With the holiday season fast approaching, let us analyse how the Hospitality business is being transformed by Cloud.
The hospitality industry has undergone a transformation in the last decade, mostly due to data explosion, social media boom as well as changing customer expectations and behaviour. The hospitality industry has adopted technology to respond to these changing times. Although the hospitality industry is not known to be quick in adopting new technology, many hotels have already started seeing positive results from moving their infrastructure to the cloud. Cloud computing enables hotels and restaurants to be more agile, flexible and connected, thus allowing real-time decision making.
Working together with other cloud-based next-generation technologies, Cloud technology is helping hoteliers gain a deeper understanding of their operations and their customers, across locations. Transitioning to a cloud-based hotel software solution can seem like an intimidating mission at the beginning. However, to meet customer expectations, hoteliers are looking for integrated technology options. These are just some of the benefits that cloud technology can provide. Cloud-based hotel software will change the hospitality industry with revolutionary features that can provide updated data in real time.
Cloud-powered Property Management System
One of the most significant cloud technology platforms that is being adopted by the industry is the Property Management System (PMS) – a software which enables the automation of all front desk activities and acts as the ‘back bone’ of the hotel. It interfaces with a variety of other key systems from channel management and bookings to hardware such as telephony and key rooms. The market for PMS is more developed in the mature countries of western Europe and the US. It is estimated that the current penetration across hotels is as high as 80-85% in the US and UK. Overall penetration is somewhat lower in the more fragmented hotel markets of Italy and Germany which have a high number of small independent hotels.
Positive underlying market drivers for cloud-based PMS:
• Strong demand growth with hotel software spend forecast to grow at 7-8% over the next three years globally
• Hotels are being run by a younger generation of owners/managers who are driving new technology adoption
• Benefits of PMS include easier updates, more flexible remote access and a simpler pricing model
• New generation of innovative technology players emerging with mobile optimized solutions
Impact of Cloud technology on the Hospitality Industry
The Hospitality Industry, like any other service industry, can gain the ability to monitor, test, and implement better solutions to improve guest experience, streamline operations, and provide better data security by migrating their applications to the cloud. It also eliminates the need for manual data sharing and processing, therefore reducing the human-error factor. Cloud technology also helps to accelerate some of the processes such as faster check-ins/check-outs, which results in a better customer experience.
Here is a look at some of the ways that cloud-based technology is changing the way hoteliers run their hotels.
Scalability due to seasonality
Most cloud providers operate on a Pay-as-you-use model. This means that cloud services can be obtained in timely manner when the need arises. In other times, cloud resources can be shut down, when not in use. Specifically, for hotels this means that they can increase computing resources during busy seasonal periods to ensure that the applications can handle the increased load. In dull periods, the infrastructure can be scaled down to reduce IT overheads.
Connectivity and Accessibility
Cloud services allow for information to be readily available in a user-friendly set up, with access from multiple devices. This allows employees to gain access to relevant and essential data from anywhere, at any time. This means that hotel employees can use a cloud-based system to access various hotel back-office systems, walking the hotel grounds with a tablet, or while sitting at a conference, miles away on their smartphone.
Another advantage of using a cloud-based hotel management system is that it can be easily connected to other software applications, even if these applications don’t share the same provider. This allows hoteliers to add new features to their existing systems without incurring much cost or disruption.
Transforming Guest experience
Today’s modern traveller expects more from his hotel experience than just a stay. They expect an integrated and highly personalized experience from their hotels. The more convenient the hotel systems, the more satisfied the guest will be. By connecting multiple application systems, the cloud can offer an improved customer experience while maintaining order, thus increasing speed of service and ultimately, customer happiness.
Slashing IT costs
Hospitality industry is a competitive space with hotels looking to offer promotions to attract guests. On-site hotel management software, managed by an IT team, means incurring considerable maintenance and running costs upfront, which can further eat away into their profits. Flexible pricing offered by cloud providers help to slash the IT costs substantially. Running the business on cloud means having no hardware costs, making it possible for even small-scale hotels to run an advanced management system. Furthermore, general operational and maintenance costs are reduced and updates or bug fixes are covered by the cloud vendor.
Popular categories of Cloud-based apps for the Hospitality industry:
- Customer Management
- Reservation Management
- Point of Sale
- Appointment booking
- Event Management
- Marketing tools
Managing any sort of transformation may seem overwhelming. However, moving to the cloud can have positive impacts that resonate not only throughout your operational departments, but across your entire hotel chain. It is important to partner with the right cloud solution provider in pursuing your company’s most important objectives. All in all, the hospitality industry cannot afford to not take advantage of all the benefits offered by cloud technology.