The CBRE Hotel’s annual CheckIn report examines the impact of technology and social media on brand image has led to large hotel chains finding new digital solutions to attract and retain customers.

Millennials and Generation Z, who now make up around 45% of the population, were found to be influential in driving industry change due to their expectations for constant connectedness; reliance on social media; preference to use smartphones for search and online purchases; faster service and self-service technology.

The report cited 85% of consumers trust online reviews as much as personal recommendations, 81% of people read reviews and check ratings before making a purchase decision, and WiFi has become an essential consideration when booking hotels, coming in second only to cost.

Click here to view and download the CBRE Hotel’s annual CheckIn report.

CBRE Hotels National Director, Wayne Bunz, said while digital technologies require significant capital expenditure, the investment is forward-facing and essential to operators wanting to maintain their relevance and mitigate the threat of distruptors.

“Hoteliers need to understand the value of digitisation and speed up their efforts, or risk becoming less relevant in the mind of this emerging ‘new’ customer. Competition for customers is only going to intensify as online companies expand into the hospitality industry,” Mr Bunz said.

“Investment in mobile apps, loyalty programs and automation can all provide a seamless front-end experience, but we are now also seeing the adoption of Artificial Intelligence, Virtual Reality and facial recognition technologies globally. Hotels of the future will look and feel very different from present-day models; futuristic and experiential based,” Mr Bunz said.

Marriott was one of the first operators to roll out mobile check-in/check-out and room ready alerts, and has since launched a mobile requests service, which enables guests to contact hotel staff and access Netflix and YouTube through their devices. Another key example is the development of an integrated social media listening platform by AccorHotels, to help it become more customer-centric at every stage of the customer journey.

However, despite the growing importance of technology and social media, CBRE Senior Research Manager Danny Lee said the hotels industry has been slow in its adoption of digital solutions compared to other industries, ranking well behind banks and financial institutions.

“When the internet came to prominence, the hotel industry was one of the earliest adopters and was quick to enable direct bookings on their websites. This was the extent to which they digitised, resulting in hotels falling behind other industries,” Mr Lee said.

“That being said, over the last five years the increased pace of digital transformation in hotels has been significant. Smartphone enabled check-ins, door entry and robotic services are all being adopted across the industry, with some operators offering full automation services to lure tech-savvy customers.”

Mr Lee added back end operations also benefit from new technologies. Robots performing housekeeping functions have the potential to generate significant cost savings in an industry that is labour intensive. The CheckIn report found fixed labour accounts for 30-40% of a hotel’s operating cost.

“Investment in automating back end operations can ultimately free up hotels to focus on providing excellent service and an engaging customer experience,” Mr Lee concluded.

Click here to view and download the CBRE Hotel’s annual CheckIn report.

To discuss the hotel market in further detail, contact Wayne Bunz via the below contact details.

See also:

Auckland New Zealand Hotel Research Report: Horwath HTL

Scarcity sees Sydney five-star hotel room values soar Michael Simpson Savills Hotels

Holiday Inn Hotel announced for Melbourne suburb of Ringwood