After The End

Technologists shift their focus from the Y2K doomsday to a new way of serving customers.

By Joan Marsan, Technology Editor -- HOTELS Magazine, 1/1/2000

Preparation and remediation were the mantras

of the decade’s

end. But now that the final hours of 1999 have unveiled

the successes and failures of systems, IT experts have refocused.

No longer need they wonder about the possible destruction of decades

of data. Rather, they can concentrate on the creation of sophisticated

systems for the new millennium. Before they throttled full-speed

ahead into a new era, several of these technology experts paused

and shared with us their insights, envisioning the future, one

in which technology will play a defining role.

Building Relationships

Technology and sales and marketing professionals

have joined forces in recent years, heavily investing effort and

capital in data warehousing projects. The intelligent use of that

data will determine hoteliers’ success

in years to come. “Today, the emphasis is on getting all of

the data into one place,” says Cindy Estis Green, senior vice

president, Pegasus Business Intelligence. “Tomorrow, the emphasis

will be on using the data intelligently to predict consumer

behavior, such as loyalty and usage patterns, and to use the customer

knowledge to anticipate customer needs or problems. Consumers in

2010 will expect information to be applied so their experiences are

hassle-free from making the reservation through checkout.”

This wealth of usable data and corresponding

heightened guest expectations will require staff to approach guests

in a more sensitive, informed fashion. “There will be a transition from management of customer

data to management of customer relationships,” Estis Green

says. “Hotel companies must carefully consider how they store,

track, analyze and act upon every aspect of their relationships

with guests and third-party bookers.”

Yield Management

Hoteliers will be able to capitalize on this

increased understanding of customer preferences. They will continue

to grow and develop their use of yield management principles, says

Alyson Dombey, partner, Partners in Marketing. “The concept of yield management will

be more closely integrated into the marketing arena,” Dombey

says, “with high-yield sales being driven by better understanding

of customer value.”

Dynamic systems will figure value by comparing

customer preferences and travel patterns with the product on hand. “Value modules

will supersede the concept of a hotel ‘rate,’” Dombey

says, “creating a unique ‘price per stay.’ They

will consider both the occupancy status of a hotel and the value

of a customer, trading off special offers during low occupancy, determining

new value acceptance levels during high occupancy periods, and denying

offers that don’t suit occupancy status. Modules will be tailored

to every channel through which a hotel chooses to distribute.”

Channel Ownership

Hotels rely on a vast array of reservations

channels to book business for their hotels in ever more sophisticated

ways. “The GDSs

will come out with channel pricing strategies, driven by their need

to be competitive within the Internet arena,” says Flo Lugli,

president, WizCom International. “Additional consolidation

will occur within the dot.com travel distribution companies,

and portals will be increasingly less important as consumers become

more familiar with their favorite sites. Travel agents will continue

to re-invent themselves, shifting away from the corporate market

and toward revenue opportunities in the leisure market.”

Just as many hotels, to varying degrees, outsource

aspects of their reservations operations to these increasingly

powerful entities, they outsource a wide range of technological

services and resources. “Outsourcing

will be a key technological trend going into the new millennium,

but perhaps not as we define the term today,” says Rob Grimes,

chairman and CEO, CynterCorp. “If we consider any product or

service that is provided by others to be generic outsourcing,

then clearly we can consider off-site hosting of applications to

be an outsourced product or service.”

Grimes believes all technology services, from

telecom, to training, to applications, will converge into a single

channel. “Emphasis

on ‘owning’ the channel will lead many new companies

into the hospitality technology business to create new ideas to leverage,

promote and buy technology by hospitality end-users,” Grimes

says. “The hospitality industry in total, including the foodservice

side of things, is going to continue to be one of the

best ways to touch all global citizens, so channel ownership by hospitality

companies and those that provide the technologies to them will be

a critical driving force and challenge.”

Timing Is Everything

Scott Anderson, executive vice president, sales

and marketing, Cendant Corporation, envisions a future dominated

by “The Eighth Continent,” a

virtual, technology-driven world. In this new world, every need requires

a speedy, direct response. “Service is a full-time proposition,” Anderson

says. “Customers want what they want when they want it—24

hours a day. Everything is done in real time. The ‘just in

time’ concept is not good enough anymore. The customer is too

close to care about anything but real time. Don’t waste time

with lots of claims or promises. Eighth Continent residents

want a solution that takes care of a problem or meets a need.”

Intuitive Technology

Fraser Hickox, group general manager, research and technology, The

Hong Kong and Shanghai Hotels, sees the evolution of in-room computer

use just around the corner, with the greater need for bandwidth ultimately

subsiding as operating systems gain efficiency. Digital television

will provide guests with data-casting services. And some day, guests

will be able to don helmets that immerse them, via telephony, in

their home or office environment. But these innovations will come

only when guests are ready to accept them.

“The real challenge through all of this is to keep the facility

simple and intuitive in its operation,” Hickox says. “While

we wish to offer our guests every function imaginable,

we do not wish to subject them to a telephone directory-sized instruction

manual as bedtime reading.”

Guest acceptance of new technology will continue

to determine the pace at which hotels are able to employ new systems. “ If we

travel too far or too fast,” Hickox says, “we will only

alienate our guests. As our properties continue to serve

as an extension of their residence, the environment should be calming

and relaxed while serving the ever-increasing demands of society

and industry.”

The People Problem

“Looking forward, the good news for the hotel industry is

that technology will increase our efficiency as operators,” says

John Burns, president, Hospitality Technology Consulting. “The

bad news, however, is that those systems will not run the hotel themselves.” Hiring

and retaining staff has been hoteliers’ primary problem in

recent years. The growing complexity and omnipresence of computerized

systems will only exacerbate the problem, Burns says, increasing

the need for highly skilled employees, without which, “achieving

the promise of those systems will become steadily more

difficult.”

The only viable solution, Burns asserts, is

an industry-wide shift in attitude toward personnel. “We

need to stop thinking of our housekeepers, our desk clerks, our

general managers and even our corporate staff as expendable. We

need to replace too-common lip-service to the value of our employees

with a genuine conviction that employees are the personality, character

and style of our hotel. They are its lifeblood and as such are

our most valuable asset.”

Reporting Live From The Lunar Hotel

Forty-five years, almost 9 million frequent flyer miles. It seems

like an eternity. My next trip will be to help open the Intergalactic

Sea of Tranquility Lunar Hotel. How ironic that I began traveling

just one year after the first moon landing in 1969 and my last business

trip will be to that very same landing site.

As the millennium began, the rage was databases, data warehouses

and data mining. Hotels made every effort to reach the segment of

one and tailor a yielded offer that could not be refused. The advent

of PDAs (personal digital assistants) changed that. The PDA stores

information about past trips. It learns the type of room the owner

enjoys and what they are willing to pay. The PDA continually searches

every booking system, making offers until it reaches agreement. It

knows the travel preferences of its owner, but has no loyalty to

brand. Its role is to find the right combination of product and services

to meet the experiential, situational and location needs for each

trip.

From the moment you arrive at the lunar hotel, the technology will

impress you. Our TEAMs (total environment actuation modules) have

been informed of all your preferences by your PDA. TEAMs will insure

that the flat screen walls in your room will meet your decorating

desires. Your favorite art and entertainment will be just be a thought

away. A module will take care of your lighting desires, temperature

needs and favorite aroma. TEAMs always know where you are and direct

inbound calls to the unit nearest you. Of course, the holographic

receiver is available if two-dimensional video is not quite enough.

There are many more surprises in store at this

revolutionary property. Suffice it to say, you have never before

experienced anything so unique, regardless of where you may have

traveled in the past. This property is the first that will deliver

on the goal of moving from the “segment of one” to the “product of one.” —John

Cahill, CIO, Manhattan East Suite Hotels, January 1,

2015