All posts by Monique Manning

Most Important KPIs for Hotels

If you avoided a speeding ticket on your way to work this morning and managed not to run out of gas, thank your KPIs. In the same way that a speedometer and gas gauge helped you reach your destination on time, key performance indicators can help hotels and resorts measure their progress and stay on track with their revenue and profit goals.

Hotels that have real-time data at their fingertips can make informed, data-driven decisions that affect their bottom line, from identifying peak seasons and optimal staffing levels to executing marketing and sales campaigns that fill their rooms.Hotels that don’t have quick access to critical KPIs will be less likely to operate at optimal efficiency and maximum profit. Without it, they will find it harder to see around the corner and will be less equipped to exploit opportunities and manage threats.

It should not feel like managers are drowning in data or wasting time sifting through reams of reports. Streamline your data by identifying the four or five key metrics that will define success for your hotel, and ensure that you receive updates on those KPIs on a daily, weekly, and monthly basis. Each KPI should have a specific quota and goal associated with it, otherwise, there is no way to measure how well you are performing. The quota is defined as the lowest number acceptable and the goal is the number your hotel is aiming for. Set an alarm so you receive an alert if your KPIs go under or over a certain level.

The good news is that tracking your KPIs in real-time isn’t as much work as you might think—if you have the right system in place. Cloud-based hotel property management systems like StayNTouch are leveling the playing field and enabling hotels of all sizes to simplify and automate their KPIs and other business intelligence capabilities.

While there are many ways to measure your hotel’s performance, there are four KPIs that we believe are essential for hotels to track:

1. Average Daily Rate (ADR)

The Average Daily Rate, or ADR, is perhaps the best-known way of gauging performance in the hotel industry. This metric is straightforward – it’s the average price that your guests paid per room on any given day. This data point can be revealing by itself as an indication of how the hotel is doing on a daily basis, or it can be used to discern patterns and trends over a specific period of time.

Calculating ADR is easy. Simply divide Total Room Revenue by Total Rooms Occupied (excluding complimentary rooms). Once you have sound baseline data, you can compare your hotel’s performance with your competitors and make strategic decisions that increase your ADR and drive your hotel’s bottom line. Analyze it to see how it compares to the same day in the previous year and versus your three-month average.

Knowing your ADR allows you to make midcourse adjustments as needed. Determine the minimum ADR you need in order to be profitable and monitor it so you know if and when it drops below that point. If you have a high occupancy rate combined with a lower ADR, a correction may be needed. Consider the common strategy to discount room rates to increase a hotel’s occupancy rate—at a certain point, this can become a revenue loser. ADR analysis tells you when to hit the brakes.

Knowing your ADR also helps you evaluate and hone your business and sales strategy. Your marketing team might undertake a campaign to increase your baseline ADR by attracting higher-end guests and ensuring that more of your premium-priced rooms are occupied. You will want to test how your ADR is affected by different pricing strategies, cross-selling and up-selling opportunities, and the use of online travel agencies like Expedia.

2. Occupancy rate

How does your hotel perform over different time periods and seasons? Why are there times when it is packed to the brim and other times when it may feel more like a ghost town? Do you need to adjust your Average Daily Rate to increase demand? It’s nearly impossible to answer these and other important questions without knowing your hotel’s occupancy rate. In fact, many hotel executives will tell you that it’s the most critical data point, not to mention the easiest to calculate. Your hotel’s occupancy rate – the percentage of available rooms occupied over a specific period of time – is calculated by dividing the number of rooms occupied by the number of rooms available.

Your occupancy percentage reflects how filled your hotel is. Determine the minimum level of occupancy that ensures profitability and, if you dip below that number, diagnose the issue and take action in real time. Keep in mind that, while a high occupancy rate is of course preferable to a lower rate, it is not the ultimate goal; maximizing revenue and profit is. Enhance your hotel’s occupancy rate by instituting loyalty and rewards programs, offering seasonal hotel packages, and offering last-minute specials that appeal to the more spontaneous millennials.

3. Revenue per Available Room

Revenue Per Available Room, or RevPAR for short, is considered by many hotel executives to be the go-to metric for quickly evaluating the financial performance of their hotel, in particular, how effective they have been in filling rooms and maximizing profit. RevPAR reflects how well the Average Daily Rate is doing in terms of attracting guests to the hotel and meeting target occupancy goals, and how this compares with its competitors. RevPAR reflects the average revenue you’re getting out of each room, not just those that are occupied. In an ideal scenario, this number would be equivalent to your occupancy rate, signifying that every available room is filled.

There are a couple of ways to calculate it: Take your occupancy rate and multiply it by your ADR, or divide total room revenue by the total number of available hotel rooms in the period of time that you are measuring.

A high RevPAR score is correlated with a high occupancy rate and ADR and is used by hotels to plan both high and low seasons. One thing to remember is that your RevPAR score reflects revenue, not profit. This means you must use it along with other metrics – such as cost and expense reports – to get a comprehensive picture of your hotel’s true performance. Try improving your hotel or resort’s RevPAR score by increasing Average Length of Stay (ALOS) and increasing cancellation fees in order to reduce last-minute cancellations. 

4. Online Rating (Customer Satisfaction Rating)

The previous metrics we explored were quantitative and revenue focused. Now we are going to review how to measure something more subjective and personal, but just as important. Your customer satisfaction rate speaks to how well customers are being served at all touchpoints. The Customer Satisfaction Rating depends on your hotel’s ability to encourage your guests to complete brief surveys or fill out feedback forms. The feedback that hotels receive, while not always positive, is always valuable because it reveals gaps in customer service that management needs to address through corrective action as well as strengths to build on.

That said, motivating guests to take the time to review their stay can be a challenge; directing front desk staff to ask departing guests to fill out a survey card is as uncomfortable for them as it is for the guest. Fortunately, this process can be automated with cloud-based technology like StayNTouch’s hotel property management system, which can automatically send out surveys a few hours after guests complete their stay at your hotel.

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A common issue for hotel managers is how to integrate KPIs into their time-strapped workday. Where do you find the time to review all that data? When it comes to KPIs, it’s important to remember that less is more. Streamline your data so you track only your most critical KPIs, such as the four featured in this blog post.

With the technology that is available today, monitoring and analyzing your KPIs has never been easier.All it really takes is setting aside ten minutes every day for you to assess and analyze the data for potential opportunities and risks. With access to real-time KPIs, hotels and resorts of all sizes can now engage in evidence-based decision making that captures more revenue, reduces costs, and maximizes profit.

Resources:

Top Hospitality Trends of 2019 (So Far!)

Now that we’re just past the year’s halfway mark, it’s a great opportunity to take a look at the hospitality industry from a bird’s eye perspective. What are the trends and new ways of conducting business that are defining 2019?

Technology encompasses and cuts across all aspects of hospitality, from operations and marketing to customer service and in-room design. While technology is not a specific trend, it is the main driver behind most, if not all, of the trends that are transforming the hospitality industry. With that said, the following are five key trends that are experiencing serious momentum in 2019 and are fundamentally changing not only how hotels and resorts compete for guests but also how they turn them into loyal and enthusiastic ambassadors.

Top 5 Trends in 2019

1. Niche markets 

This year the hospitality industry is realizing that size does matter. Increasingly, hotel guests are drawn to hotels that cater to specific audiences with unique wants and needs. Hotels are cultivating their brands and are defining themselves by the niche audiences they attract. Some are highlighting their eco-friendly features or culinary expertise, while others integrate music or art into their environs and offerings. Other hotels are marketing themselves to adventure and experience seekers, to the LGBT community, or to families that have been affected by autism. Perhaps most prevalent of all is the rise of hotels that are reorienting, and sometimes remodeling, their lobbies and rooms to appeal to millennials, the two billion consumers across the globe. Born between 1981 and 1997, they are driving many of the technological and experiential trends we are seeing in the hospitality sector.

2. Mobile services 

In 2019, more hotels and resorts are heeding the call from a Google study that indicated that when guests go online to plan a trip, they spend 87 percent of that time on a mobile device. As a result, hotels are working to ensure that their websites and booking engines are optimized for mobile-centered customers for all stages of the journey, from planning to booking. Priority areas of focus include speed, navigation ease, and quality content.

Hotels are also using their mobile websites to target spontaneous travelers with last-minute offers. Recent data underscores a trend that has the attention of hotel marketers: Consumers using mobile devices are more likely to make a last-minute booking compared to desktop users. Millennials, again, are driving this trend. Because they are relatively young and have fewer commitments, they can afford to be more spontaneous than previous generations. A Hotwire study indicated that 84 percent of survey respondents, ages 23 to 38, had booked a trip within seven days of their arrival date, and 40 percent said they had booked a same-day excursion.

People who plan their trips with more lead time are more likely to use a desktop computer, while spontaneous travelers are more likely to book their trip with a mobile device. In fact, according to one study reported by ABC News, 60- to 70-percent of same-day hotel bookings are made on a smartphone or other handheld device. This explains hotels’ current focus on generating more bookings via mobile services and using design elements like large click buttons and icons to facilitate mobile conversion.

3. Eco-friendly offerings 


A booking.com sustainability travel report revealed that 55 percent of global travelers are more committed to taking an eco-friendly vacation than the previous year. It makes sense when you consider the data. A Mandala Research study indicated that 60 percent of U.S. travelers had taken an eco-friendly trip over the past year. 

In 2019, hotels and resorts in the U.S. and throughout the world are answering the call with energy-efficient building systems, green building ratings and certification systems, and by promoting themselves as eco-friendly hotels. Some hotels are instituting towel-reuse policies and are using sensors to monitor in-room electricity output; lights and air conditioning turn off if guests leave their room, and on again when they return. Other hotels are reducing their carbon footprint by going paperless and adopting cloud-based property management systems like StayNTouch.

Travelers this year are not just requesting but demanding that hotels reduce their carbon footprint. In fact, we’d venture to say that sustainable tourism is more than a trend – it’s on its way to becoming the new normal. Hotels that embrace sustainable values and enact sustainable practices are not only earning their guests’ long-term loyalty – they are also reducing their utility expenses and becoming leaner, meaner, and more profitable enterprises.

4. Personalized guest experience 

In 2019, we have learned that the personalization movement in the hospitality industry is no fluke, it is here to stay. The under-40 millennials, not to mention the even younger members of Generation Z, are seeking a personalized and personal experience at every point along their journey. To meet this demand, the hospitality industry is rethinking its role. In 2019, hotels and resorts are becoming facilitators and curators of personalized guest experiences inside the hotel and extending beyond the hotel environs.

Hotels are investing in technology that personalizes, simplifies, and automates every facet of the guest journey from beginning to end, smoothly and seamlessly.

In 2019, hotels are beginning to simplify the check-in process with some hotels streamlining or even phasing out the conventional check-in desk and replacing it with self-serve kiosks or remote check-in. Hotels and resorts are utilizing automation and artificial intelligence – for example, chatbots – to send personalized messages, offers, and recommendations to guests. Others are creating one-of-a-kind, in-room experiences, like directing the drapes to open automatically in the morning (that’s right, alarm clocks are becoming old-school), along with a freshly brewed pot of coffee. Personalization requires data collection. Guest profiles must be continually updated to include individual preferences and idiosyncrasies. Personalization is not merely a nice thing to do, it’s absolutely essential. In fact, there’s no better way to damage a brand or a hotel than to offer a one-size-fits-all approach to the guest experience.

5. Social media/influencers

In 2019, the social media universe has only become more important and influential for the hospitality industry. According to research, millennials are 50 percent more likely than previous generations to book a hotel based on what they see on social media or read in a blog-post. The key for hotels is not just to promote their offerings but to authentically engage on social media and to respond to questions and complaints in an expeditious manner.

Hotels are leveraging social media not just to increase bookings, but also for reputation management. In fact, hotels that are not part of the social media conversation are putting their reputations at risk. Before social media, a hotel guest who had a bad experience might tell close friends and family, but the damage could be contained. Now if that happens, one of the first things a millennial does is share it on their social media networks, where word of mouth spreads like wildfire. This is why, in 2019, more hoteliers are not only leveraging their social media presence, but they are also employing artificial intelligence to quickly scan and analyze in real-time what people are saying about their brand across various social media networks. Hotels that identify issues before they escalate can address them and put out any fires before they hurt their reputation.

We are also seeing a shift in social media strategy from macro-influencers to micro-influencers. The conventional wisdom used to be that, in order to reach the broadest market possible, brands sought out mass-market influencers with massive followings. In 2019, the theme is all about being small, intimate, and real; quality over quantity. This sensibility is driving hotels’ influencer campaigns as well. Instead of setting their sights on the Kardashians of the world, hotels are leveraging social media influencers – vloggers, bloggers, and Instagrammers – with 10,000 or fewer followers. When they post reviews and photographs of your property, micro-influencers can be very effective ambassadors because of their street credibility among a focused audience. Also, because the cost involved is virtually zero, save for a free hotel room or meal, hotels find they can develop relationships with numerous social media influencers. It’s a low-cost and powerful tool available to hotels of all sizes. 

In Conclusion

At the midyear point of 2019, we see clearly how rapidly and fundamentally technology is reshaping and redefining the hospitality industry. As you take inventory of everything your team has accomplished during the first half of the year, now is also a good time to identify what new initiatives you want to undertake for the remainder of the year. What niche market can your hotel cultivate? How is your mobile strategy going? Are you engaging on social media, reaching out to micro-influencers, and monitoring what’s being said about your brand? Is your property conforming to eco-friendly policies – and if so, how are you promoting it? And finally, are you facilitating personalized guest experiences throughout your hotel and in your local community?

As you can see, there’s a good amount of work to be done in the second half of the year. But not to worry: There’s elegant and affordable technology available that seamlessly automates these projects and processes, saving you time and money.

What Airbnb Can Teach The Hotel Industry

If only we could go back in time — you know, B.A., “before Airbnb” disrupted the hotel industry and gobbled up billions of dollars in revenue that were diverted from traditional hotels. 

It’s tempting for hotels to want to blame Airbnb and make them out to be the villain. Here’s an idea: instead of thinking of the company as a source of frustration, try making their success a source of inspiration.

Since going back in time, to a pre-Airbnb era, is not an option, hotels and resorts are better off accepting and embracing the new ways of doing business that Airbnb’s success has ushered in. Hotels are looking at the case study of Airbnb and its unique approach to the guest experience, and are realizing that they have to make some changes. Many are seeking unique ways to connect with the increasingly digitally savvy millennials as well as Generation Z.

How can hotels reclaim their customers and recover their share of the market? How, in other words, can they turn a crisis into an opportunity? Here are eight lessons learned from Airbnb’s ascendancy that hotels can start applying today:

Looks Matter

Hotels can enhance the guest experience by introducing unique room types with different layouts and configurations. A rooftop bar appeals to almost all of your customer segments, especially millennials, and is an example of a feature that hotels alone can offer. Another is the idea of designing a custom space where guests can congregate, check their social media accounts, and enjoy a beverage.

A team with each member handling different functions and facets of your hotel is needed to drive a change project of this scope. The designer will drive the hotel of the future and is a key player who needs to be at the table from day one and involved in the entire process, especially when it comes to experiential elements. Nowadays, how your hotel looks and makes your guests feel is just as important as its list of amenities. It’s also important from a design perspective to ensure that your hotel authentically represents the community in which it resides.

Content is Marketing

Airbnb understood early on that content isn’t just how you satisfy a reader but it’s also how you attract an audience and build a brand. Their primary customers were travelers and potential hosts. Airbnb’s content marketing strategy focused on authentic and relevant experiences and included online contents, blogs, and city guides. One particularly successful strategy was producing a glossy magazine for Airbnb hosts which included profiles on artists, chefs, and other stories celebrating the passions of their community.

Hotel operators should borrow a page from Airbnb. Consider the different audiences you want to reach, from the business traveler to the millennial hipster to families. Tell a story — not a self-serving narrative about how great your hotel is, but a story that casts the customer as the hero and your hotel as the helpful guide who facilitates everything the customer needs to complete her journey.

Be Digital Driven

People tend to get one thing wrong about Airbnb. They commonly describe it as a hospitality company, while the people who run the company insist it is actually a technology company. Consider its interface: it’s intuitive, inviting, and interesting, which is not always the case with all hotel websites.

If you want your piece of the millennial pie, not to mention Generation Z, then enhancing your digital presence and capabilities is a non-negotiable. The younger generations seek a digital experience that is easy and efficient. Strive to provide an online experience that simplifies the pre-booking process and makes it a piece of cake for guests to uncover the information nuggets they’re looking for, as well as photos and visual elements that create an emotional connection with your hotel.

If your website is the first and most important contact point for your guests, then it deserves special treatment. Airbnb’s clean and well-organized interface did not happen by accident. Before it was ready for primetime, the home-sharing company tested different designs and configurations with customers and fine-tuned it based on their feedback. Granted, you may not have the big budget that Airbnb has, but there’s a lot you can do that won’t break the bank. Borrow a page from Airbnb by using user-generated and co-created content provided by your guests. Encourage them to post photos on their social media networks or contribute a guest blog for your website. Turn your guests into your very own focus group and make them your brand ambassadors.

Airbnb understands that the guest journey begins with research and planning, which increasingly occurs on a tablet or Smartphone. Prior to booking, guests will devour blogs, conduct searches, check social media and consult user reviews.

Like Airbnb, hotels should invest in online marketing and paid search to attract prospects.  

Create Local Experiences

Part of Airbnb’s success can be attributed to its ability to make guests feel as though they are part of the community rather than apart from the community. They provide guests with an insider’s view of a community; for the duration of their stay, they can feel like a local rather than a tourist.

Hotels, on the other hand, have traditionally emphasized the services and amenities that they offer inside their hotel. Sure, they provided information on local attractions, but not much more than that. In the post-Airbnb world, hotels are positioning themselves as facilitators of local, authentic experiences and helping to connect guests with local products, local flavors, and local perspectives. Hotels are seeking to better understand their surrounding community and environment, so they can blend into the landscape — culturally and from a design perspective.

Be Unique

Competing in the post-Airbnb world is all about differentiation. One way to stand out is through cultivating a personality for your hotel. This is kind of a revolutionary concept when you think about it. Before Airbnb changed the rules, hotel branding had always been about creating consistency, so customers knew exactly what to expect regardless of the city they were in. The guests didn’t want any surprises. The big difference now is that they want a surprise. They want to experience something unique. The Airbnb website makes each rental seem like special, one-of-a-kind experience in contrast to some cookie cutter hotel brands. The takeaway is clear: being big and corporate is out, while being local, small, and real is in. This is especially true of millennials. With this in mind, hotel operators should try to create a unique personality for each of their properties. Although Airbnb is a large technology corporation, take a look at its website interface—its brand personality is intimate and personal, and engenders trust.

Leverage technology 

Hotels are seeing the writing on the wall and are beginning to incorporate more technology into the design of experiential offerings. Some are using software-based PMS systems like StayNTouch to simplify the booking and check-in process. Investments in technology are the one factor that could really level the playing field and enable hotels to compete more effectively in the Airbnb world. In addition, the introduction of technology across various branded properties will reduce operational and marketing costs for hotels.

Data Matters

One factor that has enabled Airbnb’s sustained success is its talent for capturing customer data that it uses to provide a more relevant and customized experience and message. Obtaining the right data to deliver personalized experiences is not difficult at all. Leveraging this information by converting it to offerings that guests seek is yet another way that hotels can try to win back some of their customers. To be truly data driven, you need access to customer feedback, which is another activity in which Airbnb shines. They are seasoned experts when it comes to motivating guests and hosts to leave reviews, which is essential to creating a sense of trust. Hotels, on the other hand, tend not to invest as much time encouraging guest reviews. As a result, the negative reviews stand out and get disproportionate attention.

Maximize Strengths

The good news is that, although Airbnb has taken a good chunk of your market share, all is not lost. For one, not everyone wants to spend their vacation or business trip at a stranger’s home. In addition, hotels have unique strengths that the short-term rental industry simply cannot touch. Hotels, for example, offer convenience, security, and, for people who prefer predictability, a familiar and recognizable place to spend the night. And while Airbnb may suit guests who value privacy and seclusion, hotels have real human beings who will interact with guests, not to mention a concierge, fitness centers and meeting rooms, a place to take a stroll, and often a restaurant and bar.

The short-term rental market popularized by Airbnb provides consumers with another option, but it has not and will not replace hotels. There’s plenty that hotels can do to level the playing field with Airbnb and regain their competitive position.

In this blog we examined two strategies to win back the market: First, emulate Airbnb in key areas such as its adoption of technology, the simplicity of its digital presence, and its use of storytelling and content marketing; and second, stand out and draw a contrast with the short-term rental industry by building on hotels’ existing strengths and highlighting their unique selling points.

Overbooking Your Hotel

Overbooking, a revenue management strategy practiced by the hotel industry, carries both risks and rewards. It can be a strategic way to maximize occupancy and per-room revenue, but if executed without proper care, it can backfire and cause financial loss and damage to your brand.

This blog will provide an overview of overbooking, including its benefits and potential costs. We will discuss what hotels should do if they suspect they are overbooked, and we will examine the practice of “walking” a hotel guest.

Why Overbook?

One constant in the hotel industry, the one thing you can always count on, is the no-show. On any given night there will be a certain percentage of guests who, for whatever reason, never arrive. When last-minute cancellations and no-shows occur, the rooms they had reserved sit empty and become revenue losers.

Consider research published in the Journal of Applied Sciences, which concluded that, on an average night, hotels experience a no-show rate of between five and 15 percent. To protect against a vacant rooms scenario, a hotel might overbook its rooms by up to 15 percent.

With a strong U.S. economy, occupancy rates are expected to climb higher in 2019 — to 66 percent on an average night — than they have in 40 years, said Bjorn Hanson, an adjunct professor at New York University’s Tisch Center of Hospitality. Compare this with 2009, when the hotel occupancy rate on an average night was 54.6 percent, according to the travel research company STR. If the hotel is located in a major business market, that could mean occupancy rates of 90 percent and higher throughout the year.

What this means for hotel operators is that, if you haven’t yet confronted the overbooking dilemma, chances are you will soon.

One of the most common explanations for overbookings is OTAs — online travel agencies like Expedia, Priceline, and now, Google Flights and Hotels. The industry considers them a mixed blessing; hotels of course like the increased revenue, but having to manually update room inventory across the various OTAs takes a good amount of time, and during busy times it sometimes falls through the cracks. When OTAs are not promptly updated, this means the rooms that are advertised may not be available and are prone to being overbooked.

The good news is that technology is available to solve this problem. Software-based, property management systems like StayNTouch can help simplify and automate the management of OTAs.

Walking

When hotels overbook their rooms, they run the risk of having to turn away guestswith confirmed reservations. When that happens, it’s called “walking.” A hotel employee must bear the brunt of the customer’s anger and then “walk” the displaced guest to another property at the hotel’s expense.

Overbooking can be stressful for all parties involved, including the front desk, your revenue and marketing team, and most importantly, your guest who arrived with certain expectations.

This pattern of booking one hotel guest as an insurance policy — in the expectation that another guest might not show up — can cause a good deal of anxiety for staff, where they essentially become players in a game of “overbooking roulette.” The truth is, it happens a lot more than you might think, though for good reason hotel operators keep mum about it.

What to do about it

When you first suspect you are overbooked, follow these steps to ensure that any risk to your hotel’s brand and bottom line is averted.

1. Confirm

The initial step is to double check that a guest relocation is required. You want to ensure that your property is in fact fully occupied.

Consult your guest-arrival list to make sure there wasn’t a booking mistake, duplicated reservation, or cancellation. Assuming you’ve checked for errors and found none, your next step is coming up with a strategy.

Consider how many incoming reservations you have for the day and how many no-shows or cancellations you expect. For example, if you typically experience one last-minute cancellation per day, and you only have one overbooking, it may not be a crisis situation.

Assuming you’ve checked for errors and found none, your next step is coming up with a strategy.

2. Analyze

How will you determine which guests can be “walked” and which must not be inconvenienced?Begin by analyzing your bookings to determine who is a suitable candidate for relocation.

Consider how many incoming reservations you have for the day and how many no-shows or cancellations you expect. For example, If you typically experience one last-minute cancellation per day, and you only have one overbooking, it may not be a crisis situation.

Other factors to take into account include the source of the booking, when it was made, the duration of the reservation, and any fee agreements or penalties from third parties. Most hotels have a checklist of criteria they use to analyze their bookings. In general, guests booked for short-term stays, such as business travelers, are typically chosen for relocation.

3. Rebook

If relocating — or “walking” the guest — is determined to be necessary, the next step is to rebook the customer at a comparable property.

This is not a time for pinching pennies. How your employees conduct themselves at this stage, and the decisions that they make, will be critical.

Ideally, you have a pre-existing relationship with other local hotels that offer comparable quality, guest experience, and location; begin contacting them to determine if they have vacancies. You will want to inquire if they have a similar room available and if they will entertain the same rate that you had quoted the guest.

If you can, be proactive and contact the guests before they arrive and apprise them of the situation. If you can arrange for their relocation to another hotel before they arrive at the front desk, things will go much more smoothly.

The job of the hotel staff is not just to book another hotel, but to be a source of information and a comfort to the guest. Err on the side of over-communicating: Make sure they know exactly where they are being relocated and reassure them that it is a safe and attractive hotel.

4. Do Damage control

Those guests who have been walked to other properties have the potential to do serious damage to your brand.

In our hyper-connected world, displaced  guests who were treated poorly can post negative online reviews, share their frustrations with their peers, and refuse to stay at your hotel in the future — all of which hurts your brand reputation and bottom line.

To avoid this scenario, hotels must bend over backwards to please and placate guests they overbooked. As bad as it may sound, this is actually a chance to shine; with the right attitude, you can turn a potential crisis into an opportunity by demonstrating concern for your guest’s well-being and providing top-tier customer service. When all is said and done, what your guests will remember is how your team handled the situation. 

At the very minimum, you should cover the cost of a one-night stay at a similar hotel, internet access, and the cost of an Uber. Be clear in communicating exactly what your compensation will entail. Hotel staff are often empowered to offer additional perks such as a complimentary meal, upgrades for future visits, gift cards, or free tickets to a show.

Loyalty club members should receive special consideration. If possible, exclude them from your list of potential relocations. If they have to be walked, see if you can give them additional benefits through your loyalty program.

The case of Marriott International is a good example of using a loyalty program to help compensate guests and ease their pain after the hotel was forced to walk them. Through its Marriott Bonvoy loyalty program, the hotel offers most members who were walked a cash gift card plus loyalty points. Other properties have offered some loyalty program members $200 in cash in addition to 90,000 points.

5. Leverage technology

Booking cancellations adversely affect hotels’ ability to accurately forecast their occupancy and revenue levels. This is one reason we are seeing hotels adopt overbooking practices and more stringent cancellation policies.

Hotels have begun penalizing guests for their flakiness. According to Lodging Magazine, revenue that hotels received for cancellations and no-shows increased by almost 12 percent annually on average from 2012 to 2016.

Hotels and resorts that lack real-time, actionable data will struggle to make strategic decisions and achieve their occupancy and revenue goals.But with the right technology and data sets, hotels can actually predict with great accuracy which guests are most likely to cancel. Having this data at their fingertips reduces overbooking and enables them to better anticipate cancellations and no-shows.

Hotels that invest in technology will be ahead of the curve in terms of guarding their reputation and maximizing profit.

Tracking your bookings and cancellations manually is time-intensive and prone to error. Software-based, hotel property management systems like StayNTouch enable hotel operators to review bookings and occupancy levels in real time and make sound, data-driven decisions that drive their bottom line.

This doesn’t mean that you won’t ever overbook or walk a guest again — you will. That’s just the nature of the business. But when you do, it will be on your terms.

Does your hotel or resort have a strategy in place for dealing with overbooking? Learn how to overbook the strategic way by signing up for our free webinar.

How Millennials Are Influencing Change In The Hospitality Industry

With a reputation for knowing exactly what they like and don’t like, millennials are redefining and reshaping the hospitality industry. Is your hotel or resort equipped to meet the demands of this very demanding (and lucrative) customer segment? In this blog we will begin by reviewing the data and market research for insight into these passionate and picky travelers who are changing the face of your industry.

The millennial generation is composed of 20- and 30-somethings, or those born between 1981 and 1997 according to the Pew Research Center. They account for 27 percent of the global population or about 2 billion people. The approximately 83 million millennials who reside in the U.S. are not a monolith; in fact they are perhaps the most diverse generation in American history. By 2020, they will account for 50 percent of the workforce globally and, according to the analysts at Bernstein, millennials are poised to have more spending power than baby boomers – in many ways, they are the most powerful and influential consumer group that we have ever experienced.

Constant Demand for Technology

Millennials represent the first generation of digital natives. They grew up in a time of rapid technological change, are connected 24/7, and are capable of managing an array of applications with ease. When it comes to traveling and hotel stays, millennials are keen to use technology to make their lives easier and their travel experience more seamless. They are driving the demand for technology-driven, experiential travel and sustainable practices.

What does going digital mean for your hotel or resort?

It means leveraging technology at every stage and every touch point throughout your customer’s journey. If your hotel’s digital presence isn’t up to par, you simply aren’t going to attract your share of the  millennial market. If your website is not mobile-driven or if you’re not engaging on the right social media platforms, the millennials won’t give you the time of day.

Consider these data points:

  • 46 percent book travel through a smartphone or tablet

Because they were raised in an era of instant gratification, millennials may be the most impatient generation ever. Waiting in long lines for hotel registration is so yesterday. In a survey of 500 millennials, 90 percent indicated they would rather use their mobile device for check-in.

Placing check-in kiosks in the lobby is another attractive option, as are charging stations. Free Wi-Fi is no longer an option — for the millennial market, it’s a non-negotiable.

Social Media

According to research, millennials are 50 percent more likely than previous generations to say social media and blogs are important factors in their decision to book a reservation.

Millennials expect brands to not only be visible on social networks, but to engage them with relevant content and helpful guidance. According to studies, 62 percent of millennials say that if a brand engages with them on social networks, they are more likely to become a loyal customer. Engage them and you will be rewarded.

Reputation Management

Hospitality is a reputation-driven sector, and what people think and say about your brand can make or break you. According to research, 89 percent of millennials trust recommendations from friends and family more than self-serving claims by a company, and they are 247 percent more likely to be influenced by blogs or social networking sites.

People are talking! Artificial intelligence can be used to quickly analyze social-media posts and provide insight into the narrative or conversation that is being spread about your brand. If issues arise, you can dress them in real time, before the damage to your reputation is done.

The takeaway: To remain competitive, hotels and resorts must ramp up their social media and digital marketing efforts. It’s not merely a nice thing to do; your property’s future economic viability depends on it.

Going Green

Credit Suisse’s Global Investor report turned a lot of heads when it was released in 2017. It concluded that the millennial generation’s insistence on being eco-friendly was influencing many sectors: “Companies must deliver good social and environmental performance and engage in sustainable practices or their future growth could be at risk.”

Hoteliers across the country and throughout the world are heeding the call. Many are installing energy-efficient building systems, adopting efficient waste management techniques, instituting green building rating and certification systems, and marketing themselves as eco-friendly destinations.

It makes sense when you consider the data. A study by Mandala Research concluded that 60 percent of U.S. travelers had taken an eco-friendly trip over the past three years.

A Booking.com sustainability travel report indicated that 55 percent of international travelers are more determined to book sustainable, eco-friendly vacations than the previous year.

Attitudes are changing and that’s a reflection of the tremendous power millennials possess.

Meaningful Experiences

Millennials are willing to pay for truly valuable and one-of-a-kind experiences. They desire the new and novel, and crave the unexpected. They want meaningful travel experiences and demand the distinct and different. A study commissioned by Eventbrite found that 78 percent of millennials prefer to spend more money on experiences than on material things. According to the Eventbrite study, the benefits of opting for experiences is deeply personal. Eight in ten millennials said experiences help shape their identity and create lifelong experiences. Almost 70 percent said their experiences make them feel more connected to their communities, to other people, and to the world. Demand for new, unique and “experiential travel” is driving hoteliers to provide a more personalized, immersive, and adventurous environment for the millennial market.

A prime example is the trendy boutique hotel group, citizenM, which has properties in Amsterdam, Glasgow, London, New York, Paris and Rotterdam. The brand denounces now-defunct amenities such as trouser presses, bellboys and, in their words, “stupid pillow chocolates.” Even as a chain, citizenM works to give millennial travelers what they’re really looking for – a unique local experience. Similarly, Zoku is another one of a growing number of distinctive properties worldwide that have moved away from the traditional hotel concept and instead empowers guests to design their stay just the way they want it.

The truth is, hoteliers have only one option — adapt to this new world or risk becoming obsolete. If your property has not yet begun the social and technological transformation that is required of today’s hotels and resorts, not to worry. There’s still time to get started on your journey, but don’t wait too long. By 2025, literally half of all travelers will be millennials.

How to Meet the Demand of a Generation That Travels More

Hotels and resorts know they need to win over millennials’ hearts and minds. But where to begin? That is the question. In this blog, we will help you better understand the unique needs, expectations, and attitudes that millennials hold. We will provide actionable insights and strategies that will enable you to effectively target, attract, and convert millennials into loyal and profitable guests.

According to the U.S. Census Bureau, there are over 83.1 million millennials living in the U.S. today. With $200 billion in annual buying power, hotel operators can’t afford to ignore this large and diverse generation. However, millennials are a unique breed, a different specimen then we’ve seen before. They seek a different type of travel experience than their parents and grandparents enjoyed. So, who are the millennials and what makes them tick?

When we talk about millennial travelers, those born between 1981 and 1997, we’re talking about people who today are in their 20s or 30s.

They take on average 35 days of vacation every year. And unlike other generations that are curtailing their travel expenditures, millennials are increasing the amount they spend on travel. (So is the even younger Generation Z, which is on the rise.)

In fact, in a recent survey of millennials, 33 percent said they would be willing to spend over $5,000 on travel.

The millennial generation is very discriminating and particular in terms of what businesses and brands they support. They know what they like, and what they don’t like.

Here are a few examples:

Technology

Millennials are, first and foremost, members of the Smartphone generation.

They were raised on the internet and social media. Their perception of your hotel or resort will initially be defined by their digital experience. Millennials value convenience, speed, and efficiency. They are the instant gratification generation.

Consider these data points:

  • 73 percent saying they check the company’s social media feed before booking
  • 75 percent of millennials have booked travel via a mobile phone
  • 87 percent of millennials use between two and three tech devices on a daily basis
  • 46 percent use their smartphone or tablet to make travel reservations
  • 97 percent post their experiences on social media

Authentic Experiences

Millennial travelers crave unique and authentic experiences that they can share, in real time, with their friends and followers via their favorite social media sites.

Whether they are visiting the local sights or enjoying a local craft beer by the hotel pool, millennial travelers are all about the experience. Those hotels that consistently provide a personalized and value-added experience will earn the trust and loyalty of this important customer segment.

Price

Given that millennials tend to hold off getting married and starting a family, they possess more discretionary income compared with other customer segments. And even better, millennials like to use that extra income on travel.

But because they began their professional careers in the aftermath of a financial crisis, millennials also tend to be budget-conscious travelers; while authenticity is important, price is also a factor.

In a survey by Expedia Group, more than 90 percent of millennials indicated that, when it comes to hotel bookings, they won’t make a purchase until they have done extensive research and secured the very best price.

Millennials are not opposed to spending a good amount of money while traveling. It’s just that they would prefer to spend their discretionary income on experiences that they value instead of accumulating ordinary souvenirs from their travels.

Causes

Millennials take pride in being environmentally conscious travelers. Sustainability is one of their core values.

Millennials tend to seek out hotels that incorporate green practices and policies.

According to the Booking.com travel report, a solid majority of international travelers (55 percent) reported that they seek out travel options that promote sustainability and 73 percent indicated their intention to patronize an eco-friendly hotel in 2019.

Targeting Millennials

Research by Elite Daily and Millennial Branding indicates that marketing to millennials through conventional advertising may be a waste of time and budget. In their study, only 1 percent of millennials reported being persuaded by a corporate advertisement and less than 3 percent said TV news, magazines and books were a factor in their purchase decisions. Meanwhile, 84 percent said they simply don’t trust traditional advertising at all.

On the other hand, 62 percent of millennials say they are more likely to give their business to a brand that is visible on social media. Hotels, then, can convert millennials into loyal customers by engaging them on social media with personalized information and offers.

If you’re not currently participating on social media, it’s time to make the commitment. Consider this: The younger Generation Z, as you might expect, is even more accustomed to the social media universe than are millennials.

Living in the Now

Because they are younger and less tied down, millennials have a luxury that the rest of us don’t have — spontaneity. According to one survey, 49 percent of millennials said they partake in last-minute vacations. A study by Google and Phocuswright concluded that 60 percent of U.S. travelers were open to a spur-of-the-moment trip if they found the right deal.

The takeaway: Hotels that tempt millennials with enticing last-minute deals will be rewarded.

Is your property positioned to meet the needs of the millennials? If it’s not, consider these strategies:

Strategies & Solutions

1.Cater to the mobile traveler

If you haven’t already, commit to going digital and investing in a mobile-centric environment.

2. Create enhanced guest experiences

For example, create authentic gathering places for guests to congregate, connect with each other, decompress, and plan their next move.

Cookie cutter experiences turn off millennials. They want local, authentic, and personalized  experiences. This could translate to using locally grown ingredients in your restaurant, featuring locally brewed craft beer at your bar, or adorning your hotel environs with art created by local artists.

3. Engage on social media

This is how brands build trust with millennials. It’s not enough to have a presence on social media — you need to engage with travelers by being responsive, helpful, and fun.

Millennials don’t want to receive a sales pitch on social media. Use it to build relationships and to personalize and humanize your brand.

4. Leverage technology

The millennials are coming, the millennials are coming!

If you are concerned about your ability to meet the increased demand from the (sometimes) demanding millennials, just remember that technology is your friend.

Did you know that among U.S. travelers surveyed, 44 percent told hotel.com that they would be willing to check themselves in at a hotel kiosk?

Then why not deploy self-service software to save money and simplify time-consuming processes like check-in? What’s more, consider adding check-in kiosks in the lobby and eliminating the front desk altogether. Streamlining the check-in process will endear you to millennials, who think manual check-in is unnecessary and cumbersome in the digital age, and a waste of their precious time.

Also, invest in the latest technologies. Keyless entry, mobile payments, smart TVs (with Netflix of course!), and smartphone charging ports will put you in good stead with the millennials. Without these bells and whistles, they feel lost.

5. Data is your friend

Hotels and resorts can’t offer guests personalized service if they don’t know each customer’s particular wants and needs. Here enters the importance of data.

With an insight-driven PMS system like StayNTouch, hoteliers have at their fingertips everything they need to add value and fulfill each customer’s expectations, including a guest profile, booking history and social media accounts. If given the right technology, any member of your staff will be empowered to proactively craft a data-driven, unique experience for every guest.

6. Offer cool perks

Add value and convenience by surprising your guests with Uber credits at check-in. That way, they can get a start seeing the sights without delay. Millennials are notoriously impatient and this small gesture will create more goodwill for your property than you know.

Powerful WiFi, these days, is a non-negotiable. And free breakfast — Hello Instagram — doesn’t hurt.

Consider the market size of the millennial generation, its enormous purchasing power, and its penchant for planned and spontaneous travel. Hotels and resorts that aren’t properly positioned to serve this customer segment are depriving themselves of a big revenue stream.

The most effective way to target millennials is to build an authentic brand in the social space. Show them that you share their values. Earn their trust.

By providing an authentic experience that is digital, convenient, seamless, and always customized, your hotel or resort can earn the loyalty of this important customer segment.

How to Embrace Technology That is Shaping Millennial Travel

In our always connected world, Millennials are much savvier when it comes to using tech for travel. Gen-Y grew up immersed in technology and their smartphones have become an extension of who they are – it’s part of their DNA. In fact, on survey found that 80% of Millennials sleep right next to their smartphone. They have used and relied on personal devices their entire lives and as a result have certain expectations regarding mobility and connectivity.

Not surprisingly, when it comes to travel, in lieu of luxurious four-poster beds or decorative pillows and throws, millennials expect more and better technology in order for their hotel stay to be a good one. Traditional marketing techniques and advertising channels that once enticed their parents to book a hotel room no longer work on this generation of consumers. Instead they look to technology and their peers during the planning, travel, and post-stay phases of the their journey.

So, how can hoteliers embrace technology to appeal to this demographic, secure those reservations and meet the stay expectations of the Millennial traveller?

Be Web and Mobile Focused:

More and more millennials use their mobile to make their purchasing decisions turning online to book flights and accommodation. According to a survey – New Horizons IV – by WYSE Travel Confederation, online accounts for a whopping 80% of under-30s travel bookings, while Google cites that two thirds of millennial travelers are comfortable booking an entire trip on a smartphone. So, as mobile booking becomes more ubiquitous, we can expect that number to continue rising.

What all that means is, adopting a mobile-first mindset when it comes to advertising, website efforts and online booking capabilities should be considered an absolute necessity. Millennials are driven by convenience and expect information to be easily accessible, simple to find and function correctly on any device they use – 52% of consumers will abandon an online purchase if they can’t find a quick answer.

By bolstering your online web presence that is mobile-responsive, provides new marketing and revenue opportunities while also playing a critical role in the customer experience and potentially, customer loyalty.

Be Socially Conscious:

Not only are millennials using mobile devices to plan and book travel, they are also using them to share experiences while traveling. Social media is a prime way in which millennials make themselves heard and are always ready to capture special moments for social media. 78% of them engage with brands on social media while just 47% of older generations do. Not only that, but millennial’s respect and rely on the opinions of their peers, so any shared experiences they are compelled to post on their personal accounts are far more authentic and credible than any magazine ad, sponsored blog post or stock photo. In fact, when planning and researching a trip 89% of this group plan travel activities based on content posted by their peers.

With their consistent use of social media and need for validation and documentation, it’s clear that hotels must provide an unparalleled social experience, significantly supported by meaningful engagement from the hotel. With a well-thought-out social media plan with the millennial traveller in mind hoteliers can successfully attract new custom leading to increased conversions.

Be Self-Service Ready:

While the concept of self-service may, at a glance, seem to contradict the everyday luxuries associated with the hospitality experience (having staff dote on each guest), the guest-driven demand is not at all unfounded. More than 85% of consumers have used a self-service options when they shop, with 73% of consumers saying they prefer self-service technologies, such as self-checkout, over engaging with brand associates.

When it comes to millennials and their stay experience, they have a vested preference for convenient, frictionless experiences. They want more control over their interactions – they want to use their smartphones throughout their stay experience, from self-checking, ordering room service, controlling their room HVAC and lighting, access digital concierge services, make dinner reservations, book a spa treatment, settle payments etc.

By providing self-service technology options hoteliers have an integral opportunity to cater to individual guest needs with ease.

It goes without saying, millennials are forever connected. They have grown up completely surrounded by and adapting to high-tech gadgets. They are also endless explorers thirsty for knowledge, seeking meaningful authentic experiences. By offering an experience that is digital, seamless and convenient, your hotel will stand to establish millennial loyalty that translates into an exciting revenue opportunities, both now and in the future.

The Rise of the Robot Butler: Fad or Future of Guest Service?

With the advent of motion pictures, science fiction writers’ have often provided prescient glimpses of future technologies. These inventions and happenings that were once dreamt up in the pages of fantasy novels and the far-flung corners of the imagination seemed like futuristic impossibilities. However, many have moved into the realm of reality; Google Glass and robots all had roots in films such as Blade Runner (1982) and Back to the Future (1989). Self-driving cars took to the roads in Total Recall (1990). Now, they’re being tested in Nevada as driverless Google cars. Videophone communications, 3-D printers (replicators), computer speech recognition and the most iconic handheld communicator (mobile) all made their debut in the Star Trek franchise. And now experts predict that within 10 years general-purpose robots, will perform household chores while consumers are at work; or serve as butlers at cocktail parties.

Are Robots the way of the future?

Well, “robots” have already been deployed in many industries for a long time. They have been imagined as a facet of the future ever since Fritz Lang’s Metropolis and while they seem like a relatively new addition to our lives, one of the world’s first working robots named Unimate joined the assembly line at the General Motors plant in Ewing Township as far back as 1961, revolutionizing the industrial workplace. Since then robots have routinely been used in the mechanical industry for cutting, grinding, for assemble products, for picking, packing and palletizing to name but a few applications. And in recent years, robotics has found its way into the everyday consumer life, changing them in fundamental ways. While not necessarily in the shape of a humanoid, from drones to smartphones, from Apple’s Siri to Amazon’s Alexa, these forms of robots are already doing a lot of the things we can do, except now they’re often doing them better.

Robots in the hospitality industry?

At first sight, it might seem like a gimmick. 50 years ago, people would have scoffed at the idea, but now at the rapid pace in which technology is changing, this has become very much a reality. Hotels across the US from the Westin in Buffalo, New York, to the Sheraton Los Angeles San Gabriel Hotel, are experimenting with using robots and AI as part of the guest experience in their hotel. Back in 2014 Starwood hired a robot butler – Botlr – to work back and front of house across its hotels in the US. “The guests really love the robot here…We place it near the front door and people ask it questions when they arrive. It is really handy if we are busy at the desk and a guest wants something like a towel.” Ankit Dhakal, the hotel’s Front Desk Manager. InterContinental Hotel Group (IHG) trialed delivery robot Dash as its Crowne Plaza hotel in Silicon Valley. The three-foot-tall machine which delivers snacks, toothbrushes, and other amenities to guest rooms – travels at walking pace and can navigate floors by using the Wi-Fi to call lifts. Hilton Mclean in Virginia partnered with IBM and is using ‘Connie’, a robot butler as their concierge. Connie provides basic information such as the spa and gym timings, location of the nearest bank, things to do as well as personalized information for a guest’s needs.

There is no doubt that the use of robots within the hospitality industry is becoming a more commonplace trend and it’s not hard to see why. Robots are seen as being more efficient, better at dealing with different languages and handling data than their human counterparts. In certain situations, robots can perform with a greater degree of accuracy and consistency than humans would be able to, and ‘human error’ is eliminated.

While they regularly come under hefty criticism that they will supplant human employees and in particular replace the human element in service industries. However, this has been counterbalanced by praise for the significant labor efficiencies, improved social rankings and revolutionized customer service experience noticed in robot-staffed properties. They can be worked harder than humans and increase a hotel’s brand visibility in a fun and unique way. Not only that but robots and AI are emerging as valuable solutions for those operating in the hospitality industry by taking over the monotonous, time-consuming tasks and performing simple jobs such as greeting arriving guests, storing luggage, delivering food and laundry to rooms etc. and in doing so are freeing up hotel staff to carry out more complex tasks, offering more on-site guest interaction, more time to focus on the guests and creating a more, ever-expected, personalized guest experience.  

So, robot butlers, are they a fad or future of guest service? The answer is they are already changing customer service. Robots are, and will continue to be, a popular technology trend within the hospitality industry because ideas of automation and self-service are playing an increasingly vital role in the customer experience. The use of robots can lead to improvements in terms of speed, cost-effectiveness and even accuracy. Hospitality is a natural fit for this type of technology so it seems inevitable to play a major role in future businesses.