Digital transformation has cascaded across industries disjointly and haphazardly, but a common theme unites business leaders around the world: the infusion of digital is everywhere and growing increasingly. Consumer expectations will raise the bar for businesses and will ultimately drive change. One such industry is the hotel industry, predicted to be a $550 billion global industry by 2016. But in order for hotels to tap into that revenue, it is critical for management to embrace digital transformation strategically and quickly.
Mega disruptor Airbnb recently posted that over 150,000 guests stay in it's member’s properties every night, which rivals the scale of the biggest hotel chains such as the Hilton and Intercontinental. Typical of other disruptors, the Airbnb took hold in a low-end market, and continuously moved up-market by improving quality, eventually disrupting established competitors. Airbnb did a brilliant job in creating a well designed, digital platform to connect travelers and hosts. But what Airbnb did best was disrupt by breaking down traditional barriers and providing a cohesive digital experience. Hoteliers that did not provide an online customer experience lost out to disruption.
Melia Hotels International, Spain's largest hotel chain and one of the world's largest resort chains, announced the creation of Melia Digital, a subgroup to lead digital transformation across their 350 properties. Developing a new strategy around the digital consumer was the catalyst to the group formation. Key initiatives include:
Digital transformation in any industry is a never-ending process, and refinement is key for any digital initiative as technology evolves. Harvard Business School has formulated tactics for hoteliers competing with Airbnb:
Ninety-two percent of US travelers book their hotel reservations online, making investments to hotel websites immensely critical to compete. Sixty- three percent of people consult reviews before making a reservation, and sixty-five percent make same-day reservations with a smartphone. It is no longer an option to not be mobile as 81% of hotel brands now have a mobile-optimized website, up from 66% in 2012.We recommend to establish a sound digital strategy to build a customer digital platform across all touch points. Mobile-first and personalized customer relationships will attract and retain consumers and lastly, incorporating transparency and listening to customer desires will help refine the digital transformation.