By Jeff Bzdawka, CEO | Knowland
As our teams traveled to industry shows and visited customers throughout the year, many conversations expressed frustration about the ongoing need to bring together key data sources and numerous technology systems. We’ve talked about it before, and indeed, it will be an ongoing challenge for hoteliers and their technology vendors as they look to consolidate the growing data ocean and wrangle it into a cohesive, streamlined workflow that provides actionable insights leading to better results.
It has been a year of changes and challenges. But we believe great challenges are the enablers of great change. So, with that in mind, let’s look at some of the key challenges facing our industry in the coming year.
Resiliency and Growth as Challenges Continue
The travel and hospitality sectors depend on a higher degree of stability and certainty to flourish. The world is walking on eggshells right now. With growing geopolitical and economic challenges, it can feel as if we are caught in a state of limbo, on the brink of breakaway growth, and hitting the bottom simultaneously.
While our industry is bouncing back, 2023 brought significant challenges to the table, many of which will linger into 2024 and beyond.
Key Obstacles Ahead:
- The evolution of the working environment (return to office vs. fully remote vs. hybrid.)
- The increasing cost of capital and the pending crisis in commercial real estate continue to constrain investments that hotel owners can make.
- Downward pressure on operating profits due to rising operating costs may hamper investment in technologies, particularly AI.
- Proliferation of technology solutions.
- Increased confusion and separation of booking brands and stay brands with major technology players making a strong play to ‘own the customer.’
- Aging assets requiring investment will need to be addressed. The underinvestment in aging assets over the past three years will certainly need attention. The hospitality industry must mitigate this issue by prioritizing reinvestment in aging assets.
- Geopolitical issues and cross-border conflicts create a FUD (Fear, Uncertainty, and Doubt) factor.
While these challenges may paint a dark picture, the hospitality industry continues to demonstrate its resiliency. We’ve seen a bit of stabilization in the new normal, as recent reports have shown. Revenge travel, primarily fueled by leisure, is plateauing and settling into similar seasonality trends of the past.
Group business is surging, as evidenced by the recent success and record-breaking attendance at IMEX. Business travel is figuring itself out as the working environment evolves.
Leveraging Technology to Solve Tomorrow’s Challenges
What do the above challenges have to do with the importance of technology integration? As we look ahead to 2024 and back at the events of 2023, technology is evolving so rapidly that industry leaders may not have the time or resources to assimilate everything coming at them.
Indeed, the proliferation of data is making it easier to mine for actionable insights with AI, enabling complete revenue management across all aspects of the hospitality experience. But where does that leave us as we look to consolidate and coordinate technology across portfolios?
We have learned the necessity of bringing new and existing staff up to speed quickly and efficiently in the use of technology and business applications. We’ve also learned that failure to do so will result in frustration, abandonment of the technology at the property level, or, worse, system mismanagement. This can result in higher direct and indirect costs.
For hoteliers actively working on rebuilding and retooling, a critical area of focus in these efforts must be ensuring that the technology in place is working correctly and being used to its full advantage. At the very minimum, it is vital first to implement tools that actively monitor technology investments, ensuring they function as promised, and second to reveal if staff is using them efficiently.
The growth of data insights enables hoteliers to know guests better and create more personalized experiences. It also provides better insights into operational inefficiencies to optimize labor utilization. The evolution of Generative AI combined with Big Data will undoubtedly enhance and increase our ability to leverage data insights.
Change is Constant in the Hospitality Industry
As we move ahead, we don’t know what lies ahead. We can be afraid of turmoil, or we can try to leverage it.
Prolific author and speaker Alan Watts said it best, “The only way to make sense out of change is to plunge into it, move with it, and join the dance.”
We don’t know about you, but we would rather dance than huddle in a corner. Let’s step into the next challenge with determination and an eye on growth.
You don’t have to face the ups and downs of the industry alone. With Knowland by your side, you can unlock key data and automation to empower your property.