Let’s take a look at what hotel digitalisation means exactly and how the right tools can help you run a more efficient and profitable hotel.
What is digitalisation?
According to Gartner, digitalisation is the use of digital technologies to change business models and create new revenue and value-producing opportunities. In other words, it’s the process of converting your hotel’s internal processes and revenue management models so that all the information that you handle can be collected, stored, and processed through a centralised computer system. That way, you can better manage your data, streamline your workflows, and make informed, data-driven decisions about your business.
Although the shift to digitalisation has been coming for some time now, the pandemic has encouraged many hoteliers to speed up the digital transformation of their data. In fact, according to a recent study by McKinsey, the COVID-19 crisis has accelerated the global digitalisation of customer and supply-chain interactions and internal operations by three to four years. And the hotel industry is no exception. In order to stay relevant and profitable, businesses need to adapt their strategies and practices in line with the changing nature of consumer demand.
How can digitalisation boost profits?
There are a number of ways that digitalisation can help you create a more efficient business model for your hotel and boost your profits. Generally speaking, most hotels are currently focusing on tools that help them improve two major areas of their business.
The first of these is the digitalisation of the guest experience. This includes the use of in-house communication apps for communicating with guests, and technology for digitising various touchpoints during the guest timeline, such as offering online check-in and check-out solutions.
The second area is the digitalisation of a hotel’s internal processes. This area is more focused on streamlining the way internal data is managed and processed. And one of the biggest benefits of this is that it provides revenue managers with better access to data analytics. This enables them to understand their guests better and make strategic changes in line with consumer demand and market trends.
Let’s take a look at these areas in a bit more detail to help you understand how digitalisation can help you create an efficient and profitable business.
Data collection and analysis
Digitalisation makes it much easier to collect, manage and analyse data. For example, when you digitalise your booking process, you can centralise all your guest data in one system. That way, all areas of your hotel have access to the information they need at the click of a button. For example, you can share this information in real time with your housekeeping and restaurant teams so that they can prepare supplies and plan employee schedules accordingly. All this helps your internal operations run more smoothly so that you can create a more productive business model for your hotel.
By using the right AI tools and technology to analyse this data, you can also offer an improved guestexperience. For example, guests can check into their rooms in advance instead of queuing up at your desk on arrival. They can also communicate their requirements and preferences in advance so that you are able to tailor their reservation accordingly. And the next time they make a reservation, you just need to access their digital guest file to find out everything you need to know.
Description of the situation
Digitalisation also helps you better understand your current performance levels in line with the market in which you are operating. You can use digital technology, for example, to see how many guests leave you a positive review. You can also identify if there are any areas of your hotel that are underperforming so that you can improve your guest experience. Plus, you can compare your performance data with that of your competitors to measure the impact that your current strategy is having on your hotel’s reputation.
Essentially, digitising and centralising all your data makes it easier for you to paint a picture of how smoothly your operations are running and whether you are meeting your objectives as a business. And all this helps you identify what changes you need to make to your revenue management strategy in order to boost profits.
Because digitalisation enables you to consolidate all your business intelligence data, it’s much easier to predict patterns and fluctuations in demand. For example, you can analyse your historical data in order to make informed predictions about what your occupancy levels are likely to be at any given point in time (taking into account sales conditions, segmentation strategies, trend deviations, lead time, and market fluctuations). You can then use your predictive analytics to adjust your pricing strategies and inventory accordingly.
For example, BEONx’s revenue management software combines a range of Artificial Intelligence technologies that can help you detect changes in consumer behaviour and automatically implement adjustments to your rates, inventory, and operations in line with demand trends.
Finally, the right digitalisation tools should help you break down silos and identify prescriptive recommendations that maximise your ROI.
For example, you can use a revenue management system to collect and analyse valuable metrics so that you understand your past, present and future performance. This includes data relating to guests, such as their booking habits and behaviours. It also includes the prices that tend to attract specific segments of the market and the feedback you get from your guests. Plus, an RM system gives you access to valuable market data, including demand fluctuations, booking trends, and what your competitors are offering. You can then use this data to analyse your market and competitors, predict future demand, improve your hotel market positioning, and optimise your rates.Essentially, the biggest benefit of digitalisation is that it enables you to create an automated, integrated hotel tech stack that gives you real-time access to every aspect of your business. And achieving this level of visibility is the best strategy for streamlining your operations and generating maximum profit for your hotel.