Five ways for hoteliers to measure success
Technology is an integral part of our daily lives. With new advancements regularly emerging, it's astonishing how quickly certain innovations, like AI, have come to dominate our conversations. This rapid evolution prompts crucial questions, and there’s one in particular that we’re concerned with: how do we define, track and measure success in hospitality tech? Let's delve into this topic.
Hospitality tech is changing faster than ever
Not only is there simply more technology – it's also being adopted by its users at an unprecedented speed. Back in 1997, Netflix took three and a half years to reach the milestone of a million users. In 2006, Twitter did it in two years. Instagram needed just five months in 2010, and in 2022, ChatGPT accomplished it in a mere five days.
This astounding pace shows us that as new tech integrates faster into our lives, we must adapt just as quickly. Yet, the hospitality industry reinvests an average of just 3% of revenue into technology. In such a rapidly changing landscape, this modest reinvestment signals a deeper issue.
We need to reassess how we view, evaluate and utilize technology in hospitality. Many still regard the transition from on-premises to cloud solutions as the pinnacle of tech transformation. This shift happened a decade ago in other sectors, yet it's still a talking point in hospitality. We must move beyond this outdated conversation and start viewing technology as a critical business driver and problem solver.
How we think about technology today
Where is your phone right now? In your pocket, on your desk – maybe even in your hand? When you bought this phone, did you think about how many megapixels or what type of lens it has? Probably not. What you likely did research is whether it can take great photos at night, if it can capture fast-moving objects or take wide-angle pictures.
That’s because the conversation around the technology has changed. We no longer focus on technical specifications, but rather on real-world results.
Unfortunately, this shift isn't uniform across all industries. In hospitality, the focus often remains on migrating existing processes to the cloud rather than on the transformative potential of technology. Instead, we should all demand more from technology – not just functionality but real business value. Treat technology partners as strategic allies, not mere vendors.
How to measure success in hospitality tech
In the case of phone cameras, success is evident in the quality of photos. But what defines success in hospitality tech?
There’s a broad range of thinking here, but most of it can be distilled into five key criteria: guest experience, guest lifetime value, revenue per square meter, revenue per employee, and time spent on tasks. Serious hospitality businesses (hoteliers and hotel tech providers) should regularly evaluate these areas and adapt accordingly.
1. Guest Experience
Guest experience is at the heart of our industry. Every action we take should aim to enhance it. Measure guest experience through reviews and surveys, and use technology to spot trends and adapt.
Technology can directly improve guest experiences by providing tools for guests – at Mews, one in four check-ins happen through self-serve options. Technology also frees up staff time, allowing them to focus on guests and provide more memorable encounters.
2. Guest Lifetime Value
While hotels should be most concerned with delighting guests, let’s also not lose sight of the fact that they’re businesses that need to turn a profit. Guest lifetime value reflects whether your services are compelling enough for guests to spend more and return, which is key to running a successful property.
Technology supports this by enabling loyalty programs and marketing campaigns to boost repeat visits and spending. For instance, one in ten guests purchases an upgrade or upsell via Mews before arrival, increasing the booking value (and their lifetime value) even before they check in.
3. Revenue per Available Square Meter (RevPAM)
To maximize revenue and enhance guest experiences, think beyond rooms. Revenue per available square meter (RevPAM) measures how effectively you utilize your entire property. Mews-powered properties excel by monetizing spaces like parking lots and meeting rooms (or even snowmobiles and karaoke rooms), resulting in a 6% average revenue boost.
In other words, Mews is the only true property management system because it manages the entire property, not just rooms.
4. Revenue per Employee
Employees are your most valuable resource. Without a happy, productive staff, delivering exceptional guest experiences is impossible. Mews promotes user disengagement, which aims for staff to spend less time actively using technology, freeing them to focus on guests, enhancing experiences and potentially increasing guest lifetime value.
5. Time Spent on Tasks
Recurring tasks take up a significant amount time in hotels – check-ins, check-outs, bill printing, payments... Mews focuses on minimizing these task times, allowing more time for business strategy or guest engagement. Recent improvements have cut task times by 46%, nearly halving the time hoteliers spend on these activities.
We hope these ideas help you to reflect on how you define success in hospitality tech. This article is based on a presentation at Mews Unfold 2024, which offers countless insights and inspiration about the future of hospitality. Discover more from Unfold 2024 at the Unfold Unpacked hub.
About Mews
Mews is the leading platform for the new era of hospitality. Powering over 5,000 customers across more than 85 countries, Mews Hospitality Cloud is designed to streamline operations for modern hoteliers, transform the guest experience and create more profitable businesses. Customers include Generator-Freehand, The Strawberry Group, The Social Hub, and Airelles. Mews was named Best PMS (2024) and listed among the Best Place to Work in Hotel Tech (2021, 2022, 2024) by Hotel Tech Report, as well as World's Best Hotel PMS Provider (2023) and World's Best Independent Hotel PMS Provider (2022, 2023) by World Travel Tech Awards. The company has offices in Europe, the United States and Australia.
