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[Countertrend Article] Digital technology working for the future of hospitality

#Bonnes Pratiques

Hugues van Heesewijk - CEO & co-funder of Gogaille

COUNTERTREND ARTICLE

This trend is founded on 2 base trends:

The first, comes with the trends for slow tourism and getting off the beaten track. Historically, hospitality customers often followed “circuits”, which were predefined or followed in an individual manner—you did not go to Paris or Rome without visiting all the big tourist attractions.

Today, travellers are looking for a more unique local experience: a tour of small gastronomic restaurants, visiting wine cellars on a bike, tastings with fine pastry chefs, attending craft workshops or yoga lessons, and meeting local people.

When a simple map of the town is insufficient, now people need guides, coordinators, specialists, to assist tourists.

The second phenomenon is the broad range of accommodation offerings available on the market. Here, once again, in recent years we have seen a real customisation of the offering: with Airbnb offerings in town centres and villas on the sea front, we no longer just sleep in hotels or weekly rentals. Hospitality is no longer dominated by the hotel industry. Thousands of private individuals have adopted the hospitality profession. Connected professions have tagged on to this trend: home-stagers, photographers, cleaning agencies, etc. As the offering has grown, we have seen the range of services offered upgraded with a real move towards becoming more professional.

Therefore, with the noticeable upgrading of the services, it is the human aspect that, little by little, is making a difference to the experience.

Changing business models

It is a little known fact that the payroll accounts for about 30% of the fixed costs in a hotel sector business plan. The remainder is mostly made up of operational costs, financing expenses and the costs of real estate (rent or paying off property loans).

With the massive introduction of digital technology in the industry, we can see substantial savings on operational costs and in particular on the different consumables.

Data and tech tools make it possible to reduce waste, needless cleaning, leaks, wasteful or unnecessary consumption (lights, laundry, water, heating, etc.). All of these improvements in productivity lead to increased operating margin over the whole operational budget.

Many new brands are therefore choosing to invest these savings in recruiting teams, to improve the quality of their services, and to make their products and brands more appealing. It is a virtuous cycle between technology and jobs.

A diversification of the offering that is becoming the norm

A few weeks ago, the Accor Group announced that they wished to launch a SPAC (special-purpose acquisition company) to massively diversify their catering and well-being offering. A few years ago, Airbnb was a precursor by launching its offering of “experiences” that travellers could buy directly on the platform.

What all these initiatives show us is that, after being greatly shaken up, the professions of the hospitality industry are reinventing themselves and giving greater value to the intrinsic value of the profession: hosting.

Traditional hotels are transforming to be really multi-faceted hosts, abandoning the guise as simple caterers or innkeepers to offer a broad range of customised services. Tomorrow’s hospitality industry will be made up of “destination ambassadors”, who are highly specialised, offering not only accommodation or a meal but an experience of the region or the town; from its gastronomy to its architecture including its artistic heritage. This phenomenon will lead to the emergence of new jobs in the coming years, which will compensate for the loss of more traditional jobs, due to new technological developments.

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