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The Caribbean and Latin America as the new focus in the hotel industry

The Caribbean and South American hotel industry is growing and particularly the luxury segment. However, operators have to be very careful with the usage of technology as human relationship and service is much appreciated by customers.

The Asian continent has been booming in the past few years. It still has a lot of potential and many of the leading hotel brands have several construction projects in the pipeline.

However, locations in the Caribbean as well as in Latin America are getting some attention, too (Caribbean Journal, 2018). Even though these places are often struggling with natural disasters such as hurricanes, the tourism industry is growing (ITB Berlin, 2018).

It is important to mention that a special focus lies in the luxury properties.

But, how do we actually define this segment?

The word “luxury” comes originally from the Latin word “luxus” which can be translated as a rare and exclusive item that not everyone can afford, comfort but also excess (Merriam-Webster, 2018). However, Camilo Bolanos, VP Development and Real Estate at Hyatt Hotels Corporation, states that more and more, luxury is defined based on experiences.

It is therefore more important to pay attention to the quality of service and staff training. He also mentions, that it is utmost important to try to train staff to never having to say no to the customer. A restriction in this policy directly represents an issue in a luxurious service. (Bolanos, 2018).

A hotel is often redefined as “a home away from home”. Mauricio Elizondo, Director of Development of the Grupo Posadas, kindly adds that their aim is “to add a WOW-effect that you wouldn’t have at home” (2018). Nowadays, human beings have a high level of comfort even at home. Therefore, guests are looking forward to an exclusive and exquisite stay when they enter a hotel.

Staff: A key factor differentiator 

To keep up such a good service and customer contact, it is necessary to pay attention to sufficient and high quality staff training. Also, continuous observing of the steps to improve, need to be done to assure these high standards. “Of course, staff is still human and mistakes happen everywhere, but it is important to be able to address them, acknowledge and improve” (Bolanos, 2018). Concerning the development of the Caribbean island, Karolin Troubetzkoy asks particularly also the big players in the industry to pay attention to this topic.

“Let’s not try to fight against each other but rather try to make the region attractive and showcase that the end-product of regional sources is not as bad as its reputation” (2018). She also points out that relying on local staff would improve the islands’ industry and in the long-run has a reciprocal effect. If hotels invest into local education, in a few years, they would be the one profiting from a bigger pool of possible hires for their industry. This can bring a critical advantage, because these employees bring along the indigenous warmth of the local culture, which would be transmitted to the guests. This can even translate into a competitive advantage if applied in an appropriate way. 

Management should never forget the importance of their staff, because it is key to their success. The impact of how the company treats its employees has a direct impact on their effort and motivation for serving customers (Oates, 2015). Camilo Bolanos enforces that this process already starts when laying out the back-office of a hotel. It should be as well furnished, useful and practically established as the rooms are for the customers. Staff will appreciate when they feel comfortable at their working space and this will influence also their mood, identification with the brand and confidence in contact with the clients.

Technology: A tool to improve service

In several industries nowadays, technology is used as a tool to improve service. This topic has also been discussed at this year’s CHRIS conference. More precisely, experts of the industry were stating their concern around the customer’s wants and needs. Do guests really know what exactly they want? A good example is when customers like being “unplugged” and away from the usual stress when staying at a resort. But at the same time, they get annoyed if the WIFI-connection is slow.

Customers cannot have both services at the same time, because they contradict each other. This is why it is very difficult already deciding on a certain hotel concept as guests change their mind very quickly nowadays. This is also due to the fast adapting social media usage, which affect the change in opinion and definitively also increases their reactivity in their daily life.

Hereby the usage of technology can also be questioned. Several hoteliers agree on the fact that just using social media for the sake of it is only an additional effort and won’t bring them further. It is very important to use it exclusively for those segments where the customer really demands it. This is definitively the case in business hotels or urban areas. However, Karolin Troubetzkoz, the current Director of the Caribbean Hotel and Tourism Association (CHTA), has experienced herself that in remote areas, the use of social media for advertisement as well as information transfer is not supportive.

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Due to the fact that many people travel there to escape from their daily lives, the purpose of their stay would not be achieved. On the other side, there are those customers who wish to share their thoughts and experiences with their family and friends during their stay. This makes it very difficult for such resorts to comply with all different wants and needs. Moreover, it is important to base the decision of service level in line with the hotel’s and brand’s values. In certain cases, maybe technology can be installed upon a specific demand even beforehand their stay.

Besides that, technology can be very useful in other cases. Several hoteliers agree that it won’t be able to fully supplement the human beings especially when it comes to service. This is exactly the area where the luxury segment differs itself from the mid- or upscale hotels. Personalization plays a very important role and this unique approach is often delivered through experiences. Finally, this will again conclude in the fact that training staff and treating them appropriately is key to be successful, especially as a luxury hotel.

However, in some properties, technology can be used to personalize the experience, but not the service itself. For example, in some Marriott properties, the hotel can use it to adjust the air conditioning to the guest’s preferences or switch on the TV automatically when the guest enters the room. By following up the guests’ historic in the brand’s hotels, the guest does not even have to communicate the wishes anymore, but the computer directly registers it in the brand’s commonly used system.

In conclusion, there is a human as well as technological approach to develop the luxury industry in the future. However, the development depends on both and none of the factors can be applied solely to be successful.

Authors: Lara Sutter, Claude Olivier Scheidegger and Yanyan Chen

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