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Perspectives

Hospitality, Digital Style

2018-02-07


Digital is taking hold all along the travel journey. Here’s a look at what hoteliers need to do to stay relevant today through 2025.

The way we travel is about to change dramatically — and the hospitality industry’s transformation of its offerings and infrastructure will be an integral part of the shift.

For our special report, “Road to 2025: Hospitality in the Digital Era,” we examine disruption at every point in the travel journey, starting with inspiration. The launch point for every journey has high stakes for hospitality providers: Every time you can inspire someone to book through your proprietary channel rather than an intermediary, that’s as much as 15% of the transaction that you get to keep. 

In a world cluttered with options and intermediaries, inspiration is an increasingly important tool for retaining market share and revenue. Backed by virtual reality and personalization, inspiration will be more fluid in 2025, finding its way to fun, in-room experiences. 

Customized experience will be the rule, not the exception. Powered by artificial intelligence (AI) and whisked off through automated processes, personalized offers will be at the heart of inspiration. 

Conversational software bots will flourish in booking and purchase. Not only will chatbots enable guests to explore options at their own pace but by 2025 they’re also likely to form a new reservation channel and ferry notifications to guests. 

It goes (almost) without saying that retaining existing customers is far more cost-effective than acquiring new ones. Hoteliers’ collaboration with travel-ribbon partners such as airlines, restaurants and retailers will be essential. 

Loyalty programs will grow similarly collaborative. Blockchain holds great potential for helping hospitality organizations manage the accrual and frictionless redemption of loyalty points. The distributed ledger technology eliminates the need for third parties and reduces transaction costs. It makes tracking points less expensive and more secure. (For more information, see our e-book, “Demystifying Blockchain.”)

Arrival continues to be a frustration point in the travel journey. By 2025, however, check-in lines are likely to be distant memories. 

Our research found travelers to be enthusiastic about using technology to make their arrival more convenient, with 54% favoring use of mobile devices to check in, and 50% interested in using them to open their hotel room door. 

Figure 1

They also show a high level of interest in greater automation of other hotel services. At least half want to use their mobile device to receive bills, checkout, and pay. (For more information, read our report, “Identifying Early Adopters for Emerging Digital Travel Services.”)

Biometrics will feature prominently in improving the on-site experience, buoyed by the technology’s growing acceptance among consumers and the burgeoning number of biometrics-enabled mobile devices.

For independent-minded travelers, staff-less hotels will offer a mix of new technologies including Internet of Things, bots, and AI. IoT, in particular, has broad application in hospitality — and in driving revenues. By 2025, hotels will increasingly leverage IoT for connecting to and upselling customers. 

Getting Your Organization Ready for 2025

Whether your organization has defined its five- and 10-year plans or is just beginning to consider how it will adapt, the following steps can help you assess your organization’s readiness:

  • Invest in getting to know your guests. Take a deeper dive into customer journey mapping. Create detailed strategies and roadmaps for unique experiences across all touchpoints.

  • Evaluate labor innovations. Assess how robotics and self-service options can lower your fixed labor costs and enhance your organization’s efficiency without detracting from the customer experience. 

  • Examine how data flows across your properties. Delivery of personalization and experience relies on readily available data from guests’ prior stays and social networking. What’s your strategy for gathering data from the various operations systems? How will you use it to support different phases of the customer lifecycle? 

  • Determine your IoT readiness. Hotels make natural applications for IoT’s ability to connect people and things. 

To learn more, read the full report “The Road to 2025: Hospitality in the Digital Era,” or visit the travel and hospitality section of our website.

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Hospitality, Digital Style