Amid COVID-19, businesses have speeded the adoption of digitized technologies in their customer and supply-chain strategies to stay competitive in this economic environment. During the pre-pandemic period, company executives didn’t leverage tech-powered capabilities into their business. After the crisis, they prioritized digital transformation recognizing the technology’s significance as a crucial component not only of economic performance but business performance as well.
The hospitality industry is one of the most affected sectors by the pandemic. Therefore, to drive operational efficiency and ensure great customer engagement, hoteliers have started to adopt SaaS-based hotel management system software. And it’s not rocket science since a modern HMS adheres to the market trends and new technologies:
- Cloud-based computing. Harnessing the benefits of the cloud, hotel businesses get the vast opportunity to eliminate costs regarding the setting up of the on-site server hardware and related expenses as well as ensure the scalability of their business.
- Mobile technology integration. 62% of hotel guests prefer check-in/out via hotel apps in comparison to 30% of respondents who prefer using web pages. Being one of the leading factors for hotel management software adoption, the mobile powered by connectivity, sensors, smart building technology, ML, and AI provides even more prodigious conditions for comfortable and personalized experiences. Just to name a few: online restaurant reservations, room lighting and temperature control, automated music turning on, door closing/opening, etc.
- Personalization. A business that prospers in demonstrating personalized experiences to its customers is likely to have greater revenue growth and better customer outcomes. With a comprehensive data-driven approach toward building brand loyalty, the hospitality industry has the potential to deliver customer lifetime value. Thanks to hotel management systems equipped with data analytics, hoteliers can get vital business insights about personal customer data in guest profiles and transform them into actionable and customized decision-making offers.
What Is Hotel Management System Software?
Hotel management system software is geared to handle multiple administrative tasks and overall business operations to optimize workload and deliver superior guest experiences. To effectively manage hotel data and achieve a solid market position, business players in the hospitality niche have to ensure high data integrity and accuracy.
Businesses face a plethora of data deluged from multiple data touchpoints, which leads to a scattered and unstructured flow of information that cannot be properly operated. That’s why HMS is aimed at ensuring robust data management to enhance such front-and-back-office capabilities as guest check-ins/outs, booking reservations, channel management, housekeeping, payment processing, and human resources management. Instead of tackling paper-intensive routines, HMS facilitates all these processes by integrating data and turning it into a centralized location of analyzed analytics and valuable assets.
Why You Need a Custom Hotel Management Software: Benefits
According to the Oracle report 2021, there are the following benefits businesses can gain from the right property management system. We considered them and outlined related values our team experienced while implementing custom hotel management systems for our clients.
- Enhance customer experience. By applying HMS to your business strategy, you centralize customer data, improving its quality and accuracy which, in turn, improves the understanding of customers’ buying patterns. Moreover, when daily tasks are streamlined, staff members are more willing to be focused on guests’ loyalty and retention. Additionally, AI-powered guest communications integrated via smartphones and IoT give hoteliers an enormous treasure trove of upgraded opportunities for business operations.
- Enhanced data collection and control. Since hotel management systems are purposed to retrieve data from various data points, the information you get will eliminate siloed approach toward data collection. Therefore, you can get a holistic view of all the events and transactions performed by your clients. Based on the data obtained, you can adjust your marketing approaches, and optimize planning and scheduling with the consideration of each guest’s preferences and behaviors. To build strong relations with your clients facilitating brand loyalty, it is a good idea to analyze your customer base by performing market and guest segmentation. The hotel management system will help keep track of all visitors and the details of their history.
- Elimination of repetitive tasks and operating costs. With custom hotel management software, your business can be more streamlined since most of the processes will be automated and distributed across separate software modules devoted to each working environment that can be integrated into one solution. Therefore, such administrative tasks as organizing schedules, setting multiple spreadsheets and paper forms, housekeeping, booking procedures, etc. – all these can be automated, reducing the personnel’s workload and facilitating their efficiency and productivity.
- Increase booking rates. The booking engine in the hotel management system generates appropriate queries from the visitors that are transferred automatically to the staff members. Moreover, with data obtained about previous visitors’ experiences, hoteliers can be equipped with personalized offers tailored to the visitors’ preferences.
- Data-driven decisions. When you have the possibility to integrate different branches of your hotel operation such as front-end and back-end processes, channel management, point-of-sale management, housekeeping, and more, you get a holistic view of all business processes inside out via comprehensive analytics and reporting tool. With this data at your fingertips, your employees can make intelligent data-driven decisions impacting your revenue rates.
Structure of HMS: Modules and Features
To select the right hotel property management system, you should be acquainted with its structure. Typically, such a system encompasses various modules the functionality of which can vary due to the business requirements. Basically, the structure provides for the combination of the following modules:
- Reservation management;
- CRM and customer data management;
- Front-desk operations;
- Back-office management;
- Revenue management;
- Channel management;
- Report & analytics;
- Point-of-sale services.
The reservation module is an integral part of the hotel management system since it is responsible for guest interactions which start from online booking. The reservation management module covers such data as dates of check-in/out, customers’ personal information, guests’ number, preferences, etc. The reservation system is integrated with the website booking engine data which is transferred to the front-desk office.
Among the functions of the reservation module, we can mention: online bookings devoted to efficient management of room inventory and allocation and collection of electronic payments that are afterward sent to the front desk.
Front-desk operations fueled by the system are more streamlined and optimized since hotel management staff can track the status of the rooms available, keep track of guests and their requests, manage payments, etc. once they get all the insights on the user-friendly dashboards. Tightly connected with the reservation module, the front-office module ensures fast access to the room status with the possibility to smoothly update the information about reservations.
CRM & customer data management
Structuring the data regarding guests and visitors can be a tough task, especially when there are vast data sets from different sources. It is of high priority for you, as a business owner, to organize data about your customers in a way it is properly and easily managed so that you can retrieve all the necessary information in one click wherever you are located (and your team members as well). The cloud-based system may include the history of customers’ stays and bookings, their loyalty cards, and other details which can help create the portrait of your guests and nurture them accordingly.
Integrated with HMS, the CRM system is purposed to collect customer data and transform it into actionable insights used to create efficient marketing campaigns and loyalty programs.
The channel management module is geared to increase visibility across different touchpoints where audiences can get access to your hotel. These distribution channels (online travel agencies (OTAs), booking platforms, global distribution systems) are the gateway to the extension of your digital presence. Whether your client comes from a third-party airline company, or directly via your corporate website or mobile application, the interaction between the channel and the client has to be synchronized to one centralized hub to prevent discrepancies and ensure a direct connection with a central reservation system.
Furthermore, if you have access to the centralized reservation system, all the data about room availability, costs, and bookings are available in real-time across multiple channels so that all the processes are performed consistently and seamlessly. In addition, such an automated approach helps reduce the manual involvement and facilitates the allocation of listing rooms on various sources.
With revenue management systems, hotel companies get a comprehensive evaluation of the financial state of their business by tracking such KPIs as average daily rate (ADR), bedroom occupancy rate (BOR), and cost per occupied room (CPOR). By analyzing these indicators, a revenue manager can forecast conditions that will accelerate your revenue growth. In a nutshell, the revenue management module constitutes a crucial part of price development and adjustment.
This tool helps conduct profound research of competitors’ market and compare pricing and market rating between other players in your niche. To determine optimal rates, the system assesses the effectiveness of various channels and uses historical data. Based on this data, you can define the optimal price according to supply and demand, events and season fundamentals. With revenue management systems, hoteliers can enhance pricing strategies and adjust them automatically across multiple distribution channels.
This module allows for automated management of housekeepers’ tasks and connection with the front office. So if a housekeeper wants to change the status of the room, or make any amendments to the maintenance management, there is no need to connect with maids or other related persons to notify. With the help of a mobile app integrated with the system, housekeepers can make updates and track room states.
Back-office management and Point-of-Sale
With this module, HRs and other managers enable efficient and effective interaction inside the company by having instant access to all the administrative hotel operations and other related data on staff invoicing, hotel expenditures, event management, point-of-sale services (spa, gym, food and beverage, Wi-Fi, etc.), internal operations regarding sick leaves, salaries, days-off, and vacations.
Reports & Analytics
Analytics is an essential business intelligence tool allowing you to evaluate the current state of your business performance. A typical hotel management system includes a revenue manager and report aggregator where managers can track income and expenses, revenue variations, business performance analysis, and other valuable metrics that are generated and represented on the dashboard in the format of reports.
Ready-made vs. Custom Hotel Management System Software: What to Select?
There is no unambiguous answer since the selection of the solution for your hotel depends on the specific requirements of your business, financial capabilities, and the size of your company. In comparison to an off-the-shelf system, a custom solution gives more control over your data and flexibility in implementing the types and number of modules that are necessary for your specific needs, ensuring a more personalized experience for your customers.
Regarding the financial part of this selection, it is worth noting that a ready-made hotel management system does not need additional and special hardware to install, which is a significant factor for businesses looking for an appropriate solution. However, that does not mean that ready-made software is a cost-effective solution since it can contain unnecessary features that you have to pay for by default.
When you are planning your business to scale up, packaged off-the-shelf software has limitations and at the same time can be filled with extensive features that your specific use case doesn’t need. Let’s outline the main benefits and drawbacks of each solution by category.
For non-standard business processes with unconventional workflows, ready-made solutions are likely not to satisfy your needs.
Brief Guide for Hotel Management System Development
As with any other software development following the modern Agile approach, the hotel management system requires covering such product development stages as discovery, UI/UX design, iterative development, testing, and deployment. Follow these steps to grasp the ultimate vision of the solution architecture:
- Market research. Your competitors have to be an initial point to proceed further. Compare their solutions, how they interact with their guests, and what functions software management vendors offer.
- Define your business needs. When you have a precise vision of your business performance and KPIs, you can easily elaborate the plan for your new business project.
- Define the list of the system’s functions and module architecture. Above, we named common functionalities the system should contain to deliver results. You can start small and extend modules according to the scaling needs of your business. That’s why a custom system is suitable in this case.
- Decide on a tech stack. You can hire dedicated software development teams tailored to your specific requirements.
- Ensure integration between different hotel tech systems. It is a significant step since all the necessary APIs have to be integrated seamlessly into your HMS.
- Come up with design ideas. The interface of the system has to be user-friendly for employees and provide them with easy access to all the critical information.
- Testing. User acceptance testing is a must-do to prevent additional deployments and expenses in the long run via conducting agile iterations that our developers adhere to.
So How to Proceed with Custom Hotel Management Software?
First of all, you have to define your bottlenecks, the necessity for third-party integrations, anticipate your scalability capabilities, choose the technology stack, and compare the best candidates for the position for your tailor-made project.
How much does it cost to build a custom hotel management system? A crucial factor in defining the price for the solution regards the required functionality and your partner’s hourly rate. To get more accurate numbers and evaluate the experience our software product engineers possess, provide us with your business requirements and specifications.