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Hotel Technology Bubble

The Balance Between ROI and Pleasing the Guest

When it comes to new innovation implementations, many hoteliers struggle with making investments that please the guest and yet provide tangible return-on-investment.

There is the perception that the hotel sector is behind when it comes to embracing new innovations. Some experts believe that many brands would rather wait on the sidelines and see a competitor succeed or fail at an implementation – then base their own strategy on these outcomes.

The truth may be that there are more grey areas happening when it comes to this perception. While brands are hearing that they are behind the curve, there are other hoteliers rushing to implement new innovations as a result of a potential hotel technology bubble.

In some ways, hotel brands are investing in technologies that enhance how the guest interacts with the brand. This “please the guest” approach often runs counter to focusing only on innovation ROI. For example, if a new innovation helps build brand loyalty, but does not offer an immediate financial return, is it a viable investment?

This is a challenge that many brands face these days.

It could be possible for brands to embrace both of these concepts: pleasing the guest while also justifying the investment to the C-suite. By leveraging the right outside expertise, and building out testable pilot programs, hotel brands can have both.

Are hoteliers making a mad gold rush-like push to embrace innovation, or are they behind the curve? There are two sides to this story, but with the right approaches, it is possible to please the guest and have real business outcomes.


Are We Living in a Hotel Technology Bubble?

For many of us who lived through the dotcom bubble in the late 1990s, we remember well the heady times experienced, but also the rapid descent into an economic malaise that followed.

Fast forward 15 years later, and it seems that we are potentially on the precipice of a similar situation. Valuations of technology companies and mobile app providers are sky high – Uber is worth $41 billion and Alibaba has a market cap of more than $250 billion.

However, many financial experts point to this trend being more about a shift in tech wealth, as opposed to an actual bubble. Others say that the impact of today’s tech bubble deflating will have a much lesser impact on the economy as a whole this time around.

So, what is going on with the hotel technology sector? Are we seeing a bubble as well?

Based on the recent news that Choice Hotels International is hiring 100 IT specialists for full-time, permanent, high-paying positions; the answer may be “yes.”

Though something different seems to be going on in the hospitality arena: hoteliers are leveraging technologies for PR purposes. Each week, we see a new slew of press releases from hotel brands announcing their new innovations.

The innovation war is all about who can get the most publicity based on the “coolest” new technologies. As we’ve mentioned, offering the hippest innovations does not always translate into meeting the guests’ needs. Do hotel guests really want keyless rooms? Or will a robotic concierge create lasting guest loyalty?

Don’t get us wrong … we think all of these innovations are very interesting, but it is all too easy to choose the latest “shiny object,” which may not be what the guests actually want. Offering a more utility solution that provides a frictionless guest experience may be the best way to go.

By focusing on meeting true guest needs, hotel brands can make the right investments into long-term technologies that provide true return-on-investment (ROI).

While experts believe that a near-future technology downturn won’t be as bad as it was 15 years ago, hotel brands should exercise caution and only focus on pleasing the guest.

If you do this, then everything else will fall into place.