North American Hospitality Technology and the Rise of the Mobile Traveler

How is hotel technology empowering North American hospitality to better serve its modern staff and guests?

North American hospitality has rebounded quickly following the economic recession, leading to a period of relative prosperity in recent years. Reports project that hotel occupancy rates will continue to break records through 2017, translating into increases in room rates and new development.

Despite this success, North American hospitality businesses are facing a number of challenges, many of which can be addressed with strategic implementation of hotel technology.

Sixty-four percent of U.S. adults now own smartphones, a figure that has nearly doubled since 2011. Not to mention the fact that about half of smartphone owners believe they “couldn’t live” without a mobile device.

In Canada, the number of adults who own smartphones reaches 68 percent, and the Caribbean mobile market has exhibited promising growth in recent years.

Given these numbers, it isn’t surprising that the popularity of hotel apps for communication and services, like booking and mobile check-in, is on the rise. In 2014, 40 percent of people in the U.S. used their mobile devices to book travel reservations. Some of the other services that guests have responded well to include:

  • Receiving assistance from staff
  • Making requests to housekeeping or operations
  • Maps and directions
  • Controlling room settings
  • Ordering room service

Hotel occupancy rates will continue to break records through 2017, translating into increases in room rates and new development.

The United Nations World Tourism Organization (UNWTO) forecasts that more than 300 million people in the Millennial demographic, ages 18 to 30, will travel to North America in 2020, expanding at a rate of 9 percent per year compared with 2 percent for other age ranges. As Millennials, these travelers are proven to place a high value on mobile as an integral part of the travel experience, and the more successful North American hospitality industry players with this group will be the ones who strategically leverage mobile devices as a means to communicate with and attract prospective guests.

Optimistic predictions for leisure travel are tempered by anticipated slowdowns in business travel, though, which could lead to increased competition among North American hospitality to secure bookings.

“While total committed occupancy for 2016 is off to a strong start…business demand pace has slowed, creating greater dependency on hoteliers to offset the slowing pace with discounted leisure and promotional bookings,” said John Hach, TravelClick’s senior industry analyst. “As a result, hoteliers must ensure that they are measuring and monitoring local advance booking trends across all channels to reach their 2016 revenue per available room objectives.”

Hotel technology will be a key factor in gaining a competitive edge, as business travelers have been shown to be more interested than leisure travelers in the ability to actively use mobile devices for communication and convenience during travel. Nearly 100 percent of U.S. business travelers own a smartphone, and it’s average for one in this group to carry three to four devices with them. Ninety percent expect hotel WiFi access.

Offering hotel technology, such as widespread WiFi access, in-room tablets or a hotel app, could all contribute to securing corporate and group business, as well as winning loyalty.

Another challenge facing North American hospitality relates to labor. Labor costs are a dominant expense for hotels in the Caribbean, Canada and the U.S. Apart from costs, issues relating to staffing include low employee satisfaction, insufficient productivity, and high turnover rates. Hotel staff is the face of a hospitality brand, so having unmotivated employees can be an impediment to ensuring that guests are engaged and well served.

Oftentimes, a lack of sophisticated hotel technology results in requiring staff to perform manual, tedious tasks, such as managing handwritten tickets and relaying guest information across multiple departments. New hotel systems ease this burden by automating operating processes. More hotel staff are left free to spend time focusing on addressing guest concerns and providing outstanding service. In addition, labor costs can be controlled more efficiently by employing technology to take on a lot of the basic, daily repetitive tasks.

Implementation of hotel technology can also assist North American hoteliers in succeeding when it comes to other initiatives as well, such as the push for green hotels.

“Going green has become a cost-saving trend in the Caribbean,” said Scott Smith, MAI, senior vice president of PKF Consulting. “Investing in sustainable energy has become very important to hotels in the region. While utility costs in the Caribbean may be high right now, I expect that the use of sustainable technologies will help reduce energy costs in the future.”

Developments in hotel technology have allowed hoteliers to begin the reduction of operating costs with advanced functions such as automated room controls. These allow the hotel to set up sensors that allow automatic adjustments to lighting and energy use in rooms depending on factors such as time of day, temperature and human presence. It’s part of the smart hotel trend that ties in with the expansion of the hotel Internet of Things.

Providing guests with the ability to control the room environment through in-room tablets or mobile devices also adds to enhanced brand perception and overall guest satisfaction.

To learn more about how North American hotels are improving the guest experience with hospitality technology, read about the digital experiences of our clients throughout the continent.