Hotels vs Airbnb: How Relevant Data Can Help Hotels Combat New Entrants

2nd Aug 2017

Companies that move fast and break things are popping in places where they are least welcome or expected. It just indicates that every industry, no matter how traditional, is subject to disruption. The hospitality industry was disrupted by an upstart startup called AirBnB. Technically illegal in many jurisdictions at the time of its founding, it changed the hotel industry forever.

Hotel_vs_Airbnb

It has been in operation for slightly less than a decade now, but many hoteliers would regard the idea of a networked, decentralized hospitality model as one of their biggest strategic threats.

The picture is not one of unending doom and gloom, however. Technologies that are enabling new competitors to break into the market can also be applied by hotels in order to improve their value offering, better retain customers and bolster their bottom line.

Reexamining the Market and the Value Offerings of Hotels

Part of the consumer appeal of Airbnb’s individual service providers is their unique character and capabilities. By the nature of their business, any hotel boasting several hundred rooms tries to be all things to all people, serving the broadest possible market adequately instead of becoming the preferred supplier to a smaller segment of customers.

Airbnb users, though, are able to search for the venue that offers the greatest value in terms of what matters to them most. This may mean being located a block away from a university, or situated close to a street serving specialized food. Whichever it is, these often intangible aspects of customer value have to be identified and implemented by larger, more structured hotels. In other words, hotels need to personalize the stay of their guests and provide them the experience they are looking for.

Data Collection: How Hotels Can Have an Edge Over Airbnb

As with many digital business models, the real advantage of Airbnb is the data it collects about its customers to improve their service and search. However, what is not universally recognized is how limited this information is: plenty of data is available from times before and after a guest’s stay, but relatively little that reflects on the time they are actually on a trip.

Airbnb collects ‘pre-stay’ data about where a guest is likely to stay, what kind of accommodation he or she prefers, is he travelling alone or in a group. All this information helps them fine tune their search feature and yield higher quality listings. And once the trip is complete, Airbnb collects ‘post-stay’ data in the form of reviews, where guests can leave feedback about the host, the property, and the experience they had.

By collecting ‘pre-stay’ and ‘post-stay’ data, Airbnb tries to win the guests over at the discovery and booking phase. But guest experience goes beyond booking. In fact, the quality of service during ‘the stay’ phase of the customer journey is what makes guests leave raving reviews. But since Airbnb collects no data during the ‘stay’ phase of the guest journey, there is no way for them to know how their guests move through the property and interact with it. This lacuna can be filled by hotels by making use of their guest WiFi.

Airbnb is meant as a convenience factor, but it cannot personalize the ‘at stay’ experience. As soon as someone checks into their airbnb, the host does not involve themselves with the guest at all, which is where hotels have an edge. It’s the ‘service’ of the hotels that can differentiate them from airbnb. And this service can be personalized with the help of data collected on the customers.

For example – the intelligence built in your Wifi can help you track and understand guest behavior. You can track the areas they most frequent, the food they prefer, the times they are most likely to use the swimming pool or the gym, how many times they order room service or use the hotel spa. By collecting customer’s ‘at stay’ data’, hotels can dramatically enhance the guest experience and outcompete Airbnb. A location insights and engagement platform can help hoteliers have a data driven understanding of the entire guest journey – from booking to checkout and beyond.

Maximizing Personalization

Big data is not necessarily appropriately applied to every business, but relevant data is always useful. Regular guests, especially corporate accounts, are the lifeblood of most hotels. Understanding what individual customers want is closely related to providing them with the best possible experience.

Many hoteliers are not yet applying all of the technological tools available to them to maximum effect. Location based services and integrated IT platforms certainly could be applied better in much of the hospitality industry, including in the sense of offering each customer exactly what they want, even before they make their wishes explicit.

A WiFi analytics and engagement platform can introduce a level of personalization that is matchless. If a guest is seen outside the spa, the hotel management can use the platform to send him a discount coupon for spa and salon services. Or if a certain guest is travelling with kids, the concierge can suggest a list of amusement parks in the city. This level of personalization and instant gratification is the surest sign of a great customer experience.

By providing an exceptional service, you are maximizing your chance of earning a loyal guest. And each time a guest returns to your hotel, your Wifi analytics platform collects more data on the guest and gives you an opportunity to personalize his experience even more. Everybody appreciates the little efforts some hotels make, from knowing whether a particular guest prefers the scent of lavender to cocoa, to knowing his favorite restaurants and theaters in the city.