Building a Hospitality Business for this Decade: Own Your Data
Today’s market demands short-term rental professionals focus on profitability. This means that establishing a direct contact with guests has become essential, not just a nice to have. Hence more hospitality operators seek to build on “owned land,” favoring the benefits of direct channels over third-party sites. While there are many advantages to having visibility with online travel agencies, building a direct booking strategy is important. The foundation of the direct booking strategy for short-term rentals lies in owning and leveraging data.
For more information and actionable tips, we are breaking down the thesis, shared by Francois Gouelo at the Book Direct Show. The recent tech advancement make building a solid data strategy more crucial now than ever before. Of course we mean the artificial intelligence boom and its availability for property managers. Now is the time to collect, centralize and take action on your data. We are sharing a guide on how to do this without annoying your guests and overload your team.
Watch the recording of the “Building Your Vacation Rental Business for This Decade” workshop from The Book Direct Show.
TL;DR: Breaking down the main ideas of the workshop plus current updates.
We’ll outline actionable steps for vacation rental businesses to use data for driving return guests and direct bookings.
The Transformative Role of Data
Data as the Foundation of Innovation
In the past, businesses relied heavily on tangible assets and face-to-face interactions to drive growth. However, the rise of digital technology has changed the game entirely. Entrepreneurs now have unprecedented access to vast amounts of data, from consumer behavior and market trends to operational efficiencies and competitive intelligence. The ability to collect, analyze, and act on this data has become a critical determinant of success.
Strategic data ownership involves more than just gathering information; it requires a thoughtful approach to data management, ensuring that data is accurate, secure, and used ethically. This involves investing in robust data infrastructure, employing advanced analytics, and fostering a culture of data-driven decision-making within the organization. By doing so, businesses can unlock valuable insights that drive innovation, improve customer experiences, and optimize operations.
Furthermore, the digital age has introduced new challenges and opportunities in terms of sustainability. With consumers increasingly prioritizing ethical and environmentally responsible businesses, entrepreneurs must consider how their data strategies align with broader social and environmental goals. This might involve using data to reduce waste, enhance supply chain transparency, or develop products that meet the growing demand for sustainability.
The integration of data-driven strategies into the core of business operations also enables more agile and responsive decision-making. In a rapidly changing market, the ability to pivot quickly and make informed choices can mean the difference between success and failure. This agility is particularly crucial for startups and emerging businesses, which often operate in highly competitive environments with limited resources.
Predictive Analytics and Personalized Services in Hospitality
How do you integrate these principles into the hospitality industry? Exceptional guest experience is born out of predictive analytics, personalized services, and seamless operational efficiency—all fueled by data.
Predictive analytics is at the heart of this transformation. By analyzing past guest behavior, preferences, and feedback, hospitality businesses can anticipate needs before they arise. For instance, if a returning guest consistently books a spa service during their stay, the system can automatically offer a personalized package that includes spa treatments at a discounted rate. This level of personalization not only enhances the guest experience but also drives repeat bookings and brand loyalty.
Personalized services extend beyond just recommendations. In a data-driven hospitality model, every interaction is tailored to the individual guest. From room temperature settings adjusted to their preferences upon check-in to curated dining experiences based on past orders, the use of data allows for a level of customization that was previously unimaginable. This kind of attention to detail turns a standard stay into a memorable experience that guests are likely to rave about in reviews and social media, further enhancing the brand’s reputation.
Seamless operational efficiency is another critical component of integrating data into the hospitality industry. By leveraging data, hotels and resorts can optimize their operations to ensure that everything runs smoothly behind the scenes. This could involve using data to predict peak check-in times and adjust staffing accordingly, or analyzing maintenance logs to preemptively address issues before they affect a guest’s stay. Such efficiencies not only improve the guest experience but also reduce costs and increase profitability.
The future of business, particularly in the hospitality sector, lies in understanding, owning, and skillfully leveraging data. As we navigate through the complexities of this decade, the businesses that will thrive are those that can harness data to identify new opportunities, anticipate guest needs, and streamline operations. This data-driven approach is not just about keeping up with industry trends—it’s about leading the charge in transforming how we think about and deliver hospitality.
By embracing these principles, the hospitality industry can not only meet the evolving demands of today’s travelers but also set new standards for guest experiences. As we move forward, let’s use data to innovate, create exceptional guest experiences, and ultimately transform our industry into one that is more responsive, personalized, and efficient than ever before. The opportunities are vast, and the potential for growth and success is enormous for those who are willing to adapt and embrace this data-driven future.
Reimagining Guest Experience Through Data
The Power of Predictive Insights
Let’s reimagine the guest experience through a data-centric lens. Understanding and predicting guest needs leads to unparalleled service delivery. Immediate responses, personalized messages, tailored recommendations, one-click purchases are bridging the gap between traditional hospitality services and the digital future.
Immediate responses are a critical component of this data-driven approach. In an era where speed and efficiency are paramount, guests expect their queries to be addressed in real-time. AI-powered chatbots and automated messaging systems can provide instant answers to common questions, while more complex inquiries can be routed to human staff who are equipped with the guest’s preferences and history at their fingertips. This ensures that every interaction is both timely and relevant, enhancing guest satisfaction and streamlining operations.
Personalized messages are another way data is reshaping the guest experience. Instead of generic communication, hotels can send tailored messages that resonate with individual guests. Whether it’s a special offer on a service they’ve shown interest in, a reminder of their favorite amenities, or a warm welcome back after a previous stay, these personalized touches make guests feel valued and understood. This level of engagement fosters loyalty and encourages repeat visits, turning one-time guests into long-term patrons.
Tailored recommendations are the next frontier in hospitality, offering guests suggestions that are perfectly aligned with their tastes and preferences. By analyzing data such as past bookings, social media activity, and even real-time behavior during their stay, hotels can offer personalized experiences that range from dining recommendations to local activities. This not only enhances the guest’s stay but also opens up additional revenue streams through upselling and cross-selling opportunities.
One-click purchases are simplifying the way guests interact with services during their stay. Whether booking a spa appointment, ordering room service, or upgrading their room, guests can now make decisions and complete transactions with just a single click. This ease of use is a hallmark of the digital age and bridges the gap between traditional hospitality services and the digital future. By making it easier for guests to access and enjoy what the hotel has to offer, businesses can increase revenue while also improving the overall guest experience.
Data Ownership and Competitive Edge
By owning their data, hospitality businesses can gain a holistic understanding of their guests’ preferences, behaviors, and expectations. This deep insight allows them to craft unique experiences that resonate on a personal level, creating a sense of connection and loyalty that generic, one-size-fits-all approaches simply can’t match. For example, a hotel that knows a guest’s preferred room temperature, favorite type of pillow, or dining preferences can have these amenities ready upon arrival, making the guest feel instantly at home.
Operational efficiency is another significant benefit of data ownership. When businesses have direct access to their data, they can streamline processes, optimize resource allocation, and reduce waste. For instance, predictive analytics can help in forecasting demand, allowing for better inventory management, staffing, and even energy usage. This not only reduces costs but also ensures that guests receive the highest level of service, even during peak times.
Furthermore, data ownership fosters deeper connections between businesses and their guests by enabling more personalized and relevant communication. Rather than bombarding guests with generic promotions or updates, businesses can send targeted messages that speak directly to the interests and needs of the individual. This could be anything from a personalized discount on a spa service the guest has previously enjoyed to a curated list of local attractions that align with their past activities. Such tailored communication not only enhances the guest experience but also reinforces the guest’s perception of the brand as attentive and responsive to their needs.
The Google and Yelp Example
There was a notable period when Google, in its effort to enhance its local search offerings, integrated Yelp reviews into its Google Maps and local search results. This move allowed users to see Yelp’s crowd-sourced reviews directly within Google’s platform, providing valuable insights into businesses without having to visit Yelp’s website. However, this integration was part of a broader strategy by Google to bolster its own reviews ecosystem. Over time, as Google encouraged users to leave reviews directly on Google Maps and its other services, it began to build a substantial repository of its own user-generated content. This shift gradually decreased the reliance on Yelp’s reviews and helped Google Maps become a go-to destination for local business reviews, effectively competing with Yelp in the local search and reviews market. This development demonstrated Google’s ability to leverage external content to grow its services, subsequently capturing a significant share of the market that Yelp once dominated.
Data Dependency: Reverting the OTA game
Yelp got crushed because it had a massive data dependency. So what is this data dependency in your hospitality business? And how can you revert the OTA bookings game?
Your Business depends on potential customers – guests. OTAs (online travel agencies) depend on those same guests. But let’s not forget, OTAs also depend on you. But it’s all about the data they share with you, to be more precise – do not share with you. With the guest being at the center of this all, this is your data dependency.
How can we solve this?
You’ve been told the guest experience starts when they check-in to your rental properties. But, the guest experience starts when a guest searches. As a first step, any professional short-term rental company needs its own website.
Your Guest Experience is Your Sales Funnel
When comparing a traditional sales funnel to a one in a short-term rental business, it will look like this:
Marketing qualified leads (MQLs) are when guests search for a place to stay. Sales Qualified Leads (SQLs) – when potential guests inquire about the property. The confirmed booking is equal to a demo booked and the actual stay experience is the negotiation. The experience will define your final goal achievement – the repeat booking, equal to close lost, won or move to nurture.
OTAs have a complete control of your top of funnel and your repeat business. But with the great guest experience you can actually win on the latter. While you can’t compete with big booking platforms on the inventory size, brand equity or marketing power, you own your guest experience.
Why do popular booking sites control your repeat business? They deliver a streamlined experience. So can short-term rental owners and operators!
You can move from this:
to this:
Applying Data to Drive Direct Bookings
So how do we use data to drive more direct bookings in your short-term rental business?
Collect Data
How can you collect data from your guests? Guidebook links, verification links, check-in registration, payment links, website visitors data, Google Analytics, etc. Your property management software (PMS) and other other third-party platforms have data you can use to personalize interactions.
Here is just an example of information you can collect from guests: name, email, phone number, travel reason, preferences and restrictions, etc.
Centralize Data
How do you centralize all the information you have internally? We’ve discussed data warehousing in our recent webinar, talking about preparing an STR business for the future. Future is now and you need to have a single source of truth about your business internally.
Data warehousing is the practice of collecting data from a wide range of sources within a company into a database. It may be used to guide management decisions. In short-term rentals these resources are booking information, guest reviews, listing description, check-in steps, property guidebooks, customer support questions, etc. You can also gather details from social media, own direct booking site, listing site, channel manager, PMS, etc.
Put Data to Action – Deliver a Remarkable Guest Experience
You have all of this data, now what? There are many ways to close the loop of your guest experience.
- Personalizing your guest interactions all along the guest journey. Providing tailored suggestions according to guests preferences, interests, travel reasons, season, etc.
- Adapt your communication and guest messaging with the tools people want you to use. Instead of long emails, message your guests on WhatsApp, SMS or just send a link that proactively has all the information they need for a great stay.
- Use AI to answer quickly to any guests queries, provide AI-powered concierge services, quickly create personalized content for your audience.
Building Businesses for the Digital Age
Building a business today demands a fresh perspective on data, embracing its opportunities, and navigating its challenges with integrity. In an era where data drives decisions, the direct booking revolution is not just about adapting but thriving by harnessing the full potential of data. It involves leveraging insights to craft personalized experiences, streamline operations, and foster deeper connections with customers. By embracing advanced analytics and maintaining transparency, businesses can create meaningful, lasting impacts that not only enhance customer satisfaction but also drive sustainable growth. This revolution is a testament to the transformative power of data when used thoughtfully and strategically.
The Future of Hospitality is Personalized and Data-Informed
The future vision combines tech advancement with data-driven, personal, and human interactions. It’s a new era where every interaction is informed by insightful data, yet feels uniquely personal and deeply human. This delicate balance is crucial for fostering authentic connections while leveraging technological advancements. Businesses across industries are beginning to view their relationship with data through a new lens, recognizing that data is not just a tool for efficiency but a means to enhance the human experience. As organizations strive to create more personalized and engaging interactions, they are redefining the role of data in shaping meaningful customer relationships and driving innovation. The future will see a harmonious integration of technology and humanity, where data empowers businesses to deliver exceptional and tailored experiences while retaining the warmth and personal touch that builds lasting bonds with their audience.
Boost Your Direct Bookings with AI and Data Insights
