It’s a new year. That makes it a time chock full of potential opportunity and possibility for your hotel business. However, to find maximum success in 2018, it’s critical to be aware of the mega trends shaping the current and future state of the hospitality industry. Here are three issues you should be aware of to better prepare for profitability in 2018.
Balancing High Tech and High Touch – Hotels and the tech sector are seemingly merging. And it is creating new challenges and opportunities that will play out throughout the calendar year. We are seeing hotels getting robot butlers, new apps helping guests serve themselves by offering digital check in and room keys (and much more!), and now Best Western is testing Amazon Echo to simplify the guest experience through automation.
While each of these are smart responses to morphing societal trends, hoteliers must continue focusing on doing what they do best, delivering human hospitality. Customers still crave connecting with hotel staff, they’re just seeking different types of interactions. Rather than use staff for operational tasks, think about repurposing your people to deliver experience. That could be in the form of delivering great insight on local activities or restaurants, or connecting over conversation during breakfast hours.
People want to be social, just now they want to do it on their own terms. Or delighting and surprising guests with personalized preferences. The SkyTouch Technology Experience Program (STEP), for example, streamlines a hotelier’s ability to collect, and act upon, a guest’s preferences, which increases customer satisfaction.
‘New’ Rules – Years of new hotels opening – with more in all stages of the new construction pipeline – is adding pressure on operators of older hotels. According to Lodging Econometrics, 1,146 Projects with 130,633 Rooms will open in 2018, and another 1,153 Projects with 134,990 Rooms will open in 2019 within the United States alone. Seemingly every market is seeing more hotels open, and because they are new, consumers tend to gravitate toward them.
You can combat demand erosion by carefully considering how to renovate your property in key areas to keep it in “like-new” condition, and thereby keeping up customer service scores. Small touches can go a long way by incorporating more design splashes that create a sense of place, while ensuring you retain high placement on OTA and review sites.
Managing Costs – Controlling costs is always a concern for hoteliers. And with unemployment at 4.1 percent and continuing to drop, it’s putting wage pressure on hoteliers. Additionally, minimum wage increased on January 1, 2018 in 18 states, and 20 cities. Focus on ways to retain your staff in ways that satisfy their expectations with defining clear pathways to career growth and new responsibilities, for example.
With hotel industry turnover rates at 6.0 percent in November alone, anticipate costly staff replacements, estimated at about $1,200 per employee, according to a study by ADP. However, cloud-based property management systems such as the SkyTouch Hotel OS®, may potentially increase employee satisfaction with its ease of use, allowing them to get up to speed quickly and find success every day.
By focusing on these trends, you’ll be better prepared for the massive changes taking place in lodging business.