IDeaS, a provider of hotel revenue management software and services, released Future Forecast: Six Hotel Technology Predictions for 2024. Gathering information from some of the top minds in the industry, IDeaS released six hotel technology predictions that it believes will shape the year to come.
“Our team engaged with some of the greatest minds in our industry in 2023 through informative webinars, a successful client summit, and our ongoing commitment to supporting innovation and industry events,” said Mike Chuma, vice president of global marketing at IDeaS. “It is clear to all of us that 2024 is shaping up to be a year of substantial and exciting change—and the best way for hoteliers to take advantage of that change is to start thinking now about what’s likely to come in the year ahead.”
Key predictions include:
The continued breakdown of hospitality data silos
The hospitality industry collects an incredible amount of valuable guest data, but it’s often coming from disparate sources with no clear view of the entire guest experience. IDeaS foresees this changing fast as hoteliers look to maximise the value and power of their data in 2024. You don’t need to take a long look at your property’s technology stack to understand that this industry collects an incredible amount of data. IDeaS believes this progress will continue in 2024 as more organisations embrace cloud-based data platforms and hoteliers understand the value of ensuring their technology systems work well together. For hoteliers, that means a much more holistic and clearer view of their guests’ total profit potential, bringing the importance of cross-departmental decision-making into acute focus.
Revenue management will leave the confines of hotel walls
The discipline of revenue management is poised to expand beyond its traditional home within hotels. Campsites, “glamp-sites,” cruise ships, and other forms of outdoor accommodations remain incredibly popular. With at- or above-capacity cruise lines looking over the fence at what their similar-but-different friends in hotels are accomplishing with revenue management practices, we believe it’s only a matter of time before this discipline starts stepping out—and up—to meet the needs of these markets. Additionally, with cloud computing technology and mobile applications providing increased flexibility for how and where revenue managers tend to their business, the discipline of revenue management is poised to get out and about more than ever before.
AI is set to redefine the guest experience
2023 was undoubtedly a flashy year for generative AI, with tools like ChatGPT, Bard and DALL-E generating scores of headlines and lofty think pieces about the implications of their widespread application. In 2024, we believe generative AI will stay in the spotlight. Still, the focus will shift away from far-flung philosophical debates to seeing how these technologies will start reshaping the hospitality industry (among others.)
Connected commercial organisation model takes hold
The need for hospitality providers to build a “connected commercial organisation”—where revenue management, sales and marketing are aligned and working toward a shared set of goals—is readily apparent. Instead of repeating a constant cycle of conflicting actions and tactics stemming from misaligned metrics (and the bonuses tied to them), we predict hoteliers will take significant steps to realign their businesses to a connected commercial model that prioritises profitability over everything.
Meetings and events revenue management masters will have a head start on total revenue optimisation
In 2024, meetings are predicted to recover to 133.5 per cent of 2019 levels, according to Knowland. Forward-thinking hoteliers understand that they need to look beyond room revenue to maximise the value of their property. With as much as 60 per cent of hotel revenue originating from the meetings and events (M&E) business, this business segment is the next hill to conquer on the path to a total revenue optimisation future. A hotel’s revenue maximisation success depends on a cohesive M&E strategy that aims to ensure every square foot or meter of event space is used to its full revenue-generating potential—and IDeaS believes more hotels are ready to branch out into their next revenue management frontier in 2024.
Profit optimisation moves from “nice to have” to “must-have”
Hoteliers have already felt the sting of inflation and higher labour costs. And now the recent era of “easy money” low-interest rates is over as central banks look to tamp down inflation. This adds ballooning borrowing and debt servicing costs into the mix for many. Investors’ share of the revenue pie has become much smaller, with less appetising capitalisation rates. Because of this increased and sustained financial pressure, we predict that more hoteliers will go beyond revenue optimisation and make significant strides toward total profit optimisation.
Download the entire report at Future Forecast: Six Hotel Technology Predictions for 2024.