Jochen de Peuter Consultant at EHL Advisory Services
The constant evolution in digitalisation and technology has been changing the hospitality landscape at an ever-increasing pace, as never before. In addition, contemporary consumer trends of new generation’s digital native consumers such as mobile connectivity, social media, internet of things, personalisation or immediacy foster the technological disruption increasingly.
Within the hotel landscape there is a double and fierce competition among traditional hotel groups and against digital intermediaries who continue to disrupt the value chain between hotels and their customers. Consequently, a traditional hotel has to redefine itself to remain competitive in order to funnel effectively the customer journey from brand awareness to a loyal customer, even advocacy. One key challenge hereby is to change the corporate mind-set within a non-digital native organization.
At EHL Advisory Services, the premise is to start from the perspective of the customer. Therefor we believe that any hotelier should rethink their digital strategy and offer many more connections or interactions with guests. Ultimately, he must implement this digital transformation across the company.
Many disruptive digital innovations have been introduced over the last 10 years: open API’s, hotel cloud software (SaaS), third party integrations, data warehouse, artificial intelligence, mobile connectivity, etc. All of these innovations are a catalyser that foster clusters of hotel technology solutions for revenue management, upselling, customer engagement, rate distribution, online reputation, online visibility, etc. Therefor hotels are given more opportunities as ever before to redefine an own digital ecosystem that maximizes the effectiveness of their business model. At the same time, the low barriers of entry bring another key challenge: “how to find the right digital strategy?”
‘Digital and Technology disruption’ is about managing risks and opportunities at the same time. We esteem that the hoteliers’ challenge starts at very beginning: ‘defining the digital strategy, risks and opportunities’. Most hoteliers struggle to discover the digital opportunities or risks of today and tomorrow. How to exploit technology most effectively as an accelerator for its’ business and what kind of technology to use? With many opportunities and risks, it is not easy to find the trees in the forest.
To answer the question, we advise to see first the big picture and then chunk down the ideas from general thoughts, macroeconomics and consumer trends towards hotel specific answers. We illustrate with one concrete example that could help to define the digital strategy of a hotel.
Start to ask general questions “who is the customer?” and “what does the customer expect?”. We need to understand the potential customer of today and tomorrow by looking at the consumer behaviour, macroeconomics and statistics. About 60-65% of world population is under 40 years, a large part of them (generation Y, Z) are “smartphone zombies”, walking permanently with a smartphone in their hands or within permanent reach, most of population communicates by mobile and consider digital peers as friends, people engage in average about 50-100 times per day with their smartphone, etc. Clearly, we believe that ‘mobile interaction’ becomes the highway to connect with the hotel guests or potential customers; therefor it is definitely one of the horses to bet on!
Secondly, we define in what context hotels are operating. How is “mobile” a disrupting factor to the industry, today and tomorrow? Within hospitality technology, the success of mobile has grown faster as desktop solutions. According to the article, “Important mobile booking stats for hotels in 2018” published by Steffan Berelowitz, VP Digital platforms at Pegasus, 45% of all OTA bookings are on mobile (2018). In some countries, this figure is even above 50%. Ten years ago, it even did not represent 5%! Hereby facts on the mobile consumer behaviour within the hotel industry confirm the empirical evidence: ‘mobile interaction’ is the future.
Finally yet importantly, is to find a solution that embraces the mobile opportunities to optimize its’ business and implement it. Does the hotelier has a mobile app that offers a fast and frictionless experience, seduces the consumer in a micro-moment to buy or simply reaches the target audience? Does the hotelier engage per mobile with his guests before, during or after the hotel stay? If the answers are ‘no’, the hotelier misses the boat. We advise to browse around for the numerous solutions that already exist and help to build an ecosystem as one integrated “mobile” strategy.
To conclude the article, it has become clear that within this fast moving era, it is indispensable to see the big picture and act agile so opportunities do not turn into risks or losses. A technical skill- and mind-set help to remain competitive within the contemporary hotel industry. Luckily, with help of continuous democratisation and more and more integrations, many opportunities to interact with the potential hotel guest are within hand reach. We hope you do not miss your digital opportunity!
Jochen de Peuter Consultant at EHL Advisory Services
As a Consultant in the Lausanne office, Jochen puts the customer at the center of his approach. With efficient use of resources and well-determined activities, Jochen commits to creating significant added value for the customer and therefore a positive return on investment for the business. He is convinced that digital transformation, constant innovation, employee education and customer focus are fundamentals for a successful business. Prior to joining EHL Advisory, Jochen worked in the online hotel distribution and hotel technology industry. He has proven outstanding results in customer acquisition, business development in new markets and relationship management across various markets in Europe. Jochen operated in demanding and fast evolving work environments. This setting helped him to collaborate and think with the team so as to stay ahead of competition. Jochen holds an academical degree in economics and business administration, a post graduate degree in hospitality operations and an Excecutive MBA from IESE business school. He is a native Dutch speaker, business fluent in English, German, French and can communicate in Russian. Areas of Focus: