CONTENTS

What is data management?

Email: solutions@altexsoft.com Phone: +1 (877) 777-9097 Request for Proposal
Hotel data collection: what to
look for
Share: Booking and property data
Company Housekeeping data

Travel Technology Practice Room rate data

Guest data
Digital Transformation
Procurement data
Engineering Services Public reputation data

UX/UI Consulting Hotel data storing: consider

warehouses
Data Science Сonsulting Hotel data analysis: getting
value from variables
Technology Consulting
How to make sense of data
Business Verticals Comment: chaos
Case Studies
Contacts 1

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22 Nov, 2019
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Solutions and Practices to

Turn Information into a
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The hotel business produces a plethora of data literally every moment. When a tourist
books an accommodation online, that’s new data. When a front o ce manager checks
in a guest, that’s new data. When a housekeeper marks a room as clean, that’s new
data. When something happens (you name it), it’s new data.

Valuable facts and gures appear non-stop, but how do you take advantage of them? If
not properly administered, most information is lost or unused, generating no pro t. In
this article, we’ll talk about proven data management approaches and technologies
utilized in the hospitality industry to boost revenue and enhance customer experience.

What is data management?

Data management is the policy and practice of treating data as a valuable resource.
Its goal is turning information into meaningful insights that enable expense and
operation optimization, cost cutting with a resulting increase in pro ts.

In the hospitality industry, harnessing the power of data helps decision-makers to solve
the challenging domain-speci c tasks including:

·  improving occupancy forecasting,

·  setting competitive room prices,

·  choosing the most pro table distribution channels,

·  optimizing procurement operations,

·  increasing guest loyalty, and

·  identifying and targeting the most pro table guests.

Let’s take a closer look at major data management processes — data collecting,
storing, and analyzing — as applied to the hotel domain.

Hotel data collection: what to look

for
A key challenge of hotel data management is the high diversity of available information.
It can be extracted from multiple websites, metasearch platforms, social media,
internal documents, reports and systems. There are several pillar data sets you have to
consider in the rst place.

Important hotel data sets and overlaps between them.

Booking and property data

The main storage of hotel booking information is your property management system
(PMS). While di erent PMS solutions may have slightly di erent functionality, their
primary role is to work as a single source of truth for the following data points:

·  Basic guest information — name, age, country of residence;

·  Distribution channel — which distribution channel (your website, OTA, GDS,

metasearch platform) was used to make a reservation;

·  Lead time — how much in advance a room was booked;

·  Length of stay (LOS) — the duration of a guest’s stay at your hotel;

·  Room price — how much a stay costs per night;

·  Room history — who occupies a particular room and when; and

·  Key performance metrics (KPIs) — such as Average Daily Rate (average price per
room), occupancy rate (the percentage of available rooms), Revenue per Available
Room (RevPAR).

It used to be that the only way data got into the PMS was by a front-desk manager
manually inputting it. But now, the system also accepts bookings from various online
distribution channels, including:

·  the hotel website,

·  the hotel chain’s central reservation system (CRS),

·  online travel agencies (OTAs),

·  online booking platforms,

·  global distribution systems (GDSs), and

·  metasearch engines.

The PMS communicates with external booking sites and systems via a channel
manager, that enables two-way data ow and syncs reservation updates across all
connected systems.

To provide seamless data sharing, it is recommended to integrate the PMS with other
vital modules of hotel software — such as a revenue management system (RMS),
customer relationship management system (CRM), housekeeping software, and point
of sale (POS) software that handles all hotel sales operations.

Enterprise PMS systems often come stock with the above-mentioned modules already
embedded or with an option to easily add new components from the same provider
later. If you have software solutions from di erent providers, you can make them
communicate through application programming interfaces (APIs). However, API
integrations of third-party applications don’t happen automatically, so you will probably
need help from IT specialists to teach pieces of software to “talk” to each other.

Housekeeping data
Cleanliness is one of the top factors for travelers when selecting a hotel to stay. At the
same time, a recent study encompassing 15 major hotel brands shows that just
investing more in cleaning e orts isn’t enough to guarantee higher scores from your
guests. Instead of increasing expenditures, the researchers recommend that hoteliers
pay attention to the e ciency of daily housekeeping operations.

Your data can become your best adviser on optimization. To identify gaps and discover
opportunities for cost-reduction and quality improvements, you should track, collect,
and analyze the following variables:

·  the number of sta working;

·  stay-over vs checkout cleaning times;

·  performance indicators (number of rooms per chambermaid; quality of cleaning);

·  linen per available room;

·  cost of amenities, cleaning supplies, and chemicals per room cleaned;

·  laundry expense;

·  information on repairs;

·  guest requests and complaints; and

·  guest scores for cleanliness.

Recording and systemizing all this data may seem like a painstaking task for hotels that
still use paper schedules and walkie-talkies for communication. Luckily, modern
housekeeping management software already allows for using smartphones to
report on room readiness or ll in quality checklists.

A housemaid working at the Philadelphia Marriott Downtown no longer calls a front-

desk manager to let him know that her job is done. She just presses a button on her
mobile phone. After the implementation of the app called “Rex” by tech provider
Amadeus Hospitality, the company enjoys better performance and checks their guests
into rooms faster.

As a rule, housekeeping management systems include a mobile application for sta

synced with a manager dashboard, optimized for mobile devices. Housemaids see
their schedules, tasks, and lists of assigned rooms right from their smartphones. Once
a maid marks a room as clean, its status is instantly changed on the manager
dashboard. Additionally, the housekeeping suite tracks time taken to perform each
task, o ers optimal routes from one hotel unit to another, makes daily reports, and
more.

A housekeeping panel with room status indication. Source: INNSight.com

With such technologies managers get more control over sta performance and task
completion. And no less important, they can collect data on their sta , guests, and
cleaning patterns, adjusting the work ow if necessary.

Room rate data

To set a pricing strategy, you must have data about your competitors’ room rates. It
takes hours to search for information from di erent hotels manually and then write it
down or enter it in Excel for comparison. For reasons of e ciency, more and more
hoteliers are implementing rate shopping software — a technology that pulls price
data from hotel websites and booking platforms, allowing you to compare numerous
rivals at once.

For example, Marriott International, the third largest hotel chain in the world and the
number one hotel company by sales revenue, uses a real-time rate shopping tool
called Rate 360. The smart solution works with over 600 sources through direct API
connections collecting more than 10 billion rates per month.

Pricing data from numerous hotels collected by Rate360. Source: TravelClick.

Guest data
Before, during and after their stay, hotel guests leave tons of valuable data, which is
distributed across di erent systems and touchpoints including your website, PMS,
points of sale, loyalty program pro les, check-in forms, and more. Even WiFi access
points generate useful information, telling us how customers are moving inside the
hotel, where they are spending most of their time, and which facilities they are using
most frequently. Yet, to get clear pictures of your guests and better understand their
requirements, you need to pick up all these fragments together.

The importance of collecting and structuring guest data is re ected in a recent survey
among hotel chains across the world. It shows that by 2022 Customer Relationship
Management (CRM) will become the number one investment priority for hoteliers.

Advanced CRM platforms allow for creating rich guest pro les and obtaining a true
“portrait” of each customer. The list of valuable attributes recorded in a pro le may
include:

·  contact information — phone number, physical and e-mail address;

·  demographics — age, marital status, number of children;

·  reservation data, booking channel preferences, and past booking history (taken from
the PMS);

·  reasons for stay;

·  auxiliary services used;

·  food and beverage (F&B) preferences;

·  cleaning notes and housekeeping preferences;

·  revenue details;

·  payment methods; and

·  loyalty level (feedback).

An example of a CRM guest pro le. Source: Cendyn

Alongside collecting and organizing customer information, high-end CRM solutions

o er a high level of automation. If, say, a repeated client makes a reservation by phone,
the system will recognize the number and immediately provide a manager with a
corresponding pro le.

Of course, the potential of well-structured guest data goes far beyond this and we’ll talk
about the opportunities it o ers in one of the next sections devoted to analyzing data.

Procurement data
Procurement is an important segment that impacts the hotel business success. Its
major challenge is nding the products and services of the highest quality and
negotiating the lowest possible price. Apart from purchasing expenses, there are many
other gures to be considered: transportation and freight costs, insurance, customs
duty, and the like.

In hospitality, procurement tasks become still more complicated due to the diversity of
products purchased. The major categories encompassed by hotel procurement
managers are:

·  food & beverage;

·  furniture, xtures & equipment (FF&E);

·  disposables;

·  linen and towels;

·  services;

·  uniforms; and

·  printing.

To streamline and simplify procurement operations, modern hotels tend to use e-

Procurement systems that collect, store, analyze, and update purchasing data in real
time. An early technology adopter is the Hilton Hotel corporation that has been utilizing
an e-Procurement platform by BirchStreet for over 15 years.

Designed to manage hospitality and food and beverage spends, the cloud-based
system adopted by the hotel giant o ers real-time tracking of purchase transactions,
uncovers the slightest discrepancies between purchase orders and invoices,
automatically generates standard documents, and provides budget analysis. Hilton
reports that the technology improves visibility of procurement operations and
increases performance that, in turn, drives savings. Thanks to paperwork reduction, it
takes no more than a day to process one grocery order — instead of three days as in
the past.

An e-Procurement grid to manage a hotel restaurant supplies. Source: BirchStreet

Public reputation data

Recent statistics show that 93 percent of travelers read online reviews when looking for
a hotel to stay in. So, tracking and collecting guest feedback left on booking platforms,
OTA websites, social media, and other external sources is vital for your business
success. This type of data lets you:

·  better understand pain points and guest needs,

·  recognize opportunities for improvements,

·  minimize damage caused by negative reviews, and

·  eliminate future complaints.

Monitoring and collecting reviews is a time-consuming, tedious task if performed

manually. It would be better to utilize reputation management and social listening
tools that crawl the internet to nd mentions of your hotel.

Reputation management system dashboards allow you to track, analyze and respond to
reviews and rankings online. Source: DJUBO

Reputation management systems use natural language processing and machine

learning to read, lter and classify reviews spotted on Google, TripAdvisor, Expedia,
Booking.com as well as on your own website. They allow you to identify what your
customers like and dislike about your hotel. You can also immediately respond to
negative comments and let your guests know that you care about them. Some
solutions are equipped with analytical features to show how your online reputation
changes in the course of time.

Major hotel data sources overview

Hotel data storing: consider

warehouses
Once you know where to nd valuable data, the next question that arises is how to
preserve it and prepare for further processing and business analysis. You have to
collect pieces of information scattered across numerous systems and move them to
some kind of a uni ed repository.

Data science experts at AltexSoft suggest using an enterprise data warehouse that
stores large volumes of hotel data in a manageable form. On the way from source
systems to the central “library,” the information undergoes a multistep ETL (Extract,
Transform, and Load) process. ETL tools are designed to:

·  retrieve all the required data,

·  clean and sort it,

·  eliminate anomalies and duplications,

·  convert data to a standardized and convenient format, and

·  only then pipe data to the targeted warehouse.

Data processing in a nutshell and ETL steps outline

Assuming that your hospitality business doesn’t necessarily have a team of IT people,
you will need a third-party team of data engineers to build a customized solution to
suit  your speci c needs.

But even perfectly cleansed and standardized, data is useless if it just stays in the
warehouse. To make it work you must to apply analytics and data visualization
practices that will help you understand trends and make better decisions.

Hotel data analysis: getting value

from variables
Though many hotel systems have built-in analytics tools, their capabilities may be
restricted to solving narrow tasks in a particular niche. As a rule, software like the PMS
provides you with basic business KPIs but doesn’t explain trends and their causes. If
you see that the occupancy rate is lower than expected, you often can’t respond
adequately without additional insights.

To dive deeper into available information and turn it into e ective decisions, you need
tailored business intelligence (BI) solutions that work with di erent data sources and
present results in a convenient visual form. Let’s see how hotels can get a boost from
modern BI-fueled software.

Better demand forecasting and price optimization

Demand forecasting and price optimization are the main tasks of revenue
management (RM) that aims at maximizing pro tability for hotels. Often the concept
of RM is described as “selling rooms via the right distribution channels to the right
clients at the right time and for the right price.”

The biggest key to solving this equation with numerous unknowns is the right
technology. It should take into account multiple factors (from weather to upcoming
events) impacting booking decisions and support real-time or dynamic pricing — a set
of practices for aligning room rates with shifts in demand.

Red Roof Inn use case: capitalizing on the bad weather

The US economy hotel chain used analytical tools to predict that 3 percent of ight
cancelations will lead to nearly 90,000 passengers stranded in airports near their
hotels every day. Next, revenue managers reached publicly available weather reports
and datasets on ight cancellations to forecast when and where delays and
cancellations would likely hit the 3 percent limit.

Then, knowing that most passengers would use mobile phones to search for nearby
lodging options the company launched a marketing campaign aimed at mobile device
users in the geographical areas a ected by the bad weather. This resulted in a 10
percent increase in revenue in regions where the strategy was employed.

Estimating channel profitability

To learn the demand level for each of your distribution channels, you can just look
through your PMS reports. However, for understanding a channel’s true value, you
need to consider far more facts and gures such as:

·  commissions and advertising costs;

·  average income per day, month, and year;

·  cancellation rate; and

·  days of the week when the channel in question attracts most bookings.

After feeding this data to business intelligence, you can identify OTAs or booking
engines that attract most deluxe room reservations, design optimal channel mix and
turn down sources that don’t generate pro ts.

Improving customer experience

A recent survey by the Global Business Travel Association (GBTA) shows that only one
in ve hospitality companies have implemented customer satisfaction programs. It’s no
wonder as the guest- rst approach requires extra investments, including spendings on
new technologies. Yet, saving money now risks losing demanding clients to competitors
in the near future.

The core of a pro table client-centric strategy is guest data, captured by hotel software
and external sources. Business intelligence can turn fragmented information into
recommendations on what should be improved to keep guests happy and how to
enhance the customer experience at every step of their hotel journey, from the
booking phase to checkout.

Denihan Hospitality use case: ghting noise in New York

An owner of luxury and boutique hotels across the US applied an IBM analytics tool to
extract insightful information from internal customer data and comments found on
rating websites like TripAdvisor.

The ndings allowed company executives to better understand customer preferences

and needs. Among other things, they revealed that outside noise was the number one
complaint across the brand’s 11 hotels in New York. The company responded to the
challenge with the “Put NYC on Mute” initiative, providing all guestrooms with free
earplugs. Overall, investment in the data-driven customer satisfaction strategy gave a
30-fold return.

Identifying the total guest value

From a revenue manager’s point of view, not all guests are equal. Some visitors limit
themselves to using hotel rooms only, not ordering additional services, while others
splurge on dining, tness activities, spa treatments, hotel casino, celebrating special
occasions, and so on.

By using BI tools, revenue managers can go beyond the standard performance metrics
such as RevPAR (revenue per available room) and spot the most pro table customers
along with their behavior patterns and preferences. This information is essential for
targeting high-rolling clients with tailored, personalized o ers and turning them into
repeat guests.

Optimizing housekeeping expenses

As mentioned before, cleanliness is the primary factor a ecting booking decisions.
Meanwhile, when hotels spend more on keeping rooms clean, guests all too often don’t
notice positive changes. Regarding these facts and the rising cost of labor, many
hospitality companies took an analytical approach to understand how they can
minimize expenses without sacri cing quality.

Business intelligence goes through huge quantities of housekeeping data to solve the
cost-e ciency equations. Every detail matters: from the time a housemaid spent
waiting for fresh towels in the laundry room to the consumption of cleaning supplies
depending on ooring type. The outputs generated by BI translate into new
performance standards and keeping everybody more e cient.

McNeill Hotel Company use case: utilizing male sta to aid housemaids

A Tennessee-based owner and developer of hotel property applied analytics to

combine metrics like the number of linen sets per one card, time spent to load and
carry it to the laundry room, and linens in rotation per day, to name a few. As a result,
manages saw room for improvement and engaged the male workforce in
housekeeping activities.

Now, housemen whose morning routine typically includes cleaning common areas and
removing trash help housemaids with stripping dirty sheets. The men also restock carts
with fresh linen. This allows women focus on cleaning tasks only, doing their job faster
and better. The strategy enables housemaids to save up to three minutes per room
while increasing cleanliness rates.

How to make sense of data chaos

Data in itself is worthless and, worse yet, can disorient or drive to wrong conclusions.
Without implementing a data management culture, hotel administrators and other
employees can be buried in heaps of diversi ed and often con icting facts and gures.
Here are some nal tips to harness your data and make it priceless.

1. Don’t collect more than necessary. Decide why you need particular data and
how it can help you reach your business goals. Don’t waste time and storage space
on information you are not going to utilize.
2. Integrate. Hotels often tend to operate isolated applications for di erent functional
areas. Ideally, all your systems and tools should be integrated with each other for
seamless data exchange.
3. Centralize. If possible, use a single dashboard connected with di erent systems.
This way, you will have a centralized view of your business and bring all departments
together.
4. Invest in training. Teach your sta to collect, unify, and organize data in the hotel
software, using di erent sources of information — both physical and digital.
5. Keep it in a data warehouse. This will ensure that the data you need is cleansed,
structured, conveniently packaged, always at hand, and ready to use by analytical
tools.
6. Analyze it. Perhaps, your PMS can calculate key hotel KPIs, based on booking data it
operates. Yet, you need more powerful analytics tools to extract valuable insights.
There are many ready-to-use BI solutions on the market. However, chances are that
none of them will perfectly t your speci c business needs. Custom BI solutions o er
more exibility and will accurately meet your requirements. But, it takes time, money
and tech skills to develop them. Anyway, consult with BI analysts rst to balance cost,
quality, and e ciency.
7. Visualize it. Your business intelligence may apply extremely complex algorithms to
endless rows and columns of data. However, the results should be presented in a
comprehensible and helpful form so your hotel managers can use it to track trends,
tweak their daily work ow, and make better decisions. At the end of the day, the data
should make everybody’s life and work easier rather than the reverse.

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Further Reading

Hotel Revenue Hotel Property How the Hospitality Industry

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