hotel pool jump
2 years ago
 

Investing in hotel technology – guest needs versus franchise demands

NB: This is a guest article Timo Kettern, IT director for Westbridge Europe and hotel IT advisory board member for the Hospitality Technology EXPO (HTE).

It’s a dilemma that’s been simmering under the surface of the industry for years and one that shows no sign of abating…

How does a hotel owner follow franchisors brand standards, whilst managing potential conflict with guest needs and ensuring a good return on investment?

Hotel technology is one of the key areas in which conflict between individual owner/operators and franchisors crops up, with both sides very territorial over how much ground (and control) they yield to the other party.

So, how did we get here and what’s being done to resolve an issue that threatens to remain a sticking point between hotel owners and franchisors for years to come?

Background

Over the past ten to fifteen years more and more individual hotel owners and operators have opted to become franchisees of big name industry players, such as Hilton and IHG.

By joining a major hotel chain, these individual owners benefit from the brand association they get from being under such a well-known corporate umbrella, broader consumer recognition, plus access to well-established centralised reservation and booking systems.

By submitting to the will of the big franchisors however, decisions regarding individual hotel needs can be taken away from the individual owners, often to the detriment of the hotel.

The big franchisors maintain that owners must follow their brand standards to the letter, a situation that inevitably leads to conflict over things like in-room technology.

When it comes to investing in hotel technology, owners can be loathe to implement anything that doesn’t offer a good return on investment.

As one hotel owner said to me at a conference a few weeks back:

“Property exit value is key. No ROI while the asset is in my ownership? No technology project.”

This is a familiar sentiment for many of the individual owners linked with big hotel chains and so, with the big franchisors issuing a list of strict brand standards for hotels across their portfolio, technology is always on the front-line of the battle.

Fightclub

Around the world, it’s David versus Goliath as franchisors are being challenged as to why certain standards are in place even though, more often than not, these investments have a negligible impact on the ability of the hotelier to bring in additional revenue.

Indeed it’s hard to blame the individual owner who pushes back against his corporate parent regarding a request to install three phones in a hotel room when, quite frankly, one will do.

While such examples may seem trivial, these are just the tip of the iceberg in the debate currently raging between franchisees and franchisors.

Realising the bargaining power that these individual owners have when they speak together with one voice, some of the larger chains like Intercontinental have understood the situation and established owner association meetings in which franchisees can air grievances.

An industry forum promoting two-way communication is a step in the right direction and just one tactic among many to address what has become a difficult relationship between two mutually dependant parties.

The owners also know that the franchisor will not take away the flag on top of the hotel when he only puts one phone in the bedroom.

NB: This is a guest article Timo Kettern, IT director for Westbridge Europe and hotel IT advisory board member for the Hospitality Technology EXPO (HTE).

NB2: Hotel pool jump image via Shutterstock.

 
 
Special Nodes

About the Writer :: Special Nodes

Special Nodes is the byline under which Tnooz publishes articles by guest authors from around the industry.

 

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  1. Hhotelconsult

    Brand standards are out of touch, myopic, and very “20th Century” top down approach to hospitality. This is the fault of industrialization altering the intent of hospitality. I get why there are brand standards, but isn’t it ludicrous that we are in hospitality and having a conversation about whether to focus on guest needs vs. your franchise’s? It’s insulting. We had this issue with Hilton at a Doubletree, and the inevitable dance is “we won’t do that”, and the company saying “yes you will”, and then we don’t really respond, don’t say no again, but drag our feet for years. =)

    It’s bizarre to think a brand/flag would mindlessly top down push something onto a hotel, but here we are. And this is precisely why these flags with their brand standards are now falling out of favor, and hotels are considering becoming independent, instead of having to pay extraordinary fees for bureaucratic com[pliancy issues, coupled with a complete lack of production or help.

    With all the various forms of distribution now, from Tablet and Mr & Mrs Smith, to OTA’s that don’t extort, or are segment focused – I feel that a lot of these brands will have to become more amenable to understanding the need at property level, instead of the other way around.

    I have helped design, build, and open a number of hotels. The owners, architects, construction people all have this idea of how the hotel will “live” and behave, and then, inevitably, it takes on a life of its own, develops its own character, and it runs itself how it runs itself…. the original housekeeping room might not work right, the break room might be too small, etc. What you plan for, and what it becomes, are often two different things. To think you can just push brand standards down onto a living and breathing property that is very different from the next one in the porfolio is archaic, out of touch brand management. We’ll see a shake up in how this is done in the next couple years. Hopefully these franchises and brands figure out to turn their ship around before its too late.

    Short answer: Franchisers reading this: let your property source from local purveyors, artists, etc. I know it’s efficient to source from one place, but hospitality isn’t always about efficiency, or we wouldn’t be in hospitality, we’d be in hospitals. Let the property define itself, and let the guest experience grow out of that.

     
  2. Technology At Work

    Completely agree with Raj- this balancing act is difficult. I definitely can understand the hotel owner that said if there’s no ROI, there’s no technology project, but we should also be conscious of the added value to remain competitive in this market. A hotel that has free AND fast WiFi with complete coverage will get much better reviews than the hotel that charges for slow WiFi with spotty coverage.

     
  3. Raj Chudasama

    It’s always a balancing act with the wants of a franchisor and the expectations of a guest. As hotel owners add in-room technology, franchisors need to also identify “old technology” or amenities to remove, i.e. stationary, tent cards, cordless phones, etc. The cycle of technology needs from a guest has been accelerating and hotel owners and franchisors have struggled to keep up.

     
 
 

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