Industry

Three Ways Technology will Help Hotels, Restaurants and Travel Adapt

Learn how security, AI process automation and robots are redefining the future of Hospitality.
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Register for the Future of Industries: Hospitality webinar, live on September 1st at 11 AM/EST, to discover the trends that are redefining hospitality and accelerating innovation to meet – and anticipate – guests’ ever-changing demands.

COVID-19 Halts Plans

The outlook for the hospitality and travel industry was upended prior to the closing of first quarter reports for 2020, just as COVID-19 checked-in for its flight of disruption around the world. The global travel & tourism market, which estimates from Statista had pegged to hit $712 billion in 2020, however it is now forecasted to bring in closer to $447 billion dollars – about 35% lower than it was in 2019

Hesitancy to travel persists. In the earliest days of the pandemic, consumers admitted to being hesitant to travel due to worries about getting sick themselves (65% of consumers name contracting the disease a top concern regarding travel according to IDC research). This fear lingers as guests exercise caution and restraint when it comes to traveling and dining out. Businesses continue to implement work from home policies, including Google which announced that employees would not return to offices until the summer of 2021. Thus, demand for travel and lodging remains low and restaurants are focusing on off-premises business more than ever. Add to this, continued social distancing anticipated into 2021, traveler bans or limitations, and a return to normal will be slow and uneven at best.

Pandemic Pushes the Need for Tech Investment

As with any crisis, there will be success stories of organizations that will survive and thrive based on their strategies around the new demands created by the pandemic. In many ways the future of hospitality never shifted course…the coronavirus simply accelerated the need for organizations to address the concerns and digital demands of consumers that were already simmering. Technology needs to be evaluated in the near-term for business continuity and resilience, but in the longer term as well to avoid the rollout of technologies that will prove less useful when pandemic woes and fears – hopefully – have abated.

While developing the content for The Future of Industries: Hospitality webinar, it became evident that the trajectory for innovation has shifted as COVID-responses had forced the hand of the notoriously sluggish to invest in IT hospitality industry, a point discussed in this IDC Perspective.

Digital engagement bolstered by data has been a premier strategic objective for hospitality organizations for the last several years. It’s a fact I charted during my time as editor-in-chief for Hospitality Technology magazine, analyzing input from IT leaders in the annual Lodging and Restaurant Technology Studies respectively. In the new COVID normal, digital first demands have heightened and conversations shifted from “it’s not worth the time and investment and guests don’t want it” to “guests may want it, we need to figure out the operations and investment.” (I’m looking at you, mobile key.)

Mission: Critical = Security Skills on the Workforce

Security has always been a top challenge and priority for hospitality organizations. When crisis strikes any industry, it is often accompanied by an uptick in nefarious activity. Hospitality has notoriously been a target for hackers, but smaller organizations rarely have a dedicated security staff or CISO.

As COVID-19 forced business almost exclusively to be conducted through online channels – both guests and employees – the ramifications of non-compliant systems and rushed-through implementations became evident.

Hospitality and travel organizations across the board are reprioritizing skills that will be highly valued and sought-after for technology hires and security reigned as the top selection in IDC’s Impact on IT Spending Survey. Innovation and speed will only increase in importance, but organizations recognize the damage breaches can have on a brand’s reputation and after the economic devastation of COVID-19, the ramifications of a security breach will be intolerable to economic solvency.

A Depressed Workforce Presents Opportunity for Process Automation

Estimates for the loss of jobs in the global travel and tourism market are not encouraging, with the World Travel & Tourism Council predicting a loss of more than 197 million jobs worldwide in 2020. In the U.S., the June job report from the Department of Labor reveals that employment in leisure and hospitality increased by 2.1 million and over the month, employment in food services and drinking places rose by 1.5 million, following a gain of the same magnitude in May. While restaurants were able to begin bringing some employees back as dining restrictions, unemployment was still high – down 3.1 million since February in the U.S. – and many former employees opt not to return out of fears of being on the front lines of the crisis.

As hotels, travel and restaurant companies struggle to staff back up, there will be great opportunities for systems and processes to be automated. As AI-powered solutions improve, robotic process automation will become increasingly viable as organizations will need support for basic business functions. RPA is particularly successful with repetitive tasks where the robotic eye can much more easily scan documents and uncover errors. Wyndham Hotels and Darden Restaurants are two examples of organizations finding ROI in RPA initiatives prior to the COVID-19 outbreak.

Robots Report for Duty

Continuing the automation discussion, robotics will continue to rise in prevalence and reality as organizations move from business continuity into business resiliency. According to IDC’s COVID-19 Impact Spending Survey, 30% of hospitality and travel organizations plan to increase budgeted IT spend on robotics.

In animation, consider the robotic examples we have: the sassy and ever-attentive Rosie from the The Jetsons, attuned to her family’s needs; the environmentally conscious and industrious even in conditions that humans cannot tolerate Wall-E (who also gets extra points for loving a good musical theater medley). In real life, we have Flippy, the industrious burger- and fry basket-flipping robot who performs in the more unsavory-to-many-humans conditions over high-temperature fryers. Flippy will join the “staff” at White Castle in the fall. Hotels have their own “Rosies” – consider Hilton’s robot concierge, Connie powered by IBM’s Watson, that offers greetings and recommendations to guests upon arrival, or robotic butlers like Savioke’s Relay that can deliver items to guestrooms and has been deployed in hotels including the Residence Inn at LAX which reports higher guest satisfaction due to the rollout of its robot “Wally” and “Winnie” at a sister property.

While the aforementioned will help with myriad COVID-related issues from lack of staff to offering a human-free service option for guests, robot cleaners may be looking for a raise in the next normal. Housekeeping bots were earning their keep at hotels like RLHC which had rolled out a robot maid from Peanut Robotics. CIO John Edwards describes that the robot is meant to supplement the work of humans as “no one aspires to clean toilets” and allows humans to focus on other high-value tasks.

The COVID frenzy for cleaning has ushered in more opportunities for robots to eradicate germs with UV-light emitting robots that are operated by hotel staff. The Westin Houston Medical Center was the first U.S. hotel to utilize germ-zapping robots from LightStrike, which had been used in hospitals and showed to reduce infection rates by 50-100%. Hyper-cleaning and sanitation concerns will usher in more use cases for cobotics – robotics that rely on the collaboration between humans and machines.

Future Changes in The Hospitality Industry

To learn more about the transformative trends and technologies in restaurants, hotels and travel that are improving operations, increasing profitability and enhancing the guest experience, join us for the The Future of Industries: Hospitality webinar, on September 1, 2020 at 11 AM/EST. with Dorothy Creamer, IDC’s senior research analyst, hospitality & travel digital transformation strategies.

Dorothy Creamer

Senior Research Analyst, Hospitality and Travel Digital Transformation Strategies