After the COVID-19 pandemic significantly impacted the European hospitality industry, forcing hoteliers to adapt to rapidly changing market conditions and shifting consumer behavior, a sense of normalcy has finally returned. Despite high air and hotel rates, Europe hotels experienced an exceptionally strong summer travel season in 2023 and are expected to see yet another strong season this year.
During the 2024 International Hospitality Investment Forum in Berlin, STR Managing Director Robin Rossmann suggested an overarching sense of optimism, specifically for the second and third quarters of 2024. Part of the increasing strength for 2024 is improving business travel, which supplements the strong leisure travel seen last summer, Rossmann said.
"We can tell you that [Q3] will be stronger than it was last year," he said. "I thought we wouldn't have a summer that was as strong as last year, but it turns out it will be."
With that in mind, hoteliers in Europe are turning their attention to capitalizing on new segments of demand and curtailing the rising operating costs that came along with COVID. To do, so many are turning to technology, which promises increased efficiency and production across all departments of hotel operations. And with modern technology investments comes new data sets that can be used to make smarter decisions across the business, from labor management to revenue management to distribution optimization.
Let’s look at three key strategies hoteliers are implementing in 2024 to help them drive revenue, reduce costs, and enhance the guest experience.
Technology has ushered in a new era of efficiency and productivity for hotels. One of its key advantages lies in the automation of processes and the elimination of manual tasks. The automation of back-office operational tasks is emerging as a crucial strategy to counter rising operating costs. Hoteliers can leverage technology like Otelier DigiAudit to focus on areas that enhance efficiency without compromising the guest experience. Automation in accounting, finance, revenue, and marketing can significantly reduce the manual workload, allowing staff to focus on more strategic aspects of their roles.
Some areas of hotel operations that are being transformed by automation include:
In 2024, our hotel guests are expecting a personalized experience. Hoteliers should focus on building direct relationships with guests through all available touchpoints, using analytics to create targeted marketing campaigns and customized experiences.
Offering tailored recommendations based on guests' interests or purchasing history can enhance the guest experience and increase the likelihood of repeat visits. Personalization can also be used to provide guests with customized in-room amenities, along messaging to communicate with guests before, during, and after their stay. By building direct relationships with guests, hoteliers can enhance the guest experience and increase guest loyalty, ultimately leading to increased revenue and profitability.
In Hospitality Labs, NH Hotels’ Chief Commercial Officer Fernando Vives says modern travelers demand memorable, personalized experiences that align precisely with their individual preferences. Yet, he says, “the conventional hotel booking process — with its reliance on pre-defined room types and rigid rate plans — often falls short of delivering such tailored experiences.”
Vives suggests attribute-based selling offers unprecedented personalization and flexibility, potentially revolutionizing the guest experience while empowering hoteliers to better meet and exceed guest expectations. However, the conventional method of hotel booking that relies on static room types and rate plans often limits personalization, he says.
The increased availability of analytics is reshaping all areas of hotel operations, allowing hotels to make smarter, data-driven decisions that improve guest satisfaction, drive revenue, and reduce operating costs.
While the roll-out of guest-facing technology continues, internal business intelligence systems like Otelier IntelliSight will play a key role as hoteliers seek to safeguard profitability in the face of inflation. The current trend, according to a recent EHL Insights report, is moving away from simply collecting data to engineering and analyzing vast amounts of data efficiently to enable actionable recommendations and gain an edge over competitors.
Speaking at the HOSPACE conference in November, Kate Nicholls, CEO of UKHospitality, predicted that hotels will focus in 2024 on deploying business intelligence tools to analyze data and consumer preferences, according to Hospitality Investor coverage.
“You are finding that you need to drill down into the detail of the business to find out what works, and you need data to make those decisions,” she said. “Then you can find the technology to automate the mundane, which frees up your team to deliver the valuable experience, because only a person can deliver an experience and, quite frankly, that’s what your guests are paying for. That’s where the pent-up demand is still coming from.”
European hoteliers who invest in technology to help automate mundane tasks, personalize guest experiences, and turn analytics into action will be well-positioned to thrive in 2024. By tapping into new demand segments while also addressing the escalating operating costs that followed in the wake of COVID, hoteliers can boost productivity and profitability throughout all areas of hotel operations.