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Is Your Hotel Falling Behind? Essential Tech and Skills Upgrades

13 February 2024
Effective marketing, sales, and revenue management strategies are essential for success in the hotel business. Marketing creates awareness and attracts potential guests, sales teams convert interest into bookings, and revenue management goes beyond optimizing room revenue – it aims to maximize the income potential of all hotel offerings. Hotels strive to sell additional products and services, such as food and beverage, spa treatments, and activities.
Many hotels face challenges due to a lack of advanced technology and specialized expertise in these areas. Not only can legacy systems create obstacles in data analysis, but stand-alone systems operating in silos further complicate efforts. Poor integration hinders staff from understanding complex pricing strategies, navigating the latest digital marketing tools, and effectively cross-selling the hotel's complete services. These limitations can prevent hotels from fully unlocking their revenue potential.

Problem #1: The Limitations of a Legacy PMS

Independent hotels relying on a decade-old property management system (PMS) often must overcome a severe barrier to growth and optimization. While the legacy PMS might still technically "work," it likely suffers from critical limitations impacting the hotel's bottom line:
  • Lost Opportunities with Integrations: Modern, cloud-based PMS solutions easily integrate with essential tools like channel managers, revenue management systems, and marketing platforms. A legacy PMS often cannot create these connections, preventing hotels from using a range of innovative, revenue-boosting solutions.
  • Data in a Dungeon: With an older, potentially server-based PMS, the valuable data about your hotel's performance may be locked away and inaccessible. Analyzing trends, forecasting demand, and understanding your guests' preferences become time-consuming and prone to errors, jeopardizing decision-making.
  • Cumbersome User Experience: Legacy PMS systems are often complex, with slow and outdated interfaces. Staff spend excessive time on workarounds and manual tasks due to inefficiency. This frustration detracts from the guest experience and creates bottlenecks in operation.
  • The Hidden Costs of "If It Ain't Broke": While clinging to an outdated PMS might seem to save money in the short term, it creates hidden costs. Missed revenue due to lack of optimization, lost staff productivity, and potential for poor guest experiences due to slow service can all chip away at your bottom line.

Solution: Upgrading to a Modern, Cloud-Based PMS (and beyond)

Embracing a modern, cloud-based PMS represents a leap forward in functionality, ease of use, and scalability. The proper PMS acts as the central nervous system for your hotel, enabling powerful capabilities and integrations:
  • Open Ecosystem: Integrate with revenue management systems, dynamic pricing tools, CRMs, and various marketing platforms to streamline operations and boost revenue.
  • Data at Your Fingertips: Cloud-based solutions provide accessibility to comprehensive, real-time data, empowering you to understand performance metrics, track trends, and react quickly to shifting market conditions.
  • Intuitive Design: Modern platforms offer user-friendly interfaces, minimize staff training time, promote guest-centric workflows, and reduce frustrations.
  • Beyond the Core: Many modern PMS providers offer integrated or compatible solutions for point-of-sale (POS) systems, meeting & events management, and more. This consolidates operations and provides a seamless flow of data across all departments.

Problem #2: Skill Shortages

Beyond technological limitations, many hotels, especially in the independent sector, are grappling with a shortage of highly skilled professionals in crucial areas like revenue management and digital marketing. Here's why this talent gap matters:
  • Revenue Management Expertise: Revenue management has become increasingly sophisticated, demanding specialized knowledge of data analysis, pricing strategies, and competitor forecasting. Many hotels lack in-house talent and the necessary experience to optimize their revenue potential fully.
  • Digital Marketing Specialists: The digital marketing landscape is constantly evolving, with new platforms, tactics, and algorithms emerging constantly. Without in-house specialists who understand the unique needs of hospitality marketing, hotels may struggle to maintain an effective online presence, target the right audiences, and drive direct bookings.
  • Impact on Adaptability: The talent shortage disadvantages hotels in dynamic market conditions. Without staff with expertise in digital marketing and revenue management, hotels often lack the agility to modify strategies quickly based on demand shifts, competitor behavior, and unexpected economic factors.

Solution: A Two-Pronged Approach (with an Outsourcing Option)

Hoteliers must employ a multifaceted strategy to address skill shortages and create a future-proof workforce:
  1. Upskilling Current Staff: Prioritize investing in staff development and create a culture of continuous learning. Provide opportunities for employees to attend industry conferences and workshops and access online training resources focused on revenue management and digital marketing strategies. These can be tailored to different employee roles, helping everyone contribute to optimal strategy.
  2. Strategic Hiring: Revamp your recruiting approach to attract individuals with a rare combination of hospitality experience, data-driven mindset, and digital marketing know-how. Develop partnerships with hospitality programs at universities and colleges to build a pipeline of potential talent. When filling crucial roles, prioritize skills and potential even if new hires require industry-specific training.
  3. Outsourcing Expertise: For hotels facing severe skill shortages, outsourcing specialized functions to industry experts can be a solution. Partnering with agencies or consultants focusing on revenue management or digital marketing ensures immediate access to top-tier professionals. Outsourcing requires a commitment from the hotel to provide open access to data and adopt the modern systems necessary for optimal collaboration.

Problem #3: Data Inaccessibility and Quality Issues

Hotels may think they have access to data but often face an equally insidious problem: fragmented, incomplete, and incorrect data that renders insights almost useless. Multiple factors contribute to this problem:
  • Incomplete and Inaccurate Data Entry: In the often stressful, front-line hotel environment, errors occur regularly during reservation and check-in. Staff may capture incorrect contact information, misspell names, or misclassify guests. This flawed input directly impacts data quality and the value of subsequent marketing.
  • Limited System Integrations: Even when guest information is gathered with care, a lack of streamlined data flows creates significant obstacles. Systems for the property management system (PMS), website booking engine, POS (for restaurants or other amenities), and event management can all operate in isolation. Manually transferring or replicating data introduces the potential for mistakes, lost information, and a disjointed understanding of the guest experience.
  • Consequences of Poor Data Quality: Inaccurate and incomplete data erodes decision-making ability. It restricts the potential of targeted marketing campaigns, hampers personalized service, leads to faulty demand forecasting, and ultimately inhibits strategic decision-making for optimizing revenue across all hotel segments.

Solution: Promoting Data Ownership and Seamless Integration

Hotels must tackle the data problem head-on with focused strategies promoting both ownership and seamless data flows:
  • Centralized Data Platform: A centralized platform should collect information from the PMS, POS, and other relevant systems. This creates a single point of truth about guests, transactions, and overall hotel performance.
  • Focus on Data Quality: Establish internal standards and data entry rules, emphasizing the importance of meticulousness at every stage of the guest journey. Regular data audits and cleansing processes contribute to maintaining a "clean" dataset.
  • Emphasis on Open Integrations: Prioritize PMS and technology solutions, prioritizing open APIs that facilitate smooth data transfer between systems. This reduces manual errors and ensures consistency across platforms used by your staff.
  • Staff Training & Accountability: Invest in staff training to understand the importance of data integrity and their role in contributing to this effort. Clear performance goals linked to data input accuracy help improve awareness and accountability.
  • Outsourcing with Caution: Data ownership is paramount for hotels venturing into outsourcing. Contractual agreements must include specific clauses that ensure full access to all hotel-related data the outsourcing partner utilizes. The contract should have provisions outlining the apparent return of all data should the relationship be terminated, thus protecting your hotel's intellectual property and ability to leverage past insights.

Take Immediate Action

In today's dynamic hospitality landscape, addressing technological limitations and skill gaps isn't merely a suggestion – it's a matter of survival and long-term success. To compete and thrive, hotels must:
  • Embrace Modern Technology: Invest in cloud-based platforms, robust PMS solutions, and tools focused on revenue management, marketing automation, and data analytics.
  • Prioritize Data as an Asset: Adopt a centralized approach to data, ensuring quality and accessibility and extracting actionable insights for informed decision-making.
  • Build a Team for the Future: Cultivate current talent through continuous learning opportunities while strategically adding new hires with a unique mix of digital savvy and hospitality acumen.
Hotels that proactively act today can unlock opportunities for increased revenue, optimized operations, and enhanced guest experiences in the competitive market.
Are you ready to take control of your hotel's future? Consider your current technology roadmap and areas where further investment can make a difference. Even small steps forward will set you on a path to lasting success.