The hospitality sector can leverage the power of data analytics to transform everything from customer experience to revenue management, writes Jadd Elliot Dib, Founder and CEO of Pangaea X 

 

The hospitality industry has significantly evolved in the last two decades with rapid globalisation and constantly evolving consumer preferences, backed by technological advancements. Today, we are in another phase of evolution of the hospitality industry, this time driven by data.

 

Data analytics has been used for decades in major industries to increase performance and predict patterns, but has the potential of revolutionising other industries such as hospitality. Data aggregating customer preferences and shaping operating models on it can become mainstream practice in an industry that bases its success on customer satisfaction and unique experiences.

 

A deeper look into the data and analytics sector shows that it can significantly enhance the hospitality experience.

 

Building personalised experiences

Understanding consumers is the mantra of success for the hospitality industry. Data and analytics can support the hospitality sector participants to build personalised experiences for the different type of people they cater to. For instance, a hotel operator can analyse data of trek-loving guests to provide them with a personalised offer for a trek to the nearby mountains as part of their package.

By providing personalised experiences for guests the hospitality industry can improve quality and depth of their offerings for every customer, ensuring superior customer satisfaction, thereby facilitating and higher retention rates.

 

Improving revenue management

Balancing pricing and consumer appetite requires a precision analysis of demand to maximise revenue. The hospitality sector currently uses their elaborate experience in pricing their services and maximising returns on their assets. However, with the onset of the Covid pandemic and the rapidly evolving consumer preferences along with disruptive competitors, the industry requires realtime comprehension of consumer demand and competition offerings to price their services, accordingly, maximising revenue and increasing profits.

 

Data and analytics can offer various measuring tools that can be monitored realtime by experts to set service pricing based on providing the highest value for guests and ensuring the flow of revenue.

 

Efficient marketing

It doesn’t require an expert to tell you that marketing your luxury services in a low income suburb may not reap the returns you want, but algorithms can help you identify consumer groups that you can target for different services you have. Data and analytics enables you to understand consumers better and segregate them, accordingly, helping you market your services to them efficiently and produce better returns on your investment.

 

The service industry spends up to a staggering 53% of their total revenue on marketing. Data and analytics can reduce marketing budgets by efficiently marketing services to the right audiences.

 

Prudent investment

With such data analytics, hospitality brands can invest smartly in areas that provide higher returns. They can also use data to track competitor brands and hotels, and identify new revenue streams outside of rooms, such as new facilities and services, and make sure they are satisfying both guests and people in the local community. Investing in improving services such as adding a sports café or cycling track around a hotel property is a difficult decision to make for the management without information about the revenue it can bring. Analysing data from previous customers or other properties where such assets exist can provide the management with the right knowledge to make informed decisions. 

 

Increasing competition

Understanding competition is an important metric to gauge a hospitality business’ sustainability. Without data, the management has to rely on untrustworthy information about the competition’s strategy, pricing, etc. With data analytics, firms can increase their understanding of the market and their competition to improve business performance.

 

Data analytics has the potential to revolutionise the hospitality industry to increase profitability and improve the overall sector offerings to customers. Data has the potential to uncover perspectives that support in strategic decision making and revolutionising the hospitality industry once again.  -TradeArabia News Service