In an industry generally marked by its traditionalism, there is huge opportunity for transformation within hotels. From areas such as guest experience to internal workflows, technological advances have set new standards for all areas of operations. In an exclusive interview, Leland Pillsbury, Managing Director of Thayer Ventures and Founder and Co-chairman of Thayer Lodging Group, shares insight from his extensive track record of leading hotel innovation.

LM: Has luxury travel become commoditized?

LP: Absolutely not! Just the contrary. As technology has advanced, it has enabled travel providers to “fine tune” their services, facilities, and amenities based on data they are collecting on usages, and preferences. At the same time, this technological advance provides the opportunity for suppliers to provide “bespoke” services and experiences.

LM: What areas of the hotel industry most suffer from lack of innovation?

LP: The single biggest challenge is replacing the legacy reservations and property management systems that are outdated and antiquated. As result, nimble new companies are taking advantage of their limitations and weaknesses to develop systems that disrupt the traditional revenue management systems for hotels.

New revenue management systems that are yielding 6-8 points of REVPAR index for hotels require CRS/PMS systems with much more robust capabilities to handle massive amounts of data that the legacy systems simply cannot process. These new systems can also be used to provide much more powerful guest services based on the information they can collect and manage. However, existing systems are hugely complex and new systems are extremely costly.

Efforts to replace and upgrade them have been met with only limited success. The answer most likely is to build simpler systems that “sit on top” of these old systems and essentially reduce them to “dumb cash registers,” at which point they can be more easily replaced and updated.

LM: Are there aspects of guest experience that you think could be automated without losing the personal touch required for service?

LP: Many. For example, room service breakfast is a service that could be better provided by a robot. Let’s face it, dealing with a room service waiter whose arrival time is somewhat unpredictable while you’re trying to shower and dress in the morning is fraught with opportunities to be embarrassed or inconvenienced. A robot delivery would avoid all of that.

Another example; Check In. Today, the “head down in the computer” desk clerk spends the majority of the time during the check in process interacting with the CRS, the PMS, the key maker, et al. That can all be made transparent to both the clerk and the guest. Another example: Dishcraft Robotics is building robots to scrape, clean, and load the dishwashers, with better sanitation, less breakage, and lower labor costs. Automation of back of the house activities enables a greater focus and more resources deployed on the guest-facing activities.

     “I expect you to know a lot about me, and to tailor your service based on that knowledge.”                                                                                                 

LM: Do you think that technology and the new capabilities offered are raising the standards of service and expectation?

LP: Very much so! I expect you to know a lot about me, and to tailor your service based on that knowledge. If I stay with you 10 times, why do I have to show you “photo ID” every time? Why don’t you recognize me? It’s not like I’m in disguise! Same with my credit card. You know what card I use, you know the expiration date. After 10 visits, are you really worried that I’ll try to beat you out of room and tax? It’s disappointing that, as one of your best customers, about all you really know about me is my frequent traveler number in your points program, and my service experience is the same as a first time guest.

Here’s another thing: you should be doing much more to monitor how my stay is going, and seize opportunities to earn my love. For example, using Local Measure, it’s possible for the hotel to know what I’m thinking and saying about my stay as I’m thinking and saying it.

In the hotel guest room…I don’t want a lot of your fancy technology: iPads, and other gizmos. I travel with my own technology, and what I want is to be able to use that. I have my own media content, which I want to push through the hotel television. Interesting to note that the airlines are taking the TVs out of the backs of the seat headrests and instead moving to systems that will stream the content onto the passengers’ own devices.