Innovation drives Digital Marketing

The possible routes for disruption in hospitality industry are not too hard to find. Even, as we read this, entrepreneurs are chipping away at the gaps that traditional players have left open.

Adam Smith is famously attributed with the term ‘invisible hand’ in how it creates equilibrium between supply and demand. Joseph Schumpeter was more direct and more brutal – ‘ creative destruction’, a term coined by him that implied one thing – Innovate or Die.

The hotel industry will do well to pay heed to the two gentlemen prophets of economics. Hotels in India are essentially, in a state of flux. A storm of innovation in technology, and the cropping up of alternate business models, is buffeting the industry, while giving very little elbow-room. Just when a business model seems to be settling down, along comes someone with a disruptive business model to ‘destroy creatively’.

Can the hotel industry be under the illusion that it will be protected from this rapidly-changing world? Can it afford to wait for its Uber moment?

Look at Uber. Who had heard of it a couple of years ago? Banking issues notwithstanding, today they are handing out nightmares to almost all established players around the world. A mobile app, and providing heightened convenience to customers, is the core of the model.

The possible routes for disruption in hospitality industry are not too hard to find. Even, as we read this, entrepreneurs are chipping away at the gaps that traditional players have left open; creating solutions, packaging them and selling them back to the same traditional players.

One of the biggest gaps that the hospitality industry is leaving open is in the digital space. And before we go further, let me make this statement. Digital in hospitality, cannot work when divorced from the brick and mortar. That is, digital in hospitality is not just a website and driving traffic to it and try and create conversions.

The current giants in ecommerce – Amazon, Flipkart, et al, have built their business model of selling products, which can be standardized. When you buy a smartphone, you know exactly what you are going to get. There are variations in delivery experience, packaging etc, but at the end, if the product is fine and you get a good deal, you will buy again.

Not so much in the digital space for hospitality. Here, the model is of service e-commerce. This can only work well when there is a virtuous cycle created between what the guest is sold and what they actually experience. A good digital marketer might be able to create the best experiential website and lure the guest to book using visual tools and excellent UX ( user experience) design and great deals. But if the guest has a below average experience, or god forbid, a bad one, they will express themselves - on TripAdvisor, Facebook, Twitter and so on.

We all know people research using the Internet before making any purchase – product or service. But here is the critical difference. For products, people search for reviews of the products themselves. For service, they look for reviews of the service provider. For buying a Canon DSLR, you will not research reviews about Amazon. But for a holiday, you will search for what people have talked about the hotel!

So, when we talk about the future of digital in hospitality, we need to start with noting and acknowledging this very critical difference. Hotels will need to keep on tightening the synergy between what is online and what the guest will actually experience. It’s great if the promised smiling service is actually felt on the ground when the guest is checking in after a long ride from the airport. The home-cooked food experience is a great talking point, if the food actually tastes like what your mom may have made (ok, so even if it’s close, people will love it!). The operations team and the digital team cannot live in alternate universes, and need to be aware of what is happening in their own domain. The upside? Guests will talk great things about you who will come up in search results and the good old word of mouth will grow your business at internet bandwidth speed. The downside? Haven’t we all read reviews which had words like “not at all how it looked on their website”?

This brings us to a related field in digital that often tends to be overlooked, because of our razor-sharp focus on visible RoI – social media. Social media is the digital equivalent of a massive loudspeaker. And it is increasingly becoming a part of the search results when a potential guest is searching for the next stay. And TripAdvisor is simply the tip of the iceberg. Facebook, Twitter, Google Plus, Google Business listings, Google Business reviews, YouTube, Instagram are just the major ones we should be looking at and managing. These are places where people are talking about how they feel about you. If you are not on them, not only are you losing potential customer voices, but avoid them long enough, and you will soon be considered a business in the Paleolithic era.