A new year comes with new demands from brands on technology. Hotel owners, operators and asset managers offered up advice on how to balance needs and wants as well as what their top investment priorities are for the year.
REPORT FROM THE U.S.—For hotel owners and operators, making technology investments is all about creating balance between guest needs and brand wants, according to sources.
But as 2020 comes with more tech demands, there’s sometimes a requirement for owners to pushback or redirect expenses.
Chris Manley, COO, Stonebridge Companies, a Denver-based ownership, management and development company, said his team is always in constant communication with the brands about which investments will help both the guest experience and the property’s bottom line.
“The great thing about our industry is that with the number of rooms in each hotel, we’re able to A/B test new and different technologies to see what resonates with our guests and team members. If something doesn’t work, we can redirect quickly and with less investment loss than other industries,” he said in an email interview.
Joseph Bojanowski, president at PM Hotel Group, a Maryland-based management company, said in an email interview his company serves on advisory boards and councils with all of the major brands, and they generally are in line with owners’ objectives.
“We find the brands are very open to discussion about return on investment and achievement of owner financial objectives and are, in general, seeking a balanced approach ensuring that there is a balance between the guest, brand and owner perspective when considering new technology,” he said.
Larry Trabulsi, EVP at asset management company CHMWarnick, said his team will often ask the GM of a property to explain the rationale behind projects.
“If they can’t explain it at the first blush, it’s not exactly a top priority,” he said.
Top investments for 2020
Manley said Stonebridge Companies is aggressively investing in and rolling out algorithm-based solutions related to staffing and scheduling to aid team members.
The company also made a “major investment” into a new applicant tracking system to help increase candidate flow. He said early results are encouraging, and it’s helping his team tackle “one of the biggest issues in our industry: filling open positions.”
Although it’s been around for quite some time, mobile key is still a top priority for guest-facing technology in 2020, he said.
“I think you’ll see it become both mainstream and a guest expectation over the next 12-18 months,” he said.
Manley said upgrading Wi-Fi is always critical and has become “as much of a guest expectation as hot water.” He said both the brands and operators are closely watching the rollout of 5G to see how it ultimately impacts the delivery of data in hotels.
“It has the potential to dramatically enhance the guest experience while at the same time rendering a lot of previous investments obsolete,” he said.
There’s room for more investment in enhancing the booking phase, and the brands have done a great job so far implementing sophisticated algorithms to help guide pricing and revenue strategy, Manley added.
Bojanowski said guests are continually wanting tech that delivers all their check-in/check-out and in-room needs. He said his company is investing in app capabilities so that the “brands and our hotels are less vulnerable to disruption from current and future technology platforms that target our guests.”
He said there is “no end in sight” to the labor shortage in hotels, and PM Hotel Group is putting money towards technology that will allow greater back-of-house efficiencies without compromising the human element of service. For example, he said robotics and artificial intelligence are great alternatives for completing repetitive actions that otherwise an employee would do.
Trabulsi said he’s starting to see more of a demand for mobile technology in terms of mobile pay at hotel restaurants and more portable devices for housekeepers. However, with that comes an influx of people carrying devices, so the wireless service that is provided needs to be exceptional, he said.
This year, CHMW’s clients are focused on investing in alert systems for employees.
“That’s been a big push from Marriott International this year, so we’re spending a fair amount of money on that,” he said.
In addition to that, CHMW is focusing on projects with a return on investment, such as tech that will help eliminate energy and water usage.
What are owners hesitant to invest in?
Bojanowski said some owners are pushing back on infrastructure improvements required in the hotels to execute on the technology initiatives because of how expensive and redundant it can be.
“These are expensive and disruptive projects and there needs to be extended shelf life to the type and capacity of the wiring and hardware being used to build out a new infrastructure in a hotel,” he said.
Trabulsi said it often varies where the pushback is, but in-room technology tends to be one area.
It’s tough for brands to be cutting edge, he said, whereas at smaller chains or boutiques it’s easier to be a lot more nimble.
“You might have some owners that are willing to take the chance, (but when) dealing in a brand-managed environment, it just takes time vetting the systems,” he said. “You just have to be understanding why (owners) chose a certain path.”