After one of the toughest years in history for the entire leisure, hospitality, and travel industry, businesses are starting to see the light at the end of the tunnel. In early July 2021, the number of US daily flights was down just 9% on 2019 levels. Over the Memorial Day weekend, US hotels achieved their highest occupancy rates since the beginning of the pandemic. Executives from leading hotel chains have spoken about the pent-up demand they are seeing from people who want to go out, travel, and stay in hotels and resorts again. However, we’re still in for a time of uncertainty, and the path to full recovery is likely to be rocky.
It’s during this time of gradual return to normal that there are new opportunities for hotels to reflect on, and if necessary, to rebuild and reinvent how they are creating guest experiences. And more specifically, how they are using modern marketing and sales channels to better interact with people, and in turn, maximize revenue.
In this article, we’ll explore three key ways leading hotels and the hospitality industry are starting to reconsider their strategies.
- Rethink your revenue diet – It’s time to move to direct digital sales
Historically, many businesses have suffered from reduced margins as they relied on online travel agencies, such as Expedia and Booking.com. In Europe, as of 2019, nearly a third of overnight hotel bookings were made via online booking agencies. While such agencies will always remain a key part of the revenue mix, with the advances in targeting made possible via direct digital sales, businesses can reclaim a significant portion of this revenue. They will also enjoy having a direct relationship with the customer, directly managing the experience they receive, rather than relying on a third party. We’ve seen this in the cruise industry, where traditionally many passengers booked their trips via an agency – the cruise firm often then lacked many key passenger details, limiting their ability to offer more personalized services. Having a direct relationship opens the door to much greater personalization, leading to a better experience, resulting in greater customer loyalty.
What you can do: To offer a truly omnichannel experience to guests, one crucial step is to transform your lead management and digital ad campaigns. Investigate techniques such as advanced call tracking which can contribute to improved conversion rates in your call centers. Different ad campaigns can have a different number assigned to them, making it possible to link a digital ad to a resulting phone call and conversion. Your call agents will also have insight into where the call is coming from, enabling them to offer a more personalized service.
- Cross and up-sell using zero and first-party data and knowledge of your customers
The use of technology as part of the guest experience can create memorable and seamless moments that people enjoy using. Think of the Disney Magic Band, which people can use for everything from entering the theme park, making payments, to bypassing reception at the hotel and going straight to their room. Similarly, Hilton’s app enables guests to choose their room, based on a layout of a hotel, and also provides a digital key to provide a seamless digital experience. The app syncs with loyalty points, so people can not just check what level they are at, but also access special benefits. There’s also greater personalization – for example, using a combination of zero and first-party data, a hotel can know that the guest is a 27-year-old that has reserved the room for their honeymoon, and know their favorite food and wine. Digital services make it easier to offer customers in-app offers – everything from seeing the exact layout of their room and offering an upgrade, to offering someone a glass of their favorite wine an hour before they have reserved a table in the hotel restaurant.
What you can do: The greater ease of offering such digital guest options helps maximize revenue per available room (RevPAR) and average revenue per user/account (ARPU/ARPA). Meanwhile, such experiences are not only great for the customer, but also generate a significant amount of data. Organizations can turn this data into insights to generate new business opportunities, as well as cross and up-selling opportunities. Put simply, digitized guest knowledge enables instant personalization and offers before, during, and after a person’s stay.
- Hotels need a broader digital reinvention to stay on top of changing guest demands
While building an industry-leading mobile application is a key element to augmenting your guests’ experiences, on its own it’s not enough. Every department area needs to be evaluating and making key decisions related to everything from technology architecture, and media investment to phygital experiences design. For example, by improving tracking, analytics, and investment recommendations with marketing technologies, it’s possible to significantly increase return on investment for marketing budgets.
What you can do: As a first step, to identify future areas of improvement and to guide your digital transformation, focus on making sure all the data you are collecting is accessible and can be used throughout your organization. This means making sure there is quality data, in usable formats, and is relevant for people’s specific roles. This achieves two key objectives: 1) Enhanced collaboration between traditionally siloed areas, and 2) Opportunities for predictive modeling, increasing predictability and forecasting. For example, data and business intelligence teams can empower their marketing colleagues with more tools and knowledge for media investment decisions, which translate into better digital sales results.
Digital marketing and sales efforts need to go beyond their traditional, limited remits. Going forward, they are becoming intimately linked to everything from the customer experience to the physical design and layout of venues. To do so successfully will mean implementing modern data management practices, which both provide the appropriate data for you to offer new experiences, while also being transparent to patrons and guests about exactly how you are collecting and using their information. Data management, however, is complex and difficult – in many cases, it will be necessary to look to expert partners for guidance and support.
If you would like to find out more about how Globant’s Digital Sales Studio can help you blend data and technology to achieve your growth objectives, don’t hesitate to get in touch with us.