Many hoteliers are still finding they could do better with negotiating technology. Perhaps it’s because technology is outside their main skillset, or perhaps it’s because mastering technology is an unattainable goal; the moment something is figured out a new technological wrinkle comes to light.
Either way it’s a complication keeping hoteliers from maximizing their financial potential by fully leveraging technology. But that’s changing as IT professionals in the hospitality sphere are getting bigger budgets and the ability to make proactive decisions that lead to fatter profits. But there is still work to be done, according to attendees of BITAC® Tech & Ops held earlier this month held in Memphis.
BITAC® is of course the industry leading one-on-one meetings and relationship building event. This month marks the 48th BITAC® meeting, which is attracted lodging executive elite representing leading and forward thinking companies. And they’re all here to come together at BITAC® to problem solve, network, sign deals and exchange ideas to move forward the quality of experiences for hotel guests, while adding profits to the bottom line. There’s even time to cut loose, be social and network in a luxurious and relaxed environment.
When BITAC® attendees were asked in a real time poll, not even 20 percent of attendees responded they are fully leveraging technology to lower operational costs in your hotel. Just 18.8 percent felt they were. Another 53.6 percent felt they could do a better job while 13 percent said they don’t have the budget to make their tech dreams a reality. And a full 14.5 percent felt they could do more yet were no sure how.
With numbers like these that means there’s still a lot of upside potential to technological investments that can help boost the bottom line. And with the industry soaring to new heights it’s great to see that more opportunity still exists. Plus as new tools are developed hoteliers will see even more sophisticated possibilities.
“We do very nicely, but there are always places to continue to do a better job leveraging technology,” said Jason Shane, Director of Information Technology with Hersha Hospitality Management.
Shane said during a panel discussion the company has been focusing on guestroom technology during the past two years to enhance the stay experience and are “dropping as much fiber optic cable as we can,” in the hopes they can future proof room for at least five years.
Tom Mayer, President of HCS believes part of the problem is owners will not make a big investment in technology if they plan to sell the property. “Hoteliers don’t take advantage of new technology if they already plan to sell a hotel. They look at what will save money short term, not for how much more they can sell the hotel for in the long run,” said Mayer.
One truism we uncovered about reaching the technological panacea has to do with the struggle of who actually owns or possesses customer data. It’s an issue that has yet to be completely worked out and Colin Findley, VP Business Development with ProfitSword said it puts hotel owners at a disadvantage.
“Not every company is making it easy for the interface of data. They are charging clients to retrieve their own data,” said Findley.
One place technology is having the right effect is revenue management. When attendees were asked “By what percent has revenue management helped enhance your hotel’s bottom line during the past year?” just 3.4 percent said the difference was less than five percent increase in rate enhancement. The most respondents (43.1 percent) said they are seeing rate gains between 10 to 15 percent while 34.5 percent said their gains are between five and nine percent. An amazing 19 percent are seeing rates rise by 16 percent or more.
Other questions posed to the audience included:
What area of the hotel do you think needs the biggest technology injection?
Revenue management - 16.3%
F&B - 7.5%
Guest focused technology - 53.8%
Hotel systems such as HVAC - 13.8%
Reservations and marketing - 8.8%
Where do you see your hotel getting the best bang for your Back of House technology investment?
F&B operations - 6.5%
In the guestroom - 35.5%
Analytical Tools - 43.5%
General process improvement like accounting systems -14.5%
Other amenities such as spa - 0.0%