New systems to collect and process customer data are necessary to increase the profitability and asset values of hospitality firms, delegates heard during an IHIF panel discussion.
Alex Sogno, CEO, Global Asset Solutions said: “There is a huge opportunity for the big five hotel brands [Marriott, Hilton, IHG, Wyndham, Hyatt] to become more like data banks. If you look at the way they are creating value by putting in flags, it’s very difficult to do, so they started to do franchising. Then if you look at Airbnb, its valuation is much higher than that of hotel companies, so if they shift their mindsets to become data companies, I think there is a bigger success there for their shareholders.”
Pascal Petit, CEO, Thynk.Cloud, added: “Unlike other industries, data in the hotel industry might not yet be seen as part of equity.”
A main driver of repeat business and high guest satisfaction is for guests to be recognised and acknowledged by hotel staff on a personal level. But most hotels are held back in this area by a lack of data.
“There are many issues that we have with the underlying data in the industry at the moment,” said Tristan Gadsby, CEO, Alliants. “First, it’s linked to the primary booker which is a big issue. When you stay as a family, there are potentially five people all under one booking all with very different preferences. Currently the structure of data in the industry doesn’t recognise that. It’s important, because you can use that data to properly tailor the experience and deliver the personalisation that everyone is wanting.”
Facial recognition technology can certainly help with delivering a personal service, Gadsby added, although it comes with data protection issues: “There are hotels we work with that use it. In certain markets, it’s used more than others and it’s also used for security reasons. It certainly helps with recognising the guest, but there is a whole trust conversation that needs to be had.”
Generally speaking, however, Gadsby said that consumers are perfectly willing to provide basic information about themselves such as purpose of trip if there is the promise of a better experience.
RFM is a standard method of estimating the value of a hotel guest based on three data points: recency, frequency, and monetary value.
Although the technology exists to give global hotel chains an accurate picture of a guest’s monetary value, by logging all payments wherever they are made, it is not widely used, said Gadsby: “Brands should be able to provide customers with a single wallet to pay wherever they go within a brand and also with third parties that the brand is dealing with.”
Loyalty programmes have historically been an important vehicle for collecting customer data. But there can be financial downsides for owners, reckoned Sogno, especially for resorts in peak season with large numbers of loyalty members that are unable to leverage higher rates.
This July, Expedia will launch One Key, a consolidation of its three existing rewards programmes. Steve Quan, VP strategic travel partners – lodging, Expedia Group, commented: “It’s brand agnostic. Any trip element, you can leverage points irrespective of brand. We believe it’s an evolutionary approach to loyalty where people will get value.”
Billy Skelli-Cohen, CEO, Zien Group suggested this was another example of OTAs winning the direct booking war. Wasn’t the whole point of hotel loyalty programmes to stop consumers booking with OTAs?
But Quan argued that all participating brands would benefit in Expedia’s new scheme. “The rising tide floats all boats,” he said in reference to the benefits hotels can accrue from access to Expedia’s first-party data.