By Peter Mitham
BELLEVUE, Wash. – Technology has given homeowners the power to be hoteliers, allowing them to host guests in secondary suites and rental properties. But when it comes to dedicated lodging providers, a recent study by Expedia Group has found that smaller properties are unlikely to plan significant investments in technology.
“Chain hotels are nearly twice as likely as small independent properties to prioritize technology investments when asked what they would do with their non-operating capital if they had to pick one thing to bet it all on,” a news release summarizing the findings said. “Alternatively, small independent properties are 1.5 times as likely as chain hotels to prioritize room renovations when asked to select their top priority for capital expenditures outside of keeping the lights on.”
The findings were based on a survey of 1,215 hoteliers Expedia Group conducted this summer. It leveraged its global hotelier panel to compare spending on technology between chain hotels and small independent properties. Chain hotels are classified as properties self-selected as part of a chain affiliation or group of properties with more than 100 rooms, while small independent properties are classified as properties with no chain affiliation and 100 rooms or less.
Abhijit Pal, head of research with lodging partner services for Expedia Group, said the difference in investment choices indicates, “a gap in technology investment strategies and priorities among different hotelier segments.”
The different priorities may mean small hoteliers are missing out on tools that could help them, according to Expedia. While improving the quality of rooms is important, technology can automate many routine functions and boost margins. Digital marketing, guest check-in and payment processing, as well as customer relationship management are among the five most common areas where hoteliers are embracing technology.
The investments aim to boost productivity, improve guest loyalty and encourage repeat traffic. Ironically, these are very often goals targeted by renovations and refurbishments. Beyond this, technology can also help reduce costs by automating basic processes and freeing staff to spend more time improving the guest experience rather than shuffling paper.
This has been the case in other sectors, including agriculture, winery tasting rooms and restaurants. The rise of online ordering from quick-service outlets, which have orders ready for pick-up on arrival is a case in point; integrated sales systems are improving the handle wineries have over their engagement with customers, while enabling them to get a better handle on what’s selling and for how much.
The failure of smaller hoteliers to embrace technology may also contribute to a widening technology gap.
“Technology has the power to level the playing field for hoteliers of all sizes,” Expedia reported. “More than half of the chain hotels prioritize technology that seamlessly integrates with their existing systems.”
A host of new apps have come out that aim to engage smaller property owners and encourage more seamless interactions with an increasingly digital and mobile customer base. The rise of automated check-in, payment and other services are creating new so-called frictionless ways for hoteliers to engage with guests. Expedia believes smaller hotels need to get on board.
“Technology providers in the lodging industry should seek to offer low-cost and basic feature solutions that focus on a frictionless user experience for smaller hotels,” Expedia said, noting that it has invested more than US$1.6 billion in new technology over the past year to match travellers with lodging.
With more than a million listings, many of them small, independent properties, Expedia believes technology can have a value not only for guests for the people who host them.
It says easy-to-use revenue-management, marketing, distribution, and guest-management tools are among the applications its technology investments have supported.