Blockchain has been the buzzword for a while. Whether it’s the security systems or the cryptocurrencies, blockchain is one of the underlying technologies. In this article, we focus on the benefits and uses of blockchain for the hospitality industry.
Let’s begin with explaining a little bit about Blockchain. This is how Wikipedia defines Blockchain.
“Blockchain is a growing list of records, called blocks, that are linked using cryptography. Each block contains a cryptographic hash of the previous block, a timestamp and transaction data.”
Simple isn’t it? Well, not at all simple for the hospitality enthusiasts like our team at this Global Hospitality Portal who are trying hard to catch up with technology.
So, let’s try to make it even simpler to help each of the hospitality professionals understand how blockchain is now an integral part of their lives even if they are not aware of it consciously.
To make it simple Blockchain records transaction between two parties in a secure and verifiable way. Now that must be super useful to the hospitality and travel industry as a lot happens between parties in the hospitality industry online.
And now a short video explaining how the blockchain technology is useful for the hospitality and travel industry. Have a look!
Introduction to one of the best technology in the hospitality industry is certainly helping the hospitality industry embrace this concept of blockchain as well.
Blockchain these days is pretty much a basis for a vast variety of applications. Blockchain nowadays can be used to trade any kinds of valuable assets and to store any kinds of data.
The blockchain is capable of changing the hospitality industry as we know it for a few reasons like Transparency, Security and Permanence as already discussed in the video.
Now moving on to the benefits of blockchain for the hospitality and travel industry.
Benefits of Blockchain for the Hospitality Industry
Key benefits of blockchain for any industry per se are below:
The data is near real-time
As you can already understand by now that there can be a lot of benefits of the above in the hospitality and travel industry.
1. Loyalty Programmes
Did you know that customers are sitting on $100 bn worth of unused loyalty points?
Most of the customers in the hospitality industry are either unaware of the loyalty points or are confused about how to redeem them.
Customer loyalty programmes in the hospitality industry are now used by all hospitality businesses but are heavily underused by the customers.
The below video explains how blockchain can help in increasing the conversion of the loyalty points in an effective and secure way.
The advantage of blockchain for the hospitality industry is that now the loyalty points can be clubbed across partners giving a seamless experience to the end-users in a more convenient way.
So you can earn and burn points across partners in the hospitality and travel industry like hotels, Cruises, restaurants, airline, car rentals and more.
Isn’t that a big plus for all hospitality businesses?
2. Distribution in the hospitality industry
There are a lot of advantages of blockchain for the hospitality industry when we consider distribution.
According to the paper by Hospitality Technology Next Generation on HospitalityNet, there is much more than distribution that will benefit from this disruptive technology called Blockchain.
When the franchise owner, exporters, and importers participate in the same blockchain network, details about the products are recorded along with the transactions and can be checked at any point of the supply chain.
3. Identity and Data privacy in the hospitality industry
Blockchain can significantly improve the security of data.
As the blockchain technology gets widely adopted, the necessary information about customers will be available in a secure decentralized database.
4. Secure payments
Credit card fraud and various other data thefts have been troubling a lot of consumers. Blockchain simplifies and secures payment management system.
Integration of database with payment providers and online travel agency has improved tremendously and with wider adoption of blockchain, the security is set to improve multiple folds.
So, customers can make online payments in an easier and more secure manner. Hospitality industry thus becomes a big beneficiary of the blockchain technology due to the humongous number of payments the industry needs to handle both online and offline.
Cryptocurrencies can also be used to settle any or all payment obligations including deposits, advance payments, commissions or any other fees.
5. Tax and accounting
The supply chain can be cumbersome in the hospitality industry. That leads to the addition of multiple layers of taxation thus increasing the headache of the buyers as well as suppliers.
One of the major uses of blockchain for the hospitality and travel industry is integrating these multiple layers of taxation to simplify payments for the payee as well as the payer.
A lot of hospitality organisations are already using technology for account and taxation purposes (if not all of them). Most of these automated software technologies make use of blockchain to ensure security and protection of the data.
The hospitality industry requires a lot of transactions for food, stay, tickets, small bills, tips and more. This requires a complicated and cumbersome accounting and audit process. Blockchain technology has come up as a blessing for the industry as far as accounting, taxation and auditing is concerned.
There are several other benefits of blockchain which are not limited to the hospitality industry alone.
Blockchain can help in revenue management, integrating software, content management, API acceleration, managing and promoting direct bookings and more.
As far as the hospitality industry is concerned, blockchain provides a basis for safe and secure payments, it can improve customer loyalty programs and make the layered and complex supply chain transparent like never before thus benefitting the hospitality industry in multiple ways.
The blockchain technology that has a lot to offer is extremely useful for the hospitality industry.
It makes many time-consuming and cumbersome tasks simpler, saving costs and improving the overall customer experience.