Monday, 3 November 2014

Hotels and the dotcoms

Last week, in fact on my last post there was a comment from one of the readers asking me whether I had stopped writing on the topic of hospitality. It certainly got me thinking and here comes the post, don't know how good, bad or ugly it is but I wish to dedicate this one to that reader. I belong to the old world of hospitality. Can call it Old world as I belong to the mid 90s when there were  a very few hotel schools and institutes in the country. There were also no foreign hotels or hotel chains operating in India, barring a few big hotels that had franchise or management contract of the Intercontinental, Penta or Kempenski to name a few. The big players being the Taj, The Oberoi, The Leela, ITC  Welcom Group, The Park hotels etc.
This was also the time when a few people flew, if someone travelled by flight within the country, there was a fear that probably something unpleasant had happened or there was an emergency. No wonder every movie made at that time, especially the ones made by the Bombay film industry had atleast one airport scene. The heroine of the movie was generally introduced coming home from vilayat!

Five star hotels were truly five star, an exclusive product that had the snob value to it. The guests were also fit to be there. A bit of ego massage always went a long way. A guest being recognised and addressed by his name. Guest histories maintained to delight and dazzle the guest on the next arrival. Customer satisfaction was not the buzz word anymore, everyone did that, something better was thought of every moment. There was competition among hotels to offer better products or services. Innovation always got appreciation and was also paid! They could charge premium for using things as simple as better toiletries and guest amenities.Hotels started moving from having soaps, shampoos, shower gels and moisturisers having the hotel name and logo on the wrapper or the label to them showing off some good brands. We have come a long way now the hotels showcase their amenities. 
There was a distinct divide between a 3 star hotel and a 5 star property. The rates were a clear indication. One knew what to expect and at what price point. Bookings were through the sales offices around the world, I believe it was quite personalised that way and some GDS (Global Distribution System like the Amadeus, Galileo, Sabre, Worldspan etc) were used. GDS was used more by the airline industry since they already had a huge network across countries and continents, it became the next best thing to be used by the hotels for managing their reservations.  Utell was used by hotels for their reservations and there were others like the Leading hotels of the world or SRS hotels and similar others that managed reservations as well as publicity and promotions for the member hotels. The product that these organisations dealt with was purely hotels. They understood and valued the product. Understood their clients and also the operational aspects of a hotel. 
Then came the flood of dotcoms, handled and managed by software companies somewhere they became distributors for hotel rooms. Expedia, Makeytrip, Cleartrip, Trip advisor and many others. For them it became a business to manage the room rates, indirectly though. In fact they slowly and steadily got into the hotels, gave then guaranteed business and bought a good chunk of their rooms. Hotels didn't mind it, as they got a steady business.The dotcoms took almost all hotels in their wings. It became necessary for the hotels to be a part of these intersell agencies (selling more than one product line). The dotcoms started indirectly dictating terms to the hotels. Hotels had to list themselves not with one of these but almost everyone. Revenue management became a key expertise in the hotels. Now along with the sales and Front office, revenue management became a very important and crucial portfolio.

The dotcoms have made the business of hotel and hotel booking easier and transparent. But this level of transparency is not always that good for the business. The repercussions of this has affected the hotel industry greatly. The hotels don't make much profit so there isn't much left to be reinvested in to the business. Reinvestment is required to develop and refresh the product. Some hotels are badly hit, this has lead to the product deteriorating and downsizing of staff has led to poor service quality too. The measure can be as drastic as shutting down of the property itself. In fact there was report of a hotel owner committing suicide recently. Don't really know the reason but somewhere this thought came to my mind. I may not be correct, but its definitely something to be looked at.

Hospitality is all about personalised service, it certainly cannot be completely driven by technology. Guests and customers who value good service need to also bear in mind that asking for discounts and low rates are not sustainable measures. It's said that hospitality and good service never goes out of fashion!... it seems to have got mixed up somewhere but there is certainly a need to bring back the charm of old world hospitality.

Pictures are taken from Google, with due credits.