Achieving the balance in hospitality with analytics

Happy New Year Analytic Hospitality Executives! I trust that you enjoyed the holiday period and have returned from the holidays well equipped to deal with the year ahead.

At the conclusion of last year, Kelly explained that throughout 2013 we will be focusing on how to build a strategic analytic culture within your organization. This is a much discussed topic around our office. Today I wanted to bring you into the conversation and share our vision for how to integrate analytics into your organization. We’d love to hear your perspective on how this maps to where you are.

Working in a company solely focused on analytics, it has been very exciting for us to see pockets of analytic competency emerge in the hospitality industry. Analytics can help hospitality companies achieve the fine balance between delivering memorable guest experiences and driving revenue and profits. For many of you, I know that balance ends up looking a lot like the teeter-totter show in the illustration below (or, if you are from the same side of the world as I am, the see-saw). If you focus too much on increasing the revenue and profits side, and you negatively impacting the customer experience side. Likewise, focusing on increasing customer experience can negatively impact revenue and profits.

This balancing act can be draining on your organization and make you feel like you are constantly switching from one side to another in the attempt to achieve some stability. This is where analytics can help. Predictive analytics, such as forecasting and optimization, have been used in revenue management applications in hospitality companies for many years. But, revenue management analytics currently only addresses one side of our teeter-totter – the revenue and profits side.  As hospitality companies are in the business of selling an experience, we should also focus our analytic efforts on our relationship with our guests and patrons.

Every contact that your guest or patron has with your organization is an opportunity to increase the value of that relationship. Committing your organization to a 360-degree view of your guests and patrons starts with a concerted effort in data management.  Consolidated information about your guests and patrons allows you to understand their total current and potential value, helping you to evaluate and optimize your offers.

Analytics does not just optimize revenue, but can also optimize your contact and service operations, enabling you to serve your customer in a manner that is not only more personalized, but also more profitable. Surfacing the needs and preferences of customers can help you design your service offerings, ensuring that your spaces are configured for the correct activities and that your resources are deployed where they will be most effective.

Analytics can help to achieve the balance between profits and customer experience, but they must be ingrained in a hospitality company’s culture to have full effect.  For many, the journey to a strategic analytic culture starts with quick wins, through the introduction of analytic tools into select departments within their organization. Creating these pockets of competency provides the momentum that is needed for an organization to aspire to an overall analytic culture. However, the real advantages come when analytics is used to integrate decision making between departments.

Integrating decision making between departments can start to break down traditional silos and allow more forward-facing decisions at a higher level within an organization.  As the use of analytics spreads through an organization, effective presentation of analytic outcomes becomes critical. Hospitality executives are simply too busy to consume analytics at the same level of detail that most analysts must.  Presenting analytic results in a visual format, whether charts or graphs that highlight high level business opportunities is important to elevating the use of analytics to the executive level. And buy-in at the highest level of the organization is crucial for sustaining a proactive, integrated analytics program in any organization.

Later this week Kelly and I will be at the eye for travel Smart Travel Analytics show in New York City. Over lunch, we’ll be hosting a round table to discuss how to build a strategic analytic culture in your organization. If you are at the conference – please drop by and say hi – we’d love to hear how you are working on integrating your analytic efforts.




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  1. [...] spoken before in this column about the advantages of making proactive decisions with analytics.   Reactive analytics are [...]

  2. [...] made the point in previous blogs that analytics help hospitality executives achieve that critical balance between providing a [...]

  3. [...] started out the year discussing how analytics can help hospitality executives achieve the crucial balance between providing an excellent customer experience and meeting revenue & profit [...]

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  • About this blog

    We’re hospitality industry specialists at SAS, the world’s leader in business intelligence and analytical software. We’ve partnered with The Center for Hospitality Research at Cornell University to find solutions to hospitality industry challenges. In this blog we will leverage the existing knowledge of the faculty, existing research and the experience of industry peers to answer the questions that hospitality executives face every day. Questions regarding topics such as revenue management and price optimization, social media analysis, sustainability, patron/guest lifetime value optimization, labor planning and marketing automation and optimization.
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