As a substitute for the traditional lodging facilities, including hotels, hostels and short-term rentals, the increasing supply of Airbnb properties is no doubt making an impact on hotels' bottom lines. So, can hotels stop the growth of Airbnb?
Hotels are working hard to fight against the competition from Airbnb, other room-sharing websites and online travel agents (OTAs). For example:
Hotels are encouraging travelers to search and make reservations directly on the hotels' websites by offering special discounts if they book directly, even though this strategy might possibly push Airbnb and OTAs to work closely together against hotels.
Hotels are responding to the shifting needs of customers by introducing new brands and through acquisitions. The merger of Marriott and Starwood is a good example.
Most recently, hotels are planning for a lobbying push over the Priceline-Expedia "monopoly," in addition to the legislation push toward Airbnb. Hotels want to play a "fair" game in the competition with Airbnb and OTAs. So far, hotels have successfully convinced legislators to impose stricter regulations on room-sharing operators in several locations, including San Francisco, Vancouver, Amsterdam, and London.
Challenges that Airbnb faces
Despite Airbnb's phenomenal growth since its inception in August 2008, the company is facing more challenges lately.
The question is: Will those challenges slow down Airbnb's growth?
Airbnb's strategies for growth
Airbnb wants to become more than just a leading room-sharing platform in the market, as suggested in the following moves taken by Airbnb recently:
Airbnb acquired a couple of travel service companies, including Luxury Retreats and Tilt, as the company is getting ready to become a full-service travel company.
Airbnb wants business travelers, too. Not only has the company launched a website that tailors to business travelers, but they also work closely with the hosts to ensure the listings meet business travelers' needs. The most recent move Airbnb took was to introduce new booking tools that were specifically designed for business travelers.
What if these changes also take place in the macro level? Then, what can businesses do to embrace this wave of innovations?
Indeed, the cities where we live have also become "smarter" than ever. According to The Wall Street Journal, more cities are now using different types of data to make people's living safer and healthier and the cities' operations more efficient.
The rise of smart cities
The city works with Waze, a navigation app from Google, to improve traffic conditions. Officials are able to respond to traffic problems, such as a double-parked truck or a fender-bender more quickly.
The Department of Innovation and Technology developed an algorithm to predict the risk of a restaurant for spreading food-borne illnesses. The algorithm uses 11 variables in prediction, including a restaurant's past record of violations, length of operations, the weather condition, nearby burglaries, etc.
The data was used to inform the Department of Public Health for restaurant health inspections. The results? Since the program's initiation in 2015, it takes seven fewer days before inspectors visit restaurants with possible critical violations; 15 percent more critical violations are also reported.
Mobile data is used to help clean up the city's 22,000 miles of streets and alleyways. The city uses video and smartphones to collect data about illegal dumping, abandoned bulky items and other trash problems. The streets are labeled with three categories: being clean, somewhat clean and not clean. This program has resulted in an 80 percent reduction in the number of streets categorized as "not clean."
The city of New Orleans put three data sets together to help prevent deaths in fires, including:
homes without smoke detectors (from Census Bureau surveys)
homes at the greatest risk for fire fatalities, such as those with elderly and young children (from Census Bureau surveys)
neighborhoods with a history of house fires
With the aid of machine-learning technique, the city analyzed the data and identified the blocks where fire deaths were most likely to occur. Then, the fire department was able to target high-risk neighborhoods when distributing smoke detectors. Since early 2015, the department has installed 18,000 smoke detectors, as compared to installing 800 detectors per year under the old program.
How effective is it? A few months after the program began, three families (11 people in total) were alerted by the recently installed smoke detectors about a fire, and the firefighters were able to quickly respond to the incident.
Let's imagine how restaurants and hotels can be run inside a smart city
Here are my thoughts:
Restaurants and hotels can share their availability with the city, allowing people to easily locate the restaurants or hotels with empty seats or rooms.
Historic data of traffic, including foot traffic, can be used to predict sales, allowing restaurants and hotels to better manage employees' work schedules.
Restaurants and hotels will be able to get extra help even in the last minute when the city suddenly observes increasing traffic, possibly through the standby part-timers in the city's database.
Restaurants using automated services, such as coffee shops with robot baristas and self-service facilities with no hosts, no servers and no tables, can be built on the street with fast foot traffic.
New lodging products can be invented, where customer service will be provided in a remote mobile service center. Travelers can reserve and check into a hotel room with their mobile device, use their mobile device as a room key to get into the hotel room, have items delivered to their room with a robot, and check out with their mobile device. These hotels only need to hire staff to clean the rooms after the guests check out, in addition to the staff members working in the mobile service center.
Restaurants and hotels that provide customer service with humans can still be found inside the city, but possibly limited to some specific areas, with slower foot traffic and/or a lower turnaround rate.
What are your thoughts?
*The original and full-length of this discussion was firstly published on MultiBriefs.com.
It makes salad with perfect proportions, even with accurate calorie counts.
It can create more than 1,000 salads from the 21 ingredients stored inside the machine.
Those 21 ingredients can be changed over time, making it possible for the machine to create even more salads.
It weighs 350 pounds.
It has a price tag of $30,000, but can also be leased for $500 a month.
"What? A machine that costs over $10,000? That is too expensive, especially when we consider the high maintenance fees associated with the machines. There is no way that restaurants would use such expensive machines to replace real humans at work." — That was one comment I received from my previous discussion.
Actually, $30,000 is not that expensive if we do the math.
Let's say a restaurant pays a cook $15 an hour ($15 an hour will soon become the minimum wage). Let's also assume the restaurant does not pay any benefits for this cook, even though an employer would usually pay over 30 percent on top of a staff person's base salary as benefits.
Thus, $30,000 is equivalent to 2,000 working hours for this chef ($15 x 2,000 = $30,000). If a full-time cook works eight hours a day or 40 hours a week, those 2,000 working hours are equivalent of 50 weeks of work for one cook (40 x 50 = 2,000).
Because a machine can work 16 hours a day without a break (two shifts), as compared to eight hours a day for a cook, those 50 weeks of work for one cook are now shortened into 25 weeks (if two cooks are replaced by the machine) (80 x 25 = 2,000).
In fact, a machine can work seven days a week without any holiday pay, meaning it can work for 112 hours a week (16 x 7 = 112). Then, it will only take 17.86 weeks, or 4.5 months for the restaurant to get the initial investment back (2,000 / 112 = 17.86; 17.86 / 4 = 4.46).
What do you think now? Does $30,000 still sound expensive to you? Most of all, when machines are put to work, there involves no recruiting or training cost, and machines will never call in sick or want to quit.
So, what can we do if we do not want to get replaced by machines?
If you are with me and convinced that most manual labor will be replaced soon, it is now time for us to make plans for the future. My suggestions include:
Strive to be a leader in the field
People can demonstrate their leadership potentials with a progressive career path on their resumes or through the leadership responsibilities they take in professional or student organizations.
Leaders are visionaries and focus on the big things in life. Leaders set good examples for others, but at the same time, they understand the art of delegation. Leaders inspire others and grow with their team. No matter how good they are, leaders never stop learning.
Focus on transferable skills
We need to develop transferable skills, such as leadership, critical thinking and analytical skills, as well as effective communication skills, in addition to the technical skills taught in class or learned at work. The content we learn in class or the ways people do business may change or get updated quickly, but those transferable skills will stay with us throughout our career.
Do whatever it takes to be irreplaceable
The attributes for being irreplaceable may include:
Does it become obvious that the new era of machines serving people has already arrived? I think it is now the time for those who are feeling the panic of being replaced by machines or robots at work to reconsider their career paths. Manual labor will certainly be replaced, and the only way for us to survive in this competition is to become the leaders in the field.
What can managers do to shut down bad online reviews? Here is a real example:
It started at the Broadway Oyster Bar in St. Louis this February when Mary S., a Yelper, left the business with a one-star rating and a description of the negative experience she received in the restaurant. As a reference, the restaurant is now being monitored by Yelp for any content related to media reports, meaning some reviews have been or would be removed from the business's page on Yelp, but the restaurant has an overall 4.4 star rating from more than 900 Yelpers in March.
Mary went there for a birthday dinner. She claimed that she had a reservation for a party of nine people, but the party waited for two hours before they were finally seated. To make it even worse, because there were three additional people joining the party and the manager was unwilling to work with them, they would have to wait for longer to be seated together or be split up.
She then took the group of 12 people with her to a nearby restaurant, where she and her guests could enjoy a "FABULOUS dinner with EXCEPTIONAL CUSTOMER SERVICE"(in Mary's own words).
Then, the owner of the restaurant exercised his rights of responding to Mary's review on Yelp — for every comment left by a customer, managers are usually allowed to post one response. As a matter of fact, managers are highly recommended to post managerial responses to online reviews because their responses have significant positive impacts on the helpfulness of reviews as well as their business's financial performance.
The owner of the Broadway Oyster Bar pointed out the "real" facts on Yelp, including:
Mary did not have a reservation because the restaurant doesn't take reservations.
The party was waiting for one hour and half, but not two hours.
The party of nine was indeed squishing in a table for eight guests, but that was agreed to by the party.
Shortly after the party was seated, five additional guests (not three) joined the party.
Without asking for any assistance, the party helped themselves by getting more chairs from another part of the restaurant.
When 14 people sitting in a table for eight, some guests were actually sitting in the aisles or right next to other guests.
Because the party had infringed on other guests' personal space and the server found it difficult to serve the party in their current seating situation, the floor manager offered a separate table for those five additional guests, which triggered a fight between a member from the party and the staff, or "a heated argument with F-bombs" in the manager's words.
Some members of the party ended up staying and not going with Mary to another restaurant.
Later, Mary posted another review to respond to the manager's "real" facts:
Some members of her party stayed only because they had already ordered food and wanted to wait to take out their order so that they could join the party afterward in another restaurant.
"The rest of your inaccuracies were not even worth debating."
Now that you have read the reviews from Mary and the manager's response, which side will you take? Who presented the real facts?
More importantly, do you see how critical it is for the owner to respond to Mary's review? In a case like this, managerial responses can provide additional information from the business's perspective, allowing other customers to make an informed purchasing decision with an evaluation of both sides of the story.
In the end, I would like to make the following recommendations for managers who are ready to take an active role in responding to online reviews:
Listen to what customers say about your business, and treat online reviews as customer feedback.
Encourage satisfied customers to post positive reviews and let them be the advocates for the business.
Stay calm when reading negative reviews; do not get emotional.
Focus on the facts, but not how you feel or how the guest felt when writing a response.
When more than one customer brings up the same issue, it is likely that the customer is right.
When the customer is right, acknowledge that and seek ways to address the issue. It is important to show that the management team is listening and working on the issue.
Understand the needs and wants of the target customers. Because different customers are seeking different types of product-service mixes, managers should adopt different tactics in responding to online reviews based on the unique characteristics their product carries.
What else should a manager do in responding to online reviews? What are your suggestions?