the hospitality industry gamechanger?...the initial challenge faced by businesses of any size on...

big data: the hospitality industry gamechanger?

AN INSIGHT REPORT FROM WILLIAM MURRAY AND ZIZO

Over the last few years, data science or ‘big data’, has become widely valued and utilised in the

technology, finance and retail industries. However, in the hospitality sector, I think we’ve only

scratched the surface in knowing exactly what gathering and understanding our data can do for

our businesses. By gaining valuable insight, hospitality businesses of any size are better equipped

to make informed decisions, using data to improve efficiency, build customer loyalty, predict

behaviours and increase profits.

We teamed up with data analytics provider Zizo to host a hospitality industry roundtable,

Big Data: The Gamechanger at The Foodservice Show 2019. Industry experts within the hotel,

drinks, foodservice, purchasing, food waste and software development sectors engaged in a

varied discussion about the power of big data in hospitality.

Anita MurrayCEO, William Murray PR & Marketing

big data: the hospitality industry gamechanger?

AN INSIGHT REPORT FROM WILLIAM MURRAY AND ZIZO

William Murray | @WilliamMurrayPR

What’s your view? How can #bigdata help

#hospitality businesses to personalise customer

experiences? @BarsysCocktail @TomMessett @

FoodServShow http://bit.ly/2suuxKW

#foodindustry #foodservice

Tim Groves | @nfum_TG

Aaron Jennings | @nfum_Aaron

Wow! A fantastic round table discussion

hosted by @WilliamMurrayPR and Zizo,

great to hear views from industry leaders

around how big data can help food & drink

businesses evolve. A key learning point,

understand the outcome you want to

achieve. #FoodServShow @FoodServShow

Great first day @FoodServShow. The highlight

was being involved in the Big Data round table

and discussing the opportunities with data for

hospitality and food and drink businesses. Thanks

@WilliamMurrayPR @TomMessett @nfum_Aaron

Drawing upon these discussions, this report

considers the most valuable types of data for

hospitality businesses, the challenges and

benefits to using your data, and whether the

hospitality industry is ready to evolve with it.

3

WHAT IS BIG DATA?

A relatively recent term, a data lake

describes a large database where data of

all types can be ingested for analysis at a

later date. A big data solution, still

unproven in terms of value delivered.

Data analytics is the discovery,

interpretation, and communication of

meaningful patterns in data and applying

those patterns towards effective

decision making.

A data silo is data that is held separately

from other data, for instance by an

application or a department within a

business. The aim is to break down data

silos to get a holistic view of data across

a business.

THE JARGON BUSTER

When you’re dealing with complex information or processes, jargon has a habit of taking over.

Here are some big data buzzwords and what they really mean.

Data Analytics

Data Silo Data Lake

A data set is an element of data,

normally from an individual system

or application, that describes

something specific.

Data Sets

The hospitality industry has a somewhat laggard reputation when it comes to adopting technology. So, for many, the concept of ‘big data’ is a daunting and confusing one to understand, let alone act upon. So, where do businesses even begin?

We asked our roundtable guests to sum up what big data means to them...

“For me, big data is the sea of data that surrounds everything we do that we may

not actively be aware of, but put together, with the right questions and direction, can

generate interesting insights that could be beneficial for many fields.”

Samantha Lai, commercial officer, FareShare

“For me, big data means a couple of things. I believe it is a new data culture by

businesses and individuals that combining data from multiple sources can lead to

better decisions. It could also mean the more data you have the more insights

available to you. Automatically solving a problem.”

Aaron Jennings, commercial risk consultant, NFU Mutual

“My interpretation of big data is information that’s gathered and can potentially be

used to improve the business. This data can be from existing customers or it can be

from outside sources such as the internet and online platforms. The idea is to learn

and understand the customer better to allow more effective business decisions.”

Tim Groves, commercial risk consultant, NFU Mutual

“The fascinating thing is you can hear a hundred definitions of big data, and they could all be absolutely correct. The concept is simple, but there are so many ways to explain big data and how it can be used! Essentially, data is just data until you wrap context around it. The biggest challenge is pulling it together, it’s simply just numbers until you say what you can learn from it.”

5

-

Matt Napleton, sales and marketing director, Zizo

What foods are often thrown

away unused? What foods are often in demand?

Tackling food waste is a growing concern. Throwing away

surplus food is no good for the planet, nor is it ethically sound

when worldwide hunger remains a significant problem.

Supply & Demand

WHAT TYPES OF DATA ARE IMPORTANT TO HOSPITALITY BUSINESSES?

The information you have and what you can do with it depends on the type of business you are, and what sector you’re operating in. So, what kinds of data are useful for hospitality businesses to analyse?

IS THE HOSPITALITY INDUSTRY READY? Is the industry ready to become data driven? We asked our expert guests.

“As an analogy, some people compare data to oil. For oil to be useful, you have to refine it and have an engine. For data to be useful, you have to collect it, refine it and also have some kind of ‘engine’ such as marketing to make it work. The problem is that very few people in retail, food, leisure and other spaces are collecting this data, never mind knowing how to refine it.”

Tom Messett, founder, Stampapp

“When the internet first came around, you had to have the people coming in breaking the doors down before anyone else could come in and discover the amazing benefits. The hospitality industry doesn’t currently have the people in place to do this.”

Tim Butler, director, Store Performance

“Some businesses don’t know where to begin, what is out there, or what they could do with the data they have. Some don’t even know what data they have.”

Rodney Hoinkes, chief insights and innovation officer, Fresh Montgomery

“Analysing and understanding data is completely alien to some small business owners. For them, the investment decision is ‘do I buy a new cooker?’ or ‘shall I

invest in physical technology?’ instead of systems they don’t understand.”

Christoph Haschka, CEO, The Food Solutions Group

7

useful for... hotels, cafés

& restaurants

Top days/times of visit

Booking Details

How customers are booking -

mobile device, PC, etc.

Popular times and days of booking/

ordering

Not to forget... OTHER

COMPANIES’ DATA!

Your data is your intellectual property, but what could be gained from

sharing it? Many businesses are keen to keep their information close to

their chests to avoid competitors gaining an advantage. Sharing customer

insights could in fact benefit your business and the hospitality industry as

a whole, leading to fruitful business partnerships and synergies.

useful for... wholesalers, f&b suppliers, restaurants, caterers

Gathering this information for a

customer base of any size allows you to

highlight trends and tailor your marketing.

Does a particular product or service appeal

to a specific age range?

How many customers only spend when a

promotional deal is running? Using this

information can help you understand

different customer groups, tailor your

communication with them and

ultimately increase profits.

useful for... hotels, cafés, restaurants, f&b suppliers, wholesalers, caterers

Average time to conversion

Order combinations

Average spend

Top menu items

Purchase History

Uptake of deals & promotions

Most bought products

Loyalty

Customer Profiles

Age

Average spend per

month

Gender

data from wholesalers, f&b suppliers/producers, hotels, restaurants and cafés, pubs and bars, etc.

THE CHALLENGES IN BECOMING DATA DRIVEN Return on Investment

The group debated some of the challenges associated with retrieving, understanding and acting upon our data. These included...

Technical Understanding The initial challenge faced by businesses of any size on their journey to data success. Deciphering

different sets of data, contextualising results, understanding patterns and predicting future behaviours

from it proves extremely difficult. For businesses without dedicated analytics teams or external

support, it can seem impossible.

“One problem I have with the term ‘big data’ is that it’s scary.

A small franchise or coffee shop wouldn’t get it. If you put

it in more personable terms, asking what their customers

are buying and when they’re buying, people understand it.

Then, even a one or two man businesses could use data to do

something really useful.”


Data Silos Lack of transparency across a business isn’t helpful for anyone, especially when it comes to data.

Information held by one department could be useful for another, but if they don’t know it exists,

the opportunity is lost.

Most companies analyse just 12%

of their data*

“There’s nervousness around it. The issue is that businesses aren’t sure what the return on investment

might be. It can depend on business size, ROI for a large company might be significant, but for smaller

companies, it could be very different.”


Analysing your data in-house or with external support requires investment of time and

money. Some businesses are concerned they may not get back what they put in.

*Rackspace 2018

“Hospitality businesses should be considering how they bring different sets of data from the different sides of their business to make them work effectively together.” Matt Napleton, sales and marketing director, Zizo

Tom Messett and Rodney Hoinkes used hotels as an

example of this. Hotels and their in-house restaurants

use content management systems such as

booking.com or Expedia to organise bookings.

The problem is they are not aligned together, prevent-

ing the business from understanding the

customer’s accommodation and

dining preferences.

Diana Spellman, managing director, Partners in Purchasing, also

highlighted the struggle for buyers to choose the right analytics

provider or solution for them.

“One issue is that there’s a minefield of data analytics

companies to choose from, and a naivety from businesses about

the services they’re buying. Businesses have to take a huge leap

of faith when investing in analytics support, despite low levels of

information, budgets to consider, and the time it takes to train

people to understand and use that data.”

12%

*Rackspace 2018

98

WHERE TO START

Small Steps52% of businesses have to break down their

data into small pieces just to work with it.*

What can any business do to overcome data challenges and make themselves data ready?

Build Transparency Making information available across a

business gives different departments a

bird’s eye view. A comprehensive picture of

what’s working, what isn’t working and the

opportunities for growth.

“You have to make sure the systems you’re

implementing are open – if you have closed

systems you’re going to have problems.

Data has to be accessible. In most places

you need a couple years of data to make

use of it properly.”


“By making a series of small steps, your risk of a misstep is much smaller. This way, you can correct issues or mistakes much more

quickly than if you bring in a hundred things at once.”


“Engage your business with small actions and get people thinking about data more often. If you have a challenge within your business, consider whether data can help form a solution. Or work to identify gaps within your data and act upon that. Once you have the information that’s relevant, you can start building a picture of that data. Then, you’re getting to a data driven state.” Matt Napleton, sales and marketing director, Zizo

“The challenge I’m currently facing is we need to understand and look into data in small steps. We need to be dedicated to understanding the journey.”Christoph Haschka, CEO, The Food Solutions Group

*Rackspace, 2018

The entire group agreed that taking small steps

to understand, analyse and act upon patterns

in data is most effective.

*https://www.gartner.com/smarterwithgartner/treating-information-as-an-asset/

“The CDO is a role coming a lot more to the core of businesses recently, not just thinking about

the data that business uses for itself but how it shares with other people is important.”


Talking of external support, Matt Napleton also explained that data analytics support doesn’t

necessarily require a large upfront investment. Analytics companies now offer tailored

pay-per-use services, offering flexibility for tighter budgets.

“How is the hospitality industry going to thrive if it isn’t going to take data seriously?

We need people in there at board level who care and understand.”

Anita Murray, CEO, William Murray PR & Marketing

Expertise Getting the right people to lead data driven

projects forward is essential, whether they are

internal or external to the business. Break down their

data to work with it

52%

Gartner estimates that by 2020,

50% of leading organisations

will have a chief data officer

(CDO) with similar levels of

strategy influence and

authority as a CIO.*

52%

1110

BENEFITS AND OUTCOMES

Avoid food waste with intelligent planning

“Being able to predict when, what and how much food is going to come will allow us to match up

the demand much more effectively. At the moment we just get surplus food. For us, being able to

proactively manage what food is going to come down the pipeline will really help. Having more

transparency ahead of time from food companies – knowing where in the supply chain their

food isn’t going to sell and will therefore go to charity – will make the process

much more efficient.”

Samantha Lai, commercial officer, FareShare

in consumer manufacturing, retail and distribution think

data will be ‘very’ or ‘critically’ important to their future success.*

Now you’ve got the data and understand what it’s telling you, how can you use this information to your advantage? In other words, what are the potential business benefits of utilising your data?

72% of executives

More efficient processes

Tailored customer communication > higher conversion rates

Improved customer acquisition and retention processes

Precisely control stock and ordering

Identify issues in real time

Product development insights

Better understanding of risks

*Top of Mind Survey, KPMG International and The Consumer Goods Forum

Predict and plan for future behaviour and events

“Efficiency is a key focus. We’ve evaluated what we can do to help exhibitors be more successful at our shows, looking at what works better for them. You’ll see the people who act upon this data are 10-15% more successful at our shows.”

- Rodney Hoinkes, chief insights and innovation officer, Fresh Montgomery

1312

USING DATANo matter how much information you hold and expertise you have, you can use data to your advantage.

15

“Any business can use data but they have to be

realistic. A one man band coffee shop is never

going to do detailed forecasting, but what they

can do is have customers log in to an app and

give their date of birth, for example. Build loyalty

in simple ways, understanding gender split or

ages of customers.”


increase footfall loyalty schemes,

birthday promotions

trial in-demand products

(e.g. oat milk, coconut milk, vegan cakes)

The Small Businesse.g. Independent coffee shop

predict stock levels order 20% more

coffee in January

PERFORMANCE

Zizo was able to perform 20 complex queries in

the same time as the current data warehouse

infrastructure took to perform one query.

RETURN ON INVESTMENT

Zizo was able to prove significant savings in both

hardware and software. In fact, the proof of concept

(POC) was delivered on a single ‘off the shelf’ server

costing under £20,000.

Improving sales performance across a global organisation through the delivery of right on time analytics

A major British multinational retailer with 700+

stores in the United Kingdom, 300+ stores in more

than 40 countries and an annual turnover

approaching £10bn, is currently benefitting from

Zizo software. The analytical platform delivered to

our client is the only online means by which they can

measure revenues across the entire business by year,

month, week, day and by hour, 24x7.

CHALLENGE

To improve store and stock performance analytics to

deliver performance improvements whilst delivering

significant and rapid return on investment.

SOLUTION

With the Zizo service, our client was able to gain

insights from near real time and historic sales data

to understand performance across the business.

The solution has over 7,000 users, is updated every

15 minutes and is delivered to desktop, iPhone and

iPad – with analysis on billions of rows of data.

BENEFITS

Improved reporting and analytics across all management levels of the business, globally

Solution has been delivered on hardware costing under £30,000, generating cost savings across IT

Analytics enables a more accurate understanding of store performance

build customer loyalty follow-up emails, direct marketing

The Large Business e.g. Hotel chain

upsell services spa offers, restaurant

vouchersmore accurate

ordering & logistics order 30% more drinks

in summer months

increase occupancy introduce mid-week

offers

ZIZO CASE STUDY

1514

The group debated some of the challenges associated with retrieving, understanding and acting upon our data. These included...

Air France alone has compiled vast datasets

containing online search histories, completed

bookings and even airport lounge activities on

every one of their customers – more than 90

million of them. The data helps officials create

personalised travel experiences for their

frequent guests.

Yield management. Big data analytics also

affects yield management. By calculating the

optimum value of each room and factoring in

metrics like seasonal demands, regular guests

and similar trends, hotels can ensure

maximum profits.

Regardless of whether hotels are trying to

classify their patrons with better accuracy,

provide personalized services, engage their

social media audience or stretch the value of

their properties, they must use and apply all

this data before it has an impact. The

information on its own is dormant until

activated through the disciplines of big data

processing and analysis.

Descriptive, predictive, and prescriptive analytics

Descriptive analytics. Used to glean data from

past occurrences and activities – is commonly

seen in industries like marketing and

advertising. Predictive analytics uses big data

to try and forecast future outcomes or events,

while prescriptive analytics takes advantage

of highly advanced algorithms to process big

data and provide actionable advice. All three

of these methods are common strategies for

applying big data in the hotel and

hospitality industry.

Descriptive analytics. This method is one of

the most straightforward and efficient ways of

generating actionable data. Did a recent

renovation increase sales, or was it ultimately a

waste of capital? It’s easy to answer questions like

this via descriptive analytics – it’s a decades-old

method that has assumed many different forms

over the years.

Predictive analytics. Basic examples of predictive

analytics include preparing a hotel for a seasonal

rush – like spring break – and reducing the hours

of staff members to accommodate the fewer

number of reservations in the offseason.

Prescriptive analytics. Instead of letting the

human workforce interpret and act on this

information without any guidance, some of

today’s systems provide recommendations and

advice to improve service and increase profits.

Online reservation systems that track a guest’s

past stays can automatically generate discount

codes for future reservations, assemble

personalised services for each guest and even

deliver their favourite drinks or food.

Big data analytics has the potential to completely

transform the customer experience within the

hotel and hospitality industry. It’s not something

that will happen overnight, but the industry is

already making huge strides toward a full-on

embrace of big data and all the advantages it

has to offer.

Some of the most tech-savvy hotel chains are

already adopting long-term strategies and policies

for big data management. Those who are

unwilling – or hesitant – might find it hard to

compete in the coming years.

The future of big dataThe niche of big data is still in its infancy, but it’s

already sparked storms of creativity and

innovation in any industry it’s touched, including

hotels and hospitality. Even the most

sophisticated of predictive analytics can’t tell us

exactly where big data is headed, but customers

are sure to be pleased with the results.1716

What is big data?

The term big data means many different things

to different people. Generally speaking, it

describes the collection of information – from

both offline and online sources – to support the

ongoing development and operations of a

company or organisation.

Data can originate from almost anywhere,

including everything from historical records,

point-of-sale devices and current consumer

habits to customer feedback, referrals and online

reviews. With so much information coming from

all directions, it’s tough to rein it all in and apply

it a useful way – but that’s where the discipline of

big data analytics comes into play.

It’s crucial to define big data when trying to

understand its role in hotel and hospitality. With

so many companies embracing big data and

applying it to improve their operations, it might

be the key to maintaining competitiveness in

the future.

How does it apply to the industry?

Big data has relevant applications in nearly every

industry imaginable. To use this information to its

fullest extent, it’s important to know where it has

the greatest impact.

THE FINAL WORD: CONTRIBUTOR ARTICLE The role of big data in the hospitality industryConvert complex data into actionable analytics to realize its potential by NATHAN SYKESCredit: Today’s Hotelier – www.todayshotelier.com

Customer categorisation. One of the keys to

maximizing profits – regardless of industry – is

in the categorization and identification of

incoming customers. Most experienced sales

reps can gain a basic understanding of a

customer’s spending habits in as little as one

visit, but even this can be misleading. To

properly categorize a customer according to

their potential for profitability, for example,

proactive companies must track customer

spending habits over time.

Personalized service. More companies are

offering customized services to cater to their

most valuable customers – either in groups or

as individuals. But hotels can’t always rely on

internal data to predict a customer’s return.

Instead, data analysts have to collect data from

surrounding, external sources to help

identify travel patterns, habits and

common timeframes.

Social media. In today’s Internet-centric age,

online communities are just as important as

their traditional counterparts. Since many

customers turn to social media for questions,

issues and concerns, the platform provides a

great opportunity to connect with consumers

in brand-new ways.

“With so much information coming from all directions, it’s tough to rein it all in and apply it a useful way.”

Big data is taking the world by storm. Make no mistake – it’s not just for the IT industry. While there are numerous forms of sophisticated technologies used in the field of big data analytics, the results of this data are usable in nearly every profession – including the hotel and hospitality industry.

Enabling big data analytics for everyone

Zizo as a business is a unique combination of award winning technology,

processes and people that deliver data driven solutions to businesses of any scale, in a

time frame and at a cost that no-one else can match. Zizo focus on delivering the value

found within data, whether it be experience, platform or commercial value.

“The roundtable brought together a wide spectrum of organisations from the industry, with data creators

engaging with data consumers to understand how we can pull data together to create new opportunities.

As we have seen in other sectors (such as retail, logistics and finance in particular) the ability to pull

together diverse data sets into something that delivers value will be key for future growth, of both wallet

share and consumer voice. Even if you feel you are not ready to use data yet – you would be best to start

thinking about new ways to use it – before somebody else does!”

“It is clear that despite some initial reticence about data and its value to the hospitality business,

the volume and variety of data created by the industry means there is clear value to be had.

Zizo was created with the specific purpose of changing the analytics business.

Through an in-depth understanding of this complex market, and the even more complex solutions

and technologies that live within it, we knew that there was an opportunity to re-invent the way

organisations use data to drive real business outcomes.

As innovators and data experts we decided to leverage our knowledge and create a

new solution, one that allowed organisations of any size to become truly data driven,

one that scales from the data centre to the edge.

www.zizo.co.uk


19

*https://www.gartner.com/smarterwith-

gartner/treating-information-as-an-asset/

Data has become an increasingly valuable asset for

businesses to capitalise on – and in creative ways

too. The key is to understand and contextualise your

data, using it to make informed decisions.

By 2020, Gartner predicts that 10% of organisations

will have a highly profitable business unit

specifically for productising and commercialising

their information assets.*

The hospitality industry remains behind others in

adopting progressive technologies. But the rewards

to reap are plentiful. From small enterprises to large

chains, the first step is to build a picture of what

your data is telling you, and then work to a data

driven state with these insights.

WHAT NEXT?

18

THE FOOD & DRINK SPECIALISTS

When brands are all doing similar things, it can be difficult to stand out.

That’s where we come in. We’re a creative PR and marketing agency that

specialises in food, drink & hospitality. We use our knowledge to deliver

integrated campaigns that get commercial results.

W I L L I A M M U R R A Y . C O . U K

@WilliamMurrayPR @WilliamMurrayCommunicationsWilliam Murray PR & Marketing

T. +44 (0)20 8256 1360 | E. [email protected]

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