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Hoteliers To Raise Tech, Service Offerings To Remain Competitive This Year

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U.S. hoteliers are boosting technology investment and customer-service offerings this year to stand out from competitors, namely Airbnb.

Hotel room, hotel industry

The industry is expected to face headwinds this year as RevPAR's growth continues to decelerate (dropping to 3.3% last year, according to STR), and oncoming supply coupled with continued Airbnb expansion makes for an increasingly competitive environment. Colliers International's Bryan Younge, Hospitality & Leisure and Valuation Advisory Services practice leader, said hoteliers giving their properties a facelift in an effort to stay up-to-date with their brand’s current standards are likely to make their largest investments in technology.

“Because of the expected influx of young travelers who are tech-savvy, it is expensive,” Younge said. “But the technology has a way of paying for itself over time.”

Hoteliers are making investments to combat cybersecurity, investing in more reliable WiFi and pouring money into functional and appealing mobile apps. They are also allocating funds for more up-to-date in-room technology, such as smart TVs that provide streaming options like Netflix and Hulu in addition to an array of movie offerings and cable TV.

As for disruptors, Younge said Airbnb remains the biggest one in the industry by far. In an effort to differentiate from Airbnb hosts, the industry is highlighting service-oriented offerings that are unique to hotels.

“These PIPs (property improvement plans) are defensive about Airbnb,” Younge said. “The brand upgrade packages are designed to bring out comforts and services that Airbnb never could — so it’s everything from technology to service. I think you’re going to see a marked increase in service standards, politeness and customer service … might as well squeeze the juice out of the oranges that you have.”