With friends like that who needs enemies. November ’20.

Testbed Vegas - When you have friends like that who needs enemies.

How about Grubhub! When the people who claim to be helping the restaurant industry are fleecing the industry that’s a tough meal to swallow. More about that later.

With all the COVID19 challenges globally the one thing that never slows down is the business of technology. In fact, technology-based business at the big end of town have only thrived through the coronavirus at the macro level of life. Also, in the industry verticals of travel & hospitality. It has been the catalyst of sweeping, albeit in many situations, forced change and we are witnessing an active consideration of the entire shifting of work and home life behavior on the back of technology platforms. This was already in progress, but in some cases the pace has increased.

When the restaurant industry really needed a friend, they found a frenemy at Grubhub!

With all that tech being developed and traditional techhubs being built and priced out, where is the next place for technology to be built? Here are some of the emerging centers around the world that are gaining momentum as technology centers. Testbed Vegas has also advocated that Las Vegas is a natural location for travel & hospitality industry tech. With some of the new work-life changes we think the circumstances have only improved.

All that technology also includes AI and Robotics. Both are anticipated to have marked change on what and how we do things in every industry as we enter Industrial Revolution 4. There are multiple views on the impact of technology on humans as well as the workforce. Regardless it will mean a change in every industry including our own. However, work will continue. It just might look a little different. Some argue it will mean job growth. Others suggest that despite automation and job displacement the hospitality industry will still be an industry where humans have key role to play.

Big tech has been on the receiving end of scrutiny over the last six months and that does not look likely to end any time soon. Travel is one of the key focus areas. More on that later. And yet in the Cloud computing space competition is thriving as late comers to the industry now are bringing their scale to bear. Good news for competition and choice.

What about a look at the future where we own nothing, and the world knows all about us from a behavior and data perspective? In an argument about the dystopian future of a tech-infiltration into every aspect of your life here’s a take on how life might be if that is the path in the future. Confronting. What do you think?

Now for industry. This month Vegas openings, closings and get outs, The Lee Prize winners, building, buying and sustainable hospitality, a Coke, a smile and a hub full of grubs, Marriott and BA get their data fines, Health Passports, travel tech monopolies and the return of the Concorde.

Sustainable hospitality future

Sustainable hospitality  Parkroyal Collection on Pickering
PARKROYAL Collection on Pickering – a model of sustainable hotels

What Coronavirus? In a sign of future confidence in the return to travel norms hotel building continues around the world with China and the Middle East leading the way along with business destination stalwarts New York and London. Is business travel really dead? Starwood Capital anticipates challenges in the shorter term for existing operators and has funds ready to increase their asset holding of hotel real estate as the pandemic continues.

In positive news hospitality sector employment in the US grew with unemployment slipping below 30%. The first time since March. Hopefully, the new wave of COVID19 transmission in the USA will not impact the return to work.

What about OYO? One-time growth leader. One time darling. Then villain. How have they fared during the pandemic and what is the current approach as a result of pandemic impact.

Use technology to your advantage.

The shift to digital brought about through the advent of the COVID19 pandemic has brought to the fore discussions on digital customer journey for hotel and resort guests. Naturally, the conversation has extended beyond traditional electronic products like the guest room to other revenue centers. Traditionally hotels have struggled to bring to the electronic market their other revenue centers. Restaurants, activities, meetings and events and even ancillary services and product offered to the guest. The situation limits the opportunity for revenue growth by decreasing the timeline for sales. Sister company TRAVHOTECH has discussed the mission critical objective of selling the full suite of products and services and the technology environment required to deliver the digital experience. A must have for the future of industry.

Sustainable hospitality continues to be an emerging topic for the industry and technology continues to push new boundaries in possibility for building design and operation. The construction phase and thoughtful physical and operational design make a vast difference to the environmental impact of a building and the business. HICAP, the long running hospitality investment conference awarded their 2020 sustainability design award to The Parkroyal Collection on Pickering in Singapore. Although not a brand new hotel the six years of operation along with the striking environmentally based design prove a model for the sustainable future of hotels.

The dirty Boulevard

Testbed Vegas - Circa Las Vegas
The brand new Circa Las Vegas in downtown Las Vegas.

Deserving of broader international exposure, the Lee Prize winners were announced at G2E. the Lee prize is a competition in conjunction with UNLV offering $1M USD to entrepreneurs tackling the most challenging business problems for travel & hospitality. Some amazing global entrants including homegrown solutions from Las Vegas. Even a company with a solution to provide brand new linen for every guest stay in a sustainable manner. Check out the winners here.

Naturally the numbers are down in Las Vegas as the city continues to contend with the challenges of COVID19 operations. In positive developments Las Vegas announced the ability to host events under COVID conditions of up to 1000 persons providing an initial potential for events to recommence.

Despite these challenges several initiatives continued based upon a positive outlook of the city and a return to travel normal. Caesars The Cromwell announced their reopening as an adults only resort experience. Virgin unveiled their pool experience at the soon to open Virgin Las Vegas. Elon Musk’s Vegas Loop unveiled plans to expand the public transport system including connections to other precincts of the city as well as McCarran Airport.

Downtown, Circa Las Vegas opened its doors as the first brand new property to enter the downtown market in 40 years. You can read more about owner and visionary, Derek Stevens and the story behind the new property. Meanwhile, Vegas stalwart Sheldon Adelson discussed thoughts on selling the Sands Las Vegas interests which include The Venetian and The Palazzo as well as Sands Expo. Prime Las Vegas Blvd integrated resorts. While there was positive news on recommencing events the reality of the lack of weekday business forced multiple operators to plan to close properties from Monday to Thursday including MGM Resorts and Wynn.

In another first, Mohegan Sun the tribal gaming entity best known for their Foxwoods integrated resort in Connecticut became the first tribe to receive approval for a gaming license and operation in Las Vegas. The tribe will manage gaming operations for Virgin Las Vegas when it opens in a few months. Is this the start of a new trend for the city? 

In gambling news, gaming tech global player, Aristocrat received approval for their cashless betting solution. Meaning the customer does not need to revisit the cage to extend credit. It can now be done at the table. More to come on this development. Following the bring the mountain to Mohammed approach in sports betting, some gaming analysts cautioned operators on the challenges with the model based upon international experience.

A fine outcome

The largest data breach in history – Marriott. We’ve heard much about this hack for years now and the penalty that was coming based upon GDPR regulations and the mismanagement of customer information. The ICO announced the penalty to Marriott. Drumroll…….

British Airways who also suffered a data breach in a similar timeframe received their penalty from the ICO too.

higuard hospitality technology information security

Don’t be the next Marriott data breach.

What to make of this? As the first companies to receive review and penalty under the GDPR ruling the ICO had intended to make an example of the two travel companys. Their initial fines were expected to be far higher. Perhaps a reprieve as a result of the catastrophic impacts of COVID are factored into the revised fines?

Both companies will be licking their wounds and feeling fortunate with the result. You would not want to be the next major corporation fined for a breach. 

Grubs in the Hub

Testbed Vegas - Grubhub fleeces restaurant industry

When an industry really needed a friend, they found a frenemy at Grubhub! It so happens that Grubhub has been found out for essentially hijacking restaurant operators business by loading them onto the food order and delivery platform. As if the commissions were not already bad enough! Scrutiny and fines coming their way along with many low-brow looks from an industry suffering terribly from COVID19.

Speaking of delivery, as popular and necessary as it has become for an industry you have also probably determined through experience that some styles of food really were intended to be eaten fresh and straight from the kitchen. It is funny to consider that if a person were sitting in a restaurant and their food came out slowly, warm and in some cases soggy or less than crisp it would be back to the kitchen. And yet remote dining – think dining at home – has become acceptable along with the impact to the quality of chef’s dishes. Here’s what survives the drive best.

Can you imagine catching a plane without a reservation? Well you will have to imagine because that will never happen. The reason for that is rooted in pricing and demand management as well as customer information. Even if purchasing a fare on the same day this information is required. The business of demand management and pricing is central to airlines success. It’s a perishable product. Like hotel rooms, meeting rooms and…tables in a restaurant. Penny drops. Restaurants need to appreciate the role of information gathering and customer data as the rebound continues. Now is the time to make that change when customers are more sensitive to location and seating. Would you book your favorite seat at your favorite bar if you could? The answer is yes, because it is part of the way you like to experience that location. Reservations will be a path to recovery of a stronger restaurant industry post COVID.

There’s so much new technology rushing into the restaurant market. Much to support COVID operations. More to take a very traditional largely non-tech savvy industry into the world of tech enablement. It is not just about customer facing delivery either. Like any multifaceted business technology has a major role to play in improving the overall operating condition for restaurant and bars. But which ones are right for you? Here’s some of the more recent entrants to the industry.

Testbed Vegas Foodnbevtech Restaurant

Need help finding the right technology for your restaurant or bar?

Remote Coke. Whats that? In the pursuit of the contactless dining experience Coca-Cola has undertaken an innovation program to improve the non-touch drink dispensing experience from the ubiquitous post-mix machine seen in almost every fast food and roadside restaurant or food stop around the world. Order your favorite soda from your phone

Why get into the coffee business. Beyond the insatiable demand for the hot (or cold or flavored or..) beverage the cost of production is relatively low compared to the price that consumers are willing to pay for their fix. Some people drink multiple cups a day. Learn more about the stages and cost of the various stages of coffee production.

100 Flying Kangaroos

Although there is not too much flying going at the moment the Flying Kangaroo turns 100 in November. QANTAS began in outback Australia as an airline to service country residents in two states of Australia. One of the oldest commercial airlines it grew to become one of the world’s safest most recognized airlines and brands. If you know what the name (an acronym) stands for you are a real airline aficionado. What a year for a birthday!

Homegrown low-cost carrier, Allegiant continues to battle through the COVID19 storm. Although with the slow return of leisure travel and the short term market expectation for travelers to take domestic holidays Allegiant is bullish about the future. For several years they have been the most profitable airline in the USA.

Continuing on the topic of low cost carriers another of the early status, Air Asia is looking to pivot into other markets. COVID in Asia has been on the wane for longer than other markets and some traffic has been able to resume. However Tony Fernandez believes there is an opportunity for the company as a digital marketplace. Airlines and food? An interesting combination!

Supersonic Airlining! The Concorde has come and gone for almost 20 years now. New development in the space race sees a Concorde type 2 experience where supersonic aircraft will be able to cross the Atlantic in half the time of the original Concorde. It’s early days, but with the rapid development of high altitude/low orbit aircraft who can doubt that one day the experience will return.

A health passport to stay for work

Testbed Vegas - Health Passport

Earlier on in the pandemic we had discussed the potential of health-based passports and sharing information across borders as a possible road to the commencement of travel. As time has passed and the pandemic has drawn out e-passports for health status have become a desired approach. Could there be global cooperation on such a level? We have our doubts but it will begin in certain markets.

Once there was a concept called business travel. Of more recent times business travel started to merge with leisure travel. The circumstance where business would be combined with leisure or as the new term has been coined – Bleisure. Pre-pandemic Bleisure was viewed as a growing market for the traditional business traveler turning necessary business into experience-based pleasure. As a further step now, travel is morphing into stay for work. Have a look at Coconat who is turning the concept into traveling for the purpose of staying for self-driven work as a business model.

What to do when your industry is for the short term out of business? Aircraft get parked on unused runways. Cruise Ships get sent to be cut down for scrap iron. With the industry at a complete standstill globally the value of fleet is greater being sold for scrap and the demand for the services is on the increase.

The AirBNB IPO is approaching and is expected to be another massive value public launch to the share market and share value. What is AirBNB? An accommodation company or an online travel agent or a rental management platform? Depending upon who you ask there are multiple views. Scot Galloway takes a thoughtful look at the touted value of AirBNB vs. the reality of what they really do as a business. Our take – an OTA for holiday rentals which can be replicated.

In Europe as in America big tech is under scrutiny. Booking Holdings and Google are currently earning the wrath of the European Union due to perceived monopolistic practices. Are they monopolies? We would say in some ways yes, but not because of anything specific they have done. Is Google really in travel specifically any more than any other business vertical? Do they actually compete with each other? An OTA and a search engine. Two different businesses. Monopolies? For the time being maybe. But probably not forever as there is always room for competition. The question for us is who knows most about the traveler?

The development between Google and Sabre may change that position. Sabre is clearly rooted in the business of travel booking and has the platform and the B2B customers that combine search power with booking platforms. That is one to watch for the future given the airline, hotel and travel agency nature of Sabre’s technology. The question is the future of GDS and NDC technology. A space to watch.

Tripadvisor also made another step into professional travel technology solutions for the B2B market. Tying up with OTA Insight provides the travel opinion leader with the business tools to effectively manage reputation along with product through their booking channels. On the back of steps in the tour space the company is making some positive moves to get closer to industry.

One thing is for sure. We will all travel again in some way and in some capacity. What should you do in 2021? Here are some thoughts from the travel agency community on what could be are realistic travel planning expectation in the coming year.

Virtual Escapism – Japan

Now for your travel fix. We know that it’s hard for us to go anywhere, at least outside the country. Let’s take a digital journey to Nihon. The nation of Japan. Ancient, cultured, Zen like and yet modern, quirky and unique in culture and approach. Japan truly is like being on another planet. Visit planet Japan.

What remains for the rest of the year in travel & hospitality? It’s already been so eventful that we are certain it’s not finished yet. There will be more to come between now and the end of the year wrap up. As COVID cases are on the rise look after yourselves. We look forward to being able to reconnect in person soon.

Can you believe that the year is almost over? A memorable year for all the wrong reasons.

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