Technology in the hospitality industry globally has grown monumentally in terms of its application accuracy and features, be it at the back-end or the front office operations. Leading indigenous hospitality technology providers share their insights on the demand and supply of smart technology in the domestic hospitality market which however, still remains in the nascent stage, with a fair share of the market still remaining untouched by tech By Akshay Nayak
With the increasing use of smartphones since the past 10 years and worldwide penetration of internet, the modern-day tech-savvy travellers, especially the millennials, are well aware of most of the technologies across the spectrum of diverse applications. In fact, tech-driven services have become the need of the hour for them. Looking at this demand, travel tech didn’t take much time to become a prospering segment, with numerous startups mushrooming in this space; providing vivid first-of-their-kind services. Be it booking a ticket online, issuing e-visa, or planning a whole itinerary of their upcoming trip, many startups pumped in millions of monies from investors. A KPMG FICCI report titled ‘Expedition 3.0: Travel and hospitality gone digital’ also reads that the travel and hospitality sector is rapidly evolving with the rising adoption of various tools, technologies, and digital platforms – primarily to improve customer experience, build strong loyalties and run businesses efficiently. These include mobile applications, social media, Big Data analytics, artificial intelligence (AI) and machine learning, virtual reality (VR) and augmented reality (AR).
The global hospitality industry as a whole also has embraced growth with some revolutionary technological advancements. The boom of hotel metasearch engines, OTAs, in-room mobile accessible technology, chatbots, online review/ testimonials pages, etc., make it all evident that the hospitality industry is also striving to cater to the modern-day travellers with seamless and memorable stay experiences. The trend which initially was predominant in the western countries has increasingly become evident in Asia as well for the reason that the tech-savvy millennial traveller market is booming in this continent.
Jones Lang LaSalle (JLL), a leading commercial real estate services firm had also published an article last year which contained certain key notes of rising trend of use of state-of-the-art technology by hotels in Asia. It read that in Japan, self-parking slippers and furniture are able to return to their designated spots after use. A blockchain reward system introduced by Malaysian hospitality firm Hatten Group allows members to collect tokens in exchange for hotel packages and stays. Meanwhile, Andaz Singapore and Hotel New Otani in Tokyo have introduced chatbots for guests as a handy way of providing recommendations and answer anyqueries.
Indian hotel tech supply in-line with global trends
India doesn’t fall short to meet these globally popular hospitality tech trends wherein it has one or the other technology services providing brands catering to the diverse needs of hotels spread across the expanse of the country. Be it the require ment of a channel manager, booking engine, reputation management system, revenue management system or any other need, the solutions are stacked at the disposal of over a dozen of homegrown brands which excel in hotel technology. Supporting the statement, Anil Kumar Prasanna, CEO, AxisRooms – a Bengaluru based hotel technology services providing company, says, “Indian startups in the hospitality industry is dominant irrespective of large world brands, they all are using a product built and delivered by Indian IT services company or in terms of product startup we have plenty of them. We are one of the first and prime movers even in AI, machine learning and gaining insights for forecasting and revenue management systems.”
Furthermore, the Expedition 3.0 report mentions that India’s travel sector has expanded in recent years, driven by the increase in domestic spend, internet penetration, and availability of smartphones. Budding popularity of such applications backed by user-generated content and sharing economy services has opened the door for many new travel start-ups, offering choices to tech-friendly travellers. In addition, online sale of travel bookings in India is expected to increase at a healthy rate of 14.8 per cent Compound Annual Growth Rate (CAGR) from Rs 1,512.7 billion (US$ 22.3 billion) in 2017 to Rs 2,625.7 billion (US$ 38.7 billion) by 2021.
With such staggering supply of technology solutions available for the Indian travel and hospitality market, and growth predictions eyeing a double-digit growth, what really remains a quest is the implementation of these assorted technology services across the swollen inventory of hotels throughout the length and breadth of the country.
The Indian hospitality industry also harnesses technology for various tasks and to leverage the guest experience. But however, it still remains in nascent stage, with a fair share of the market still remaining untouched by tech.
Recognising that the Indian hospitality industry still has a major chunk that remains untouched by any technological advancements, Sunil VG, CEO, Otel Technologies – a hospitality technology services provider also based out of Bengaluru, says that we can find Records maintained in smaller hotels that are still non-digitised, and the lack of technology in hotels increases the required manpower but reduces perfection. Adding to this, Prasanna of AxisRooms informs, “There are still 30K+ hotels in India which do not have or use technology like channel manager, property management systems, etc, among others.”
To answer this sluggish implementation of technology in India, one needs to understand that globally, the shortcoming that is prevalent in hotel tech at large is the complexity of integration of multiple technology services. “Hospitality industry being multi-sector is quite complicated; and use of legacy systems which are usually out of date, adds further to the complexity. Another complex aspect is integration. Being able to integrate all the software efficiently and ensuring that the integrated software is accurately communicating with each other, in real time, is among the key challenges,” remarks Gavin Jeddo, CEO, STAAH – a hotel technology solutions provider. Likewise, Prasanna also adds, “The shortcoming we see is the technology which has scattered too many modules, even if we pick an Indian branded hotel chain, they use at least five different vendors for products like PMS, Channel Manager, CRS, Content Management System, etc., and integration is not seamless. I think there is a huge opportunity to be a one suite product with all functionalities.”
Aditya Sanghi, CEO and co-founder, Hotelogix – a cloud-based property management software provider, opining similar views, says, “Being monolithic in application architecture, on-premise PMS lacks integration capabilities with many other operationally imperative third-party solutions. That’s the reason, in today’s digital travel world, the on-premise system is not the right choice for hoteliers. Contrary to this, cloud-based technology seamlessly enables collaboration and makes itself a natural fit to the constantly evolving hospitality eco-system.”
In accordance with the other respondent’s sentiments, Navin Ladha, CEO, RanceLab – a full-suite technology solutions provider to the hospitality industry feels that the introduction of new technologies and service platforms in the food and hospitality industry has made it susceptible to many threats which add up to its existing challenges such as data management, security & privacy, food costing, and more. Furthermore, the hotels sector in India is a mix of international hotel brands, homegrown chains of hotels, aggregator models, and then the standalone hotels. These are spread ubiquitously across the country and hence reaching out individually to each one becomes a cumbersome task.
However, despite of all these headwinds, the industry views are that, the Indian hospitality industry is progressing slowly and steadily to meet the internationally applied smart hospitality technology standards. Many state-of-the-art unique hotel technology solutions are implemented and also boasted of by several hotels in the country. At the recently concluded HICSA, leading hotel company Radisson Hotel Group (RHG) said that their unified technology solution – Emma (Every Moment Matters) will be unveiled in India with the launch of Radisson Red Mohali which is scheduled to open in Q4 this year.
Agreeing that the Indian hospitality market is progressing in adoption of technology, Sanghi feels, “We have seen hotel technology in developed nations like the USA and Europe, and Indian hospitality industry is also going through consolidation and digitisation, hence we are witnessing rapid expansion of multi-property hotel groups and high adoption of digital travel.” Manoj Mohanty, senior VP – Sales (South Asia & SE Asia), IDS Next – a leading full-suite hospitality solutions provider, also notes that technology adoption in the Indian hospitality industry is gaining momentum. But it is still slow paced.
Ladha says that the the hospitality industry in India, especially the restaurant space has been growing fast over the years. “It can be said that it is the most fast paced industry in terms of experimenting with all new sources of technology. The restaurant owners are more tech savvy than ever for keeping an easy, faster process and pleasing their customers at the same time,” he adds.
Need to educate the decision makers
The notable reasons behind the persistent gap that still remains in the industry are the hoteliers’ lack of knowledge about the availability of such technology services and implementation of the same in their hotels. The technology providers also feel that although new startups are coming with unique tech-driven solutions for hotels, the hospitality sector still vouches on its age-old cookie-cutter technology which has probably lost its charm with the changing times. Backing this statement, Sanghi opines, “Market dynamics have changed so quickly in the last few years that the on-premise technology is now irrelevant and out of sync with the current needs. However, there is a strong resistance to let go of existing systems and the same is causing a delay in switching. This delay is hurting their business, and in other words, we call it – loss in opportunity cost.”
VG of Otel Technologies adds, “What we in Indian hospitality even today follow is the age-old method of operation. Yes, there is incorporation of technology but that too is limited mainly to promote, review and sell at competitive pricing. Indian hotels have a long way to go in creating hotels wherein everything from check-in to check-out is automated.”
Lack of information is a concern hampering the application of new-age technology in hotels. Prasanna opines that they as technology providers need to bridge the gap which can be done only by educating the hotels about new-age products. Acknowledging that there is a challenge of shortage of skilled personnel, especially with respect to revenue management, Jeddo informs that STAAH is helping address this, by partnering with ARMA (Australian Revenue Management Association) to offer free basic course modules to hoteliers for achieving revenue growth, with an option to discounted pricing on advanced modules. “Also, playing a part in shaping the future, STAAH conducts periodic workshops in India, at Hotel Management Institutes to mentor and help bridge any gap between here and international standards,” Jeddo points out.
Alternatively, the industry experts have witnessed that hoteliers and restaurateurs show skeptical adoption of technology handling consumer data because of the presumed notion of theft of sensitive data of their consumers. Ladha informs that RanceLab helps its customers in overcoming these challenges by providing an efficient management system that enables business owners to carry out smooth operations and manage various aspects of the business like the influx of large quantities of data from a variety of sources and access in depth information about its customers, products or any other business related data at any given time. It also ensures that interactions with guests /customers and related transactions are secured by employing robust security measures to prevent data leaks and theft which are among the most common causes for revenue loss in any business and gives them complete control over its system operations.
The way ahead
Having mentioned that Indians need to pick up with the globally popular hotel technology, the technology solutions providers suggest certain ongoing global trends that could change the way they function in a positive way. The respondents chalk out that personalised services are what remains the epitome for guests. Hence, use of a lot of big data analytics to learn a guest’s likes and dislikes; IoT in-room equipment to make services such as switching the AC, or toggling the lights, etc, readily available on their smartphones; use of artificial intelligence to suggest the guests on further engagements with reference to earlier held records, will be the key drivers of hotel technology for a long time from now. The Indian hospitality industry has the supply of all these technology services, but it should be picked up soon by the hoteliers, is what the technology providers feel.
Jeddo observes, “India is experiencing increased internet penetration, which continues to grow at a fast pace. And with the emergence of smartphones, providing easy access to the internet and various applications, online bookings have emerged as a major revenue contributor. Guest experiences have enhanced right from the time, the travel thought is incepted to repeat travel thought. Digital marketing, including social media, has made inroads in driving customer decisions by personalised targeting and displaying personalised feed. “Hotel websites are able to lure customers with smart and attractive pricing, 360-degree VR imagery, chatbots, secure payment gateways, and of the like. Guest stay is enhanced by the use of robots, smart IoT devices, face recognition technologies, augmented reality et al. Guest experience is also directive of online reviews which help in understanding the culture and commitment of the company, and aids in building trust and making decisions,” he adds.
Prasanna reiterates that use of data, IoT, guest data, preferences, revenue optimisation, communication, etc., are the future adoptions required by the hospitality industry and current technologies are still in basic stage and there is a larger opportunity for this technology to scale. Deeper the insights, hotels can work on gains like a higher business, cost optimisation, etc.
“The industry is doing its best to engage with their Guest to enhance Guest Experience, for which, hotels are now offering online 24×7 connect with the guest, pre-selection of rooms, self-check-in’s, keyless entry, in room automation through Amazon Alexa, from controlling the television channels, air conditioning system , to book a spa and placing request to housekeeping and or room service, adoption of technology is everywhere,” notes Mohanty.
Recognising that the modern-day guests strive experiences, Tarun Goyal, founder & CEO, Simplotel Technologies, affirms that hotels these days need to provide their guests with personalised experiences. He adds, “Today’s guest is looking for an experience – more than a stay. And, the experience is always personalised. Today if you look at an OTA such as a MakeMyTrip, it remembers what you have searched for and if you don’t book and come back to the site, it remembers your name and shows you offer on what you have searched for earlier. There are literally hundreds of such things that are possible. At Simplotel, we are continuing to build such technology that offers a completely personalised experience to hotel guests when they come to the hotel website.” Simplotel Technologies is a Bengaluru based software company providing customised technology services to the hospitality industry.
The industry experts feel, once the void of hotel technology supply and demand is bridged, the Indian hospitality industry, has a bright future to make guest experiences seamless and hassle-free.
Sanghi elucidates, “The future of Indian hospitality is Cloud and the market is forthcoming and so is the industry. There is going to be a lot of action with newer technologies constantly teasing the hospitality landscape.”
Ladha believes that the future of the hospitality industry will be technologically dominated and would witness the advent of more innovative business practices, with the integration of inventive technologies that will help the industry bloom in leaps and bounds. “It will include more automated business practices and will have facilities like Blockchain, AI, Natural Language Processing and many more,” he notes.
Mohanty feels that the technology providers in India are now major players in the global hospitality landscape and the future of technology in the hospitality industry is very bright.
“India being a large emerging market with a vast population of tech savvy users, hoteliers would witness a steady growing influx of online customers. Thus, there is an ever growing need to keep investing in technology applications to engage with the traveller at all possible touchpoints of the journey,” concludes Jeddo.