We recently kicked off our latest series, “The Evolution of Hospitality Technology,” chatting with five industry veterans and Shiji experts about their experiences watching the hospitality technology space evolve, from pre-internet days, up through today, and looking forward to what the future might hold.
In part one, we looked at the early days, setting the stage for part two, below, discussing a period of notable growth in the travel and hospitality technology industry.
The conversation continues from part one, turning our focus to how things have changed in each of our subjects’ own areas of expertise. We wanted to know what the major points of inflection in terms of consumer behavior or technological growth were.
Jill Boegel: I started checking people in at the front desk at the Holiday Inn in New Orleans. And then, three months later, I moved over to Hilton and spent 13 years with Hilton’s Front Office Operations and Revenue Management. And when I think about it now, back then I would place handwritten messages for guests in an actual physical box. You had a different system you worked in for checking people in and a different one for checking them out, all with DOS commands, it was crazy.
When I started in Revenue Management, it didn’t even exist as a discipline. It was like, “We’ve got to do this thing. You’re one of five people, so we’re going to send you to Arizona, go figure it out.” At the time, their Property Management System and Reservation System didn’t speak to each other. So, you were manually managing rates and inventory between the systems. There was no such thing as Revenue Management Systems.
Then all of a sudden, the OTAs came along and it was like, “Okay, let me create this Excel spreadsheet to manually type in the rates that I’m charging in my own system, the margins that they’re going to take for me, and the rate I have to load in.” We were trying to create Excel spreadsheets to help us understand all this data that is now easily aggregated. I look at what we sell today as a company, and how much easier and more efficient we’ve made the life of the hotelier. It’s dramatic.
On the tech side, what surprises me now, is that some people still don’t understand the value of hospitality technology. A lot of hoteliers still put emphasis on ROI, but not all technology is going to have an immediately strong ROI. Sometimes the value is in operational efficiencies or saving your staff time.
“The move to the cloud has been huge. It’s provided the agility to do things faster. Back in the day, there used to be a big processor or server that was the size of a room and was two feet wide by eight feet high.” Dan Bell, SVP Shiji Americas
Demanding that the various systems communicate with each other through solid APIs seems obvious now, but it wasn’t always the case, as Dean recalls from dealing with simple things like door-locks.
Dean Dilullo: For me, it was all mobile and digital. During my time at Marriott for the last 10 or 12 years of being there, it was all about how the customer does everything they want to do with their own device. Don’t hand me a device, don’t hand me a tablet. I need to be able to do it on my own device.
An example would be the electronic door lock vendors in our industry. They were making punch cards, the cards with the holes in them, and then that moved to magnetic stripe cards and next RFID. And then we were saying to them, “I want the customer to just use their phone to open the door,” and they would look at you like you had three heads and horns coming out of your head.
And then we have the challenge of IT investments. Moving from a large capital expense of servers to an operating expense of cloud based solutions is still a transition in the hotel industry. Dan Bell has seen the shift from the front row.
Dan Bell: The move to the cloud has been huge. It’s provided the agility to do things faster. Back in the day, there used to be a big processor or server that was the size of a room and was two feet wide by eight feet high. Then came the advent of the PC, but they were premise-based solutions that were very transactional in nature.
On a macro level, the level of competition has increased dramatically among the brands for one, and then with the advent of Airbnb and Vrbo, those are now competition for the industry as well.
On the topic of hotel distribution and the constant challenge of one’s distribution mix, Natalie recalls how things evolved over the years. That give and take between OTA distribution and brand.com tends to settle, but it also comes undone quite frequently.
Natalie Kimball: Today, it’s a tightrope. It doesn’t feel like cooperation, it feels like ‘coope-tition’ because it’s always about brand.com. So there’s this constant tug of war now, where people think about tech as the 100-pound gorilla. “I have to work with Expedia. I have to work with Booking.” Well, do you? I don’t have to drive a car, but I choose to, so I have one that I enjoy driving. I feel that it’s always been this tug of war. The hotels were in control. Then, the OTAs were in control. And then when 9/11 hit, the OTAs were back in control. Afterwards, brand.com became more important, so hotels took back control. Now, there’s the recession and COVID, and it’s just this constant give and take. There is an opportunity to be on equal footing, and say, “Look, we understand that you want 50% of your traffic to go to brand.com, help us do that with you,” as opposed to having the mentality of, “I have to do this even if I don’t want to.”
Stay tuned for Part Three of the Evolution of Hospitality Tech series where we look at how mindsets changed and what the future could hold for the industry.