaining the brand’s signature high-touch service. Trecroce recognized that infrastructure – including robust and consistent Internet globally – was key to support a tech-forward strategy. This groundwork is what would make it possible to implement transformative technology for both guests and associates.

We then were able to use that technology to build out additional applications,” Trecroce told Hospitality Technology for an April 2019 cover story. “Getting the groundwork done allowed us to focus the next five years on delivering more transformative IT initiatives and really moving our digital strategy forward.”

Upscale brands do not feel particularly less confident than peers in other segments, with analytics being the exception; 16% feel innovative, compared to 23% of overall hoteliers.

When asked to compare themselves to competitors in innovative leadership across several different categories, only a quarter (26%) of hotels that fall into the luxury/upscale segment feel they are leaders in customer-facing technology. A greater percentage (42%) are more confident when asked to gauge overall technology leadership compared to competitors.  

Of note is the fact that when comparing these percentages to the total data set from Hospitality Technology’s 2019 Lodging Technology Study, upscale brands are not much less confident than peers in other segment. The greatest lack of innovation assurance is analytics, where 16% of luxury brands feel they are leaders compared to the 23% of the total pool of respondents.

Hoteliers’ top challenges when it comes to technology investment are largely consistent across segment types. Lack of IT budgets and outdated technology architecture take the top two spots overall for both luxury brands specifically but also respondents as a whole. Luxury brands feel stymied by existing infrastructure, placing it third among struggles, compared to seventh for overall hoteliers.

Analytics leaders put the inability to deliver technology projects faster at the top of the list of challenges with 57%, eclipsing the next tier of struggles for the group by a fair margin – lack of budget and effort for systems integration with 36% respectively.

Innovators place the pressure to deliver technology faster as a top challenge tied with lack of sufficient budget. For customer-facing technology innovators, top challenges comprise a three-way split between lack of budget, delivering tech projects faster and the effort required for system integration. This struggle for integration directly correlates to having systems talking to each other and connect to provide a single version of the truth about guests as well as operations.

Property management systems take the bulk of enterprise technology investments with 49% of luxury brands planning to upgrade or change suppliers. Luxury brands are focusing more on upgrading customer experience platforms with 21% putting investment here, compared to only 2% of overall respondents.  

Compared to overall respondents, of which only 2% plan to upgrade business intelligence software, about a quarter (26%) of luxury brands are upgrading BI software. Areas where luxury brands will be making first-time additions identify the need for a better analytics strategy. About one out of eight luxury brands (12%) plan to add predictive analytics software to enterprise system. Tying for third among first-time additions is Internet of Things (IoT) software (7%) and business intelligence software (7%).

Connected systems and devices will offer incredible insight across enterprises, which is why 21% of analytics innovators are planning upgrades here. The amount of data that courses through digital touchpoints is staggering, but also a wealth of knowledge to create the next-level of high-touch experiences. Gartner predicts that by 2040, “more than 40% of all data analytics projects will relate to an aspect of customer experience.” 

Overall hotels are seeing ROI from data analytics and expect more so by 2020. According to the 2018 Customer Engagement Technology Study, 90% of hotels expect analytics to have yielded increased direct bookings and 76% increased sales.

Comparing this to data from HT’s 2018 Customer Engagement Technology Study, 67% of hotels plan to have IoT platforms by 2019, compared to only about a quarter (24%) in 2018.

Not only will connected systems offer incredible insight to guest behaviors, but overall operations as well. The data and insights enabled by IoT can also yield cost-savings for operations.

The upscale market is making major investment in guest WiFi, with 56% of respondents planning changes here. Ensuring robust connectivity will be increasingly important as guests arrive on property demanding strong networks to meet their needs. One such need is the ability to stream content. More than half of luxury brands (56%) are making changes on smart TVs and streaming capabilities.

A second tier of investment in guest-facing technology will also require strong network infrastructure. Interactive digital signage (28%), location-based technology (26%), and tablets (26%) are among those that will enhance experience by providing a self-service option for guests even in a high-touch environment. Voice-enabled devices are receiving more investment from luxury brands with 18% prepared to add these devices for the first time compared to 13% of overall respondents.

  • IN CONCLUSION

    Luxury brands have closed the gap in innovation by putting focus on infrastructure in 2019. To overcome the challenge of maintaining existing infrastructure, hotels are migrating systems above property – including the PMS, with 55% of hotels planning to have that system in the cloud by 2019. Luxury brands are putting the most investment in PMS with upgrades and a focus on WiFi. These investments will create the infrastructure that is needed to support the increasing demands placed on property networks as both customer-facing and enterprise needs become driven by digital.      

Ruckus an ARRIS Company

Ruckus Networks Smart Wi-Fi

Hospitality Networking Solutions

https://www.ruckusnetworks.com

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