2024 State of Hospitality Software

The hospitality industry is one of the oldest and fastest-growing commercial industries in the world. By nature, the industry has learned how to deliver worthwhile guest experiences built on personalized connection and interaction. But that doesn’t mean technology can’t be used to create the final product: a seamless experience for your guests and your staff. In this post, we will explore the state of technology in the hospitality industry and how technology can benefit hoteliers without sacrificing a personalized experience.

Businesses are more willing to adopt.

According to Hotel Tech Report, here’s why hotel respondents found technology valuable, showing that most hoteliers believe technology has the potential to tangibly shape guest-facing and back-office processes:

• 39% — able to improve operational efficiency.
• 31% — able to transform guest journeys.
• 15% — able to improve business agility.
• 13% — able to prime the business for future innovation innovating for the future.

Businesses are making more room for new tech in their budgets.

To keep up with growing demand during continued staffing shortages and evolving guest expectations, the hospitality industry has had to act fast to incorporate technology into their budgets. Fortunately, the industry has made encouraging progress, as evident by Hospitality Technology’s recent study:

• 2022 – 23% of a typical hotel’s technology budget is allocated to new software, with most of the budget being used to maintain existing systems.
• 2024 – 69% of a typical hotel’s technology budget is allocated to new software, with most of the budget still being used to maintain existing systems.

Businesses are using tech to attract and retain staff.

Technology can be used to create a seamless experience not only for your guests but your staff as well. In a study done by Oracle in partnership with Skift, it was found that adding new technology is the best way to solve staffing shortages and attract stronger talent. Other studies’ outcomes support those findings.

• 54% of hoteliers surveyed said they were implementing technology that would improve the front desk experience – or eliminate it completely by 2025.
• 68% of hotel executives reported that incorporating new technologies to attract and retain staff best reflects their 2024-2025 labor strategy.
• 71% of hotels saw a decrease in guest complaints thanks to a more streamlined, efficient staff.
• 31% of hoteliers said technology was helpful when running with a leaner team.
• 89% of property-based respondents said technology makes their teams happier.

Businesses are adding digital payment options.

Demand for digital payments is on the rise, putting pressure on businesses to adopt them. But there’s significant benefit to the merchant, too.

• The digital payments market's total transaction value is projected to reach US$ 10.64 trillion in 2024.
• 73% of small businesses say that digital payments are an essential part of their growth plan.
• Reports also suggest that businesses that implement digital payments can gain more speed, more data, enhanced security and fewer declined transactions.
• Recent research shows that when asked what their most desired new PMS feature would be, 67% of hoteliers said integrated payment processing functionality.

To adapt, 56% of hoteliers currently use a third-party payment gateway to process payments while 39% use an integrated payment processing functionality in their property management system.

Businesses are continuing to invest heavily in security.

Using cybersecurity technologies is a big deal in the hospitality industry. In fact, despite the economic challenges the industry has faced in the last few years, organizations show no sign of decreasing their investment in cybersecurity. Over half of IT leaders in the hospitality industry say that cybersecurity is one of their c-suite's top concerns, ahead of staff retention, supply chain management, and inflation. This is because the average cost of a data breach in the industry was 3.4 million dollars in 2023.

Hospitality technology not only supports hotel operations but also enhances their performance. By utilizing the right technologies and letting them run in the background, hoteliers set themselves up for success. There’s something to be said about putting your mask on before helping others. The technologies available will create endless possibilities for you and your front office while protecting your bottom line.