Home Economy The post-pandemic future for the hotel industry

The post-pandemic future for the hotel industry

Sai Ranganathan
Hoteliers and other travel industry stakeholders must embrace smart technology to meet future hospitality needs and ensure long-term viability
Co-founder and CEO of SensorFlow
In one of the rooms of a boutique property with a sofa set overlooking a private swimming pool in Bali, Indonesia

2020 was a rough year for everyone in the hotel industry. In March 2020, travel ground to a halt as the pandemic accelerated globally. This sent the global hotel industry into a tailspin. Small and large properties alike executed similar crisis response strategies to weather the storm – from shutting down floors to offering attractive packages for later stays, and from diversifying income streams to finally, reducing headcount.

Now, travel is on the upswing once more, but the landscape has changed a great deal. Hotels, still reeling from the losses suffered at the height of the pandemic, must now contend with new challenges such as increased guest scrutiny over health and safety, a higher demand for contactless services and improved sanitisation standards. Hotels need to adapt quickly to survive, and as with all industries, it is imperative they look to technology as a catalyst for change. 

The impact of the pandemic

While the pandemic affected all hotels, larger multinational players were better able to endure the economic hit. They had more resources to pivot their operations and transform their spaces to meet new guest expectations. They were also further ahead in their journey of leveraging smart hotel solutions for better productivity and energy efficiency, which eased their rapid transition towards digital transformation. For instance, international brands like Hyatt and Frasers Hospitality had better access to resources to keep up with industry guidelines, which helped inspire trust among guests.

Smaller hotels trailed behind because they tended to work within a limited bandwidth, which affected their speed and ability to adapt to new demands and protocols. Not all of them had the space necessary to capitalise on opportunities such as becoming quarantine facilities in government-supported pandemic quarantine programmes, which eliminated an alternative revenue stream. Without the global prestige of the bigger chains, guests were also less confident in their quality of service. As a result, many smaller hotels closed, while larger hotel brands remained relatively intact.

Technology as an equaliser

In pre-COVID times, technology solutions for hotels had the unflattering distinction of being costly and disruptive to install. For instance, many providers and vendors required hotels to do a complete overhaul of their cooling systems to implement a new energy-saving solution. This led to properties being slow to embrace technology even though it could significantly improve their productivity and bottom line.

The pandemic has changed that. Hotel operators have become much more willing to explore technology solutions to resolve their issues with efficiency, productivity and sustainability. This, coupled with new innovations in the tech space that directly address previous issues with cost and disruption, makes it much more viable for hotels to embrace technology. It enables them to capitalise on benefits in operational efficiency, cost reduction of utilities and enhanced sustainability. 

The post-pandemic way forward for hotels is to embrace digital transformation with an open mind. Agility and innovation will be hallmarks of the new normal.

For example, SensorFlow’s IoT and AI-driven solution is completely built in-house, is retrofittable and can be installed in barely five minutes. Offered at zero upfront cost and on a profit-sharing model, this solution provides instant energy savings. Thus, hotels face no financial risk or operational disruption, which is particularly beneficial for smaller players on limited budgets. The solution provides real-time data and comprehensive key trends and actionable insights on room occupancy and energy consumption, as well as heating, ventilation and air-conditioning (HVAC) system performance and equipment faults. Hotels can thus optimise housekeeping and event planning, identify and resolve system faults immediately with predictive maintenance, and ultimately improve overall guest satisfaction. At the same time, hotels can also reduce their carbon impact on the environment.

The benefits of these technologies have already proven their worth over the course of the pandemic. Absolute Bangla Suites in Phuket, Thailand, saved up to 25% of monthly HVAC energy consumption by automating 67 AC units with SensorFlow’s smart room automation solution. The remote room monitoring solution for extensive property insights also enabled Origin Seminyak in Bali, Indonesia, to optimise HVAC usage by 33% across its 24 villas. It also allowed humidity management and predictive maintenance strategies when the villas were closed to avoid room deterioration.

When choosing a technology provider, hotels must consider a few prerequisites. The most obvious consideration is the end savings they will achieve from using the technology. The next step is evaluating whether the technology provider is aligned to the hotel’s vision and can support them long-term, as this will be an ongoing partnership. The solution should also not entail a high CAPEX cost; otherwise the main hurdle for hotels to adopt technology solutions will persist, especially for smaller properties.

Looking to the future

With the world still in flux, it is too soon to make any concrete predictions. However, one thing is clear. Key stakeholders such as hoteliers, tech providers and investors need to come together in bringing viable technological answers to meet future hospitality needs. It is also crucial for all parties to align their expectations and understand that technology adoption is a long-term solution, not an instant cure-all. 

Travel is on the upswing once more, but the landscape has changed a great deal. Hotels, still reeling from the losses suffered at the height of the pandemic, must now contend with new challenges.

We expect hoteliers to adopt technologies that present the best value in terms of delivering expenditure and operational efficiency, as well as cost savings. Technology providers must take note of their needs and develop solutions accordingly. However, providers must also look at ways to keep costs down to encourage more hotels to adopt their solutions. Only then will prospective investors be encouraged to invest in the providers, which will fund more innovation.

More widespread implementation and dependency on technology solutions will naturally lead to a leaner, more highly skilled workforce among hotels. It is likely that hotels will reduce manpower by up to 30% as menial tasks are delegated to technology. The remaining staff will be trained to manage different programmes and processes, resulting in a more versatile team that can adapt to new challenges.

Ultimately, the post-pandemic way forward for hotels is to embrace digital transformation with an open mind. Agility and innovation will be hallmarks of the new normal. Adopting technology as their new partner will help hotels evolve with the times and step confidently into a new era of travel.

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Author profile
Co-founder and CEO of SensorFlow

Saikrishnan (Sai) is the CEO and Co-Founder of SensorFlow, a Singapore-based proptech startup which offers hoteliers a smart solution to reduce their energy consumption, optimise their operational efficiency and achieve their sustainability goals. Alongside his co-founder, Max Pagel, Sai set up SensorFlow and envisioned that it would make smart buildings a reality by leveraging data and AI to make properties more energy-efficient, productive and sustainable.

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