Mobile Geo-Targeting Makes 'Just in Time' a Reality for Hotels

By Jared Simon Chief Operating Officer, HotelTonight | January 28, 2018

In the 1960s and 1970s, Toyota revolutionized supply chain management when it perfected the just-in-time (JIT) model. Now more widely known as "lean manufacturing," the JIT model reduces costs and waste because manufacturers only order supplies as customers place orders. Before JIT, manufacturers would stockpile the goods they needed to make cars at the expense of ordering it in bulk up front and finding places to house it.

JIT proved revolutionary at the time not only because of the savings and efficiencies it generated, but also because its successful execution meant seamless coordination between customers, manufacturers, and suppliers. It took nearly fifteen years to perfect, but once Toyota was able to prove its effectiveness, companies across the globe started to adopt it as the standard.

Because of static supply, hoteliers haven't had the opportunities to generate those same kinds of lean efficiencies. It would be nice to scale rooms up and down to exactly match unpredictable demand, but without bending the laws of physics, that's out of the picture. While hoteliers have explored different pricing and placement models to fill vacancies, the average hotel occupancy rate still hovers near 65%-even with the proliferation of more easily accessible sales through online travel agents (OTAs).

Today, the widespread use of mobile applications and the effectiveness of mobile targeting is giving hoteliers the chance to generate their own lean efficiencies and more effectively pair demand with supply. By layering clever and forward-thinking marketing tactics on top of mobile targeting, enterprising hoteliers can better reach customers to fill last-minute vacancies without cannibalizing their best bookers or cutting into their rate strategy and diminishing overall ADRs.

If it's done right, this just might be the hotel industry's own revolutionary JIT moment.

What is Mobile Geo-Targeting and Why Does it Matter?

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Coming up in December 2018...

Hotel Law: New Administration - New Policies

In a business as large as a hotel and in a field as broad as the law, there are innumerable legal issues which affect every area of a hotel's operation. For a hotel, the primary legal focus includes their restaurant, bar, meeting, convention and spa areas of their business, as well as employee relations. Hotels are also expected to protect their guests from criminal harm and to ensure the confidentiality of their personal identity information. These are a few of the daily legal matters hotels are concerned with, but on a national scale, there are also a number of pressing issues that the industry at large must address. For example, with a new presidential administration, there could be new policies on minimum wage and overtime rules, and a revised standard for determining joint employer status. There could also be legal issues surrounding new immigration policies like the H-2B guest-worker program (used by some hotels and resorts for seasonal staffing), as well as the uncertain legal status of some employees who fall under the DACA program. There are also major legal implications surrounding the online gaming industry. With the growing popularity of internet gambling and daily fantasy sports betting, more traditional resort casinos are also seeking the legal right to offer online gambling. Finally, the legal status of home-sharing companies like Airbnb continues to make news. Local jurisdictions are still trying to determine how to regulate the short-term apartment rental market, and the outcome will have consequences for the hotel industry. The December issue of Hotel Business Review will examine these and other critical issues pertaining to hotel law and how some companies are adapting to them.