REVolution 1

The Hospitality REVolution: Converge & Conquer

By , Chief Evangelist & Development Officer

It’s time for hoteliers to change how they think about, buy, and align their technology.

On Tuesday, October 29, IDeaS hosted REVolution 2019, a Hospitality Revenue Summit, in London. This event brought together a global community of industry experts to connect, challenge, and influence progressive change and kick off a new era of revenue management.

Now we are excited to share some of the illuminating discussions from the summit with the field’s top minds—from visionary revenue executives to brilliant data scientists—to propel the industry forward and invent the best possible future we can imagine. Today, we begin with the buzzing trend of:

Technological Convergence

As we go through our daily lives, we see a direct correlation between what used to be disparate technologies. Many of the world’s leading tech companies are taking advantage of the power of convergence. In fact, because of the base technology of the Internet, cloud storage, Wi-Fi, app development and mobile devices, technology is merging together at a pace unlike anything we have witnessed before.

Google has morphed from your garden-variety search engine into something much more. Today, in addition to any number of services the software giant has developed or acquired, with the click of a mouse Google makes travel easier and seamless. Additionally, they have developed into much more than a software company, merging with key technology firms, such as Nest, putting them squarely in the hardware business.

From Google Home to phones, from speakers to virtual reality, Google has extended its reach far beyond the computer sitting at your desk. It has virtually expanded its ability to collect data from you wherever you are.

Uber’s ridesharing business model disrupted the automobile and taxi industries through its revolutionary app by providing an easy way to move from place to place without owning a vehicle. It saw the future of mobility and turned the model of yesterday’s auto industry on its head by creating a new model for travel.

Netflix is a compelling story, with more than 30 years of convergence in the making. What started out as a subscription company that developed a unique and powerful logistics model quickly morphed into a continuous data analysis pipeline and a content licensing powerhouse to a content development giant and global media king. In 2009, based on the analytics and data it had gathered, the company developed a streaming service that changed the entertainment industry.

The Three Key Drivers in Convergence

As we look at these examples, we can see a direct correlation to convergence by the advances in technology, driven by changes in customer behavior and enabled by new ecosystems that bring this convergence to life. Let’s take a look at these key drivers:

  1. Technology

When we talk about the advances in technology, one of the biggest drivers in recent years has been the advent, growth and shift to the cloud. As we look at the emergence of this technology, we can’t do so without looking at Amazon.

Amazon went from being a bookseller to a leader in today’s cloud technology services, taking advantage of the ongoing trend of businesses moving to the cloud. In fact, 55% of its profit today comes from Amazon Web Services (AWS), which provides cloud services to technology companies to help them service their clients.

Technology companies take advantage of AWS because of its plug-and-play architecture and its highly-scalable, cost-efficient infrastructure, both of which allow companies to scale quickly. Netflix, for example, must not only store hours of data, amounting to terabytes of storage, but they need to also do so affordably, efficiently and on demand.

  1. Data

The next big pillar in enabling technology convergence is data. As we look at the generation, collection and consumption of data in recent years, we know data is everywhere. As the whole world continues to be converted to data, the amount collected is increasing enormously.

With that comes the challenge of organizing and structuring the data in a way that makes it actionable. This means not only collecting the data but having access to the analytics to make sense of the information being generated.

  1. Artificial Intelligence

The third pillar is artificial intelligence (AI), the means by which the data is disseminated and organized.

A great example of how these three pillars converge can be seen in autonomous driving, a technology quickly becoming a reality in our world. Have you ever wondered about the actual amount of AI it takes to make this technology a reality?

In order for the necessary decisions to be made automatically by the computer, vast amounts of data must be collected, converted and processed in the cloud, in real time, without human intervention. In essence, autonomous driving relies upon the software system and the computer, in this instance the car, by leveraging the cloud, the data generated from a number of resources and AI.

The Age of Convergence Is Now

Convergence is already happening every day, and it is a part of our daily lives, even if we can’t see it. Let’s go back to Uber for example. The company has approximately 50 different applications in their technology stack to make the experience as efficient as possible for both the rider and the driver.

Things such as messaging, geolocation, fare calculations, payments and promo codes are a perfect example of many instances of convergence happening in real time. All of this works together to create the unique, satisfying experience Uber has built.

Disney’s Magic Band and Princess Cruises’ Medallion are other examples of how companies have developed a unique resort experience through convergence. Data is collected, moved to the cloud and processed through analytics to create an unparalleled user experience.

If we apply that idea to the hotel industry, it’s obvious we need to move faster to catch up to the consumer expectations. The industry is showing us what customers want, and it’s our job to provide it to them.

Revenue Management & Convergence

As we see technology moving into the cloud, data becoming more accessible and being generated at a higher frequency, and converged ecosystems of technology companies coming together, we can also see a convergence in revenue management between pricing, distribution and marketing.

No longer is the revenue manager in a corner, crunching numbers. They are now tasked with leveraging the new capabilities of technology, AI and automation. In fact, the revenue manager’s function is increasingly moving toward a converged commercial function, making sure they suggest the right offer, at the right time and distribute it to the right channel.

Today, a typical hotel must make more than 52 million daily pricing decisions. What can we do to stay ahead of that growing number? Automate, automate, automate. It is literally impossible for a human to leverage the data streaming out of the hundreds of devices and data points each of us bring into the mix.

The REVolution Continues

Watch for more to come from IDeaS out of our REVolution Summit.

Wish you could have been there in person? IDeaS’ next summit will be here before you know it.  Mark your calendars and save the date for June 29-30. IDeaS’ 2020 Hospitality Revenue Summit will be held at the luxurious Lotte Palace Hotel in New York City.

Learn more and register now at

Klaus Kohlmayr
Chief Evangelist & Development Officer

Klaus began his experience in the hotel industry while studying at the Hotel Management and Catering School in Austria. He also studied business at Henley Management College, real estate investment and asset management at Cornell, and finance and strategy at the Singapore Management University. Klaus participates in various advisory boards, including HSMAI in the Asia Pacific and the Americas and the Cornell-Nanyang Institute of Hospitality Management in Singapore.

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