Seven trending hotel news stories that will impact your hotel Revenue Strategy.
1. Data science is key to building guest loyalty
In the future data scientists will be the ones who shape the success of many business sectors, including travel industry loyalty. According to the author, travel companies need to be able to gather customer data from as many sources as possible and then aggregate it in a form that can provide a clear picture of the customer journey.
Once a hotel or hotel company has a cache of clear, consistent data, they can deploy a number of strategies that build loyalty:
- Use this view of customers to better understand what perks frequent travelers actually want;
- Encourage loyalty club members to redeem their points and accrue additional credits;
- Leverage a deep understanding of current customers to find like-minded prospects through content and advertising partnerships.
2. Building loyalty goes well beyond points
According to new data from Kalibri Labs, an increasing percentage of hotel bookings are done by members of hotel loyalty programs. And while discounts offered to loyalty members is driving some of those bookings, hotels need to offer other things to continue the trend, says study author Cindy Estis Green.
To build on this momentum, hotels must offer services and conveniences that provide a more seamless hotel experience for guests. Today, that includes technologies like mobile check-in and keyless entry, but in the future hotels will need to broaden their offerings to satisfy their most loyal customers. Experiential travel is one example, but it all leads back to providing seamless and hassle-free hotel experiences for travelers.
3. Microsoft aims to be AI-assisted travel middleman
Microsoft wants to get into the middle of the travel funnel, perhaps as a replacement for Google. The software giant is betting on artificial intelligence-assisted voiceware to be its connector between travelers and travel suppliers, including hotels.
Microsoft believes mobile apps will become passé once consumers become more comfortable with voice-activated Internet sites, such as Siri, Alexa or its own Cortana. The company admits it has work to do before (and if) it can become a major component of the very-important, and potentially profitable travel funnel.
4. Personalization is key to effective hotel apps
Executives at Marriott International and Wyndham Hotel Group agree it is personalization, not one-size-fits-all that is the key to successful mobile apps in the hotel sector. Why is this important? Apps, on average, lose 75% of daily active users within 90 days of being installed, so content must be compelling but not overwhelming.
Some app building tips from these executives:
- Apps needs to take users through the entire hotel journey: from planning to booking to in-house to post-stay.
- Messaging to users must be relevant and simple.
- Delivering personalized content involves gathering audience data, loyalty data and DMP data and tying them together.
- Effective use of apps can create strong customer loyalty.
5. A lot of Chinese are going digital to book travel
The Chinese are increasingly becoming digital travelers. According to new data, digital travel sales in China will total $109.4 billion in 2017, up 20.6% over the previous year. What’s more impressive is the fact that in 2016, 299 million Internet users in China made a digital travel reservation. That’s up from 260 million who did so in 2016.
Flight ticket reservations will account for 56% of the online travel market this year in China, with hotel booking making up 19%. A potential marketing issue for hotel marketers and revenue managers is the fact that both airline and hotel bookings account for a diminishing share of online travel sales, largely because travelers are moving toward more comprehensive travel services.
6. Why business travelers don’t like Airbnb
Above all, business travelers want consistency in their hotel stays. They must trust that their accommodations will always have the amenities and services they need, expect and can’t travel without—things as simple as simple as a coffeemaker or as complicated as food and drink.
Luckily for hotels is the fact that Airbnb and other sharing economy sites can’t guarantee these consistencies across the millions of its accommodations offerings. As a result, business travelers—except perhaps millennials and the adventuresome—are not booking Airbnb in large numbers.
7. An argument for OTAs, against direct booking
According to the author, hotel owners and their revenue managers should quit griping about online travel agencies and appreciate all the great things they do for them. He offers several reasons why OTAs “provide hotels with a cost-effective way to generate incremental bookings in a highly competitive market, all on a pay-per-performance basis.”
- OTAs spend billions of dollars every year on sales and marketing, which drives brand-agnostic travelers to hotels;
- They also spend more money than hotels or brand companies could on cutting-edge technology;
- The economics of distribution mean only big OTAs with big budgets and healthy commission rates can survive;
- Commissions are “gradually and consistently” coming down, so OTAs aren’t really making that much profit; and
- All in all, they provide a really good value for hotels.
Stay up on hotel Revenue Strategy news and discuss industry tech trends in the Hotel Revenue Strategy Leaders Group on LinkedIn.
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Tags: Airbnb, alexa, artificial intelligence, Cindy Estis Green, cortana, Duetto, guest loyalty, hotel distribution, hotel pricing, Hotel Revenue Management, hotel revenue strategy, hotel sales and marketing, hotel technology, hotel yielding, Kalibri Labs, Marriott International, RMS, siri, Wyndham Hotel Group