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With the news cycle laser-focused on the looming threat of a COVID-19 second wave happening in nearly every territory, it is up to each and every hotel to ensure we are all fully compliant with virus safety guidelines in order to restore group booking confidence. And the only way to ensure compliance with these safety guidelines is through contactless and compliance technologies to give guests a strong guarantee of proper sanitization as well as peace of mind.

A great deal has been written over the years about the viability of moving a hotel’s property-management system (PMS) to the cloud to take advantage of the latest technologies, but hoteliers need to realize that it’s not the only viable option. All platforms have advantages, including self-hosted, private cloud and on-premise solutions that leverage the latest mobile, contact free and web-based technologies. Independent operators can still enhance the digital guest experience, support personalized and mobile check-in, deploy contact free technologies, and secure hotel/guest data even if their PMS does not reside in the cloud. It should not be a question of “Cloud or On Premise?” but rather “Does the PMS solve your business objectives in both technology and service?”

Much has been written in the mainstream hospitality press about the challenges COVID-19 has presented to the industry. Hotels are in more pain than at any time in our memories. Because of the extensive media coverage, I won’t dwell on this topic further in what is primarily a technology column. But it’s the background for this week’s column, and so merits acknowledgement.

Are You All In?
Posted: 07/27/2020

Imagine everyone in your organization engaged, aligned, and performing to their potential. Imagine everyone playing “All In.”

Great organizations have synergy. Their culture allows them to play to a rhythm at a different tempo than the average organization. How do you get that at your organization?

Many front-line hospitality workers rely on tips for a significant part of their paychecks. If not for tips, many hotel associates who serve as waitstaff, bartenders, housekeepers, bell staff, concierges and pool attendants would soon be looking for other jobs. This is a regional issue: in most of Asia and Europe, staff get higher base pay, and tips are either not expected at all, or are truly discretionary. But in the U.S., Canada, Britain and other countries, tips are an important reality, and one that’s not likely to change anytime soon.



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The Power of the Negative Review

12/18/2013
by Kelly McGuire

The hotel marketplace is rapidly evolving from price transparency, where the advent of the OTAs suddenly allowed consumers to easily compare all room rates in a market, to value transparency, where, along with price, consumers have ready access to user experiences with hotel stays in the form of reviews, ratings, rankings and images.  As this transition unfolds, nearly every hotel revenue manager I’ve spoken with in the last couple of years (and there have been many) has (smartly) asked some version of the same question: How should all of this user generated content impact pricing decisions for my hotel? 

My research partner, Breffni Noone, Associate Professor at The Pennsylvania State University and I set out to answer this question for the industry.  We have done several studies (and have more planned) to explore consumer buying behavior in this new social world.  For our first study, we developed a scenario similar to buying a hotel room online, in which we showed a hotel example with different combinations of price (low or high), review valence (positive or negative) and aggregate rating (low or high).  We tested how the different levels of these attributes, in combination, influenced our participants’ quality and value perceptions.  Our second study built on the first by getting at the way that how consumers make tradeoffs between different attributes.  We designed a choice experiment to test how much influence these attributes have on consumers’ likelihood to purchase a particular hotel.  We varied price, review valence (positive or negative), the content and language used in the review, known vs. unknown brand, TripAdvisor rank, and aggregate ratings in a set of three hotels, and asked people to choose the one they would book. 

We will present the results from both studies in detail in an upcoming issue of Hospitality Upgrade, along with more information on how we designed and executed the two studies.  As a teaser, I’ll preview some key findings here.  The two studies clearly demonstrated that reviews are king in consumers’ decision making process, followed by price.  While consumers do pay attention to ratings, TA ranking and brand, they use the valence of the review (positive or negative) as an indication of the quality and value of their purchase, and as a primary driver of choice.  This means that negative review will remove a hotel from the consumers’ choice set, regardless of the price. 

Many hoteliers want to know whether they can charge a premium for a property with good reviews.  Our study clearly demonstrated that consumers always preferred to pay the lowest price, all things being equal.  Consumers would choose a higher priced option with better reviews than the competition, but from the choice patterns, it seemed that this was more the result of NOT picking the poorly reviewed hotel because of the negative reviews, than a decision to pay more because of the positive reviews.  So, if you are definitely better than the competition, you have some additional pricing power, but if not, consumers will look at price also.  The best advice I can give to managers is that they must pay attention not only to their own reviews, but also to their review position relative to the competition, before making any strategic pricing decisions. 
  

About The Author
Kelly McGuire

SAS
Hospitality And Travel Global Practice


Kelly McGuire leads the Hospitality and Travel Global Practice for SAS.  In this role, she is responsible for driving the offering set and setting strategic direction for the practice. McGuire works with product management, sales, alliances and R&D to ensure that SAS solutions meet the needs of the market, and evangelizes the value of advanced analytics to the industries she serves.  She has a PhD in Revenue Management from The Cornell School of Hotel Administration.

 
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