ONLINE RESERVATION SYSTEM IN THE HOSPITALITY INDUSTRY – Term Paper

Objectives

The digital economy is critical to future trends of the world economy. It will be a driver of growth and productivity. It will change what skills remain competitive and patterns of development. Again, it will accelerate globalization, increase competition, and remove barriers to entry into the international marketplace. In fact, digital innovation will not only adopt new technologies with a transformative impact on the future of the business but also later the industry structure and supply chains. Additionally, they will shake up business structures and change the very nature of work for employees. Tourism and hospitality digital age looks at the phenomenon of hospitality in a systematic way. It comprises a scientific approach to the study and representation of reality through the coherence of technology and interdisciplinary work (Phillips, Barnes, Zigan and Schegg 2016, p. 24). Tourism and hospitality indicators in the digital age are destination web monitor as well as hotels of the future. Interestingly, the digital age continues to transform tourism and hospitality globally. It has significantly changed the best professional, managerial, and strategic approaches in the industry. E-tourism provides the scope for the development of an adequate range of new approaches, systems, as well as techniques to facilitate global interaction among industry stakeholders around the world. That forms the primary basis of the advancement, and it provides a competitive edge for the SMEs since they could acquire the same market as large corporations. That is fair to some extent since every individual needs an equal share of the factors of production. It is upon such small businesses to utilize the opportunity and compete favourably. That will promote their growth as well as expansion in the global market.

Introduction

Online hotel reservation is becoming a very common method for booking hotel rooms. Travellers can book hotel rooms from home using online security to protect their privacy as well as financial information and using several online travel agents to compare prices and facilities at different hotels. The benefits of using global distribution channel are that they provide a single database from which all reservations sources draw immediate room availability and room rates. Earlier travellers contacted hotels directly or used a travel agency to make a room reservation. Nowadays, a traveller can make reservations on hotel websites that give them pictures and virtual tours to make their choices. Room tariffs exist on the internet site along with deals and discounts. Non-franchise hotels require a booking engine application to link to their website. That permits persons to make an online reservation (Phillips, Barnes, Zigan and Schegg 2016, p. 34). Travel agents have access to these websites and may even confirm room reservation directly. There are also sites that specialize in searches for the best deals. Hotels have the challenge of maintaining right room inventories as well as rates.

Large hotel chains typically have a direct connection to the airline global distribution systems that in turn provide hotel information to the hundreds of travel agents who subscribe to these systems. Individual hotels and small hotel chains may not afford the cost of a subscription to the GDSs and rely on other companies to provide the connection. Several large online travel sites are in effect travel agencies. Hotels send their information downstream to travel agent websites and give commission to those officers who made reservations from travellers who connect to their website. The use of several distribution channels ensures full occupancy. In such cases, individual agreements and tariff structures negotiate with each distribution channel. Nowadays, it is imperative for hotels to integrate with all supply channels so that their guests can make an accurate online booking.

Background

Information systems are computerized systems, which contain hardware, software, users, data, processes, as well as procedures that work together to produce meaningful information to assist the operation and management of an organization. The concept accepts raw data as inputs and then converts these data into useful information as output. Additionally, users get specific instructions to follow to accomplish an activity. An information system supports both short-term and long-term activities for users in an organization. Managers can receive the updated information about their business through different types of reports generated by the system.

In hospitality, information systems can streamline the process of data collection, arrangement, as well as presentation (Hua 2016, p. 28). That, in turn, assists hotel managers to plan, organize, direct, and control operations. Additionally, such systems support managers at different levels, including strategic, tactical, and operational, of decision-making activities in an organization. That result to the provision of operational efficiency and cost reduction. Most importantly, better customer service leads to a gain of competitive edge, as the guest encounter is a crucial factor to guest satisfaction in hospitality. In many hotels, the role of information system departments already goes beyond the mere provision of technology support. These units now offer advice to hotel management on how to adopt appropriate technologies to achieve business goals as well as objectives.

Literature Review

The development of the internet, ICT, social media, as well as online travel agencies reshapes the way people plan for, buy, and use tourist products and services (Piccoli, Lui and Grün 2017, p. 32). The role of traditional tourism intermediaries suffers a lot due to such interventions. That explains the popularity, among both researchers as well as practitioners, of the disintermediation hypothesis. That focus on the idea that intermediaries will sink within the distribution channel. The emergence of new e-intermediaries draws an increasing attention to what became evident as reintermediation as well as cybermediation. The phenomenon relates to the utilization of ICT and internet tools for developing new intermediaries, or for enabling existing brokers to re-design tourism distribution channel. The system currently exerts a pivotal role in influencing consumers’ decision-making since they intermediate an appropriate amount of hotel reservations. Such influences tourists’ choices from the early stages of their information search. Hence, an early stage that leads to assess of the sites affects the consumer decision. For example, Mellinas et al. (2016, p. 12) reported that the majority of online travel shopper visits the websites, but 50 percent then turn to service providers to make their bookings.  

The primary factor that influences travellers’ choice of information search includes personal characteristics, situational characteristics, product characteristics, travel party, as well as the presence of friends and relatives at the destination. Based on their internet usage, tourists have different classifications. The most common one is lookers. It consists of an individual who only wishes to acquire information online. Again, bookers are the persons who look and buy tourism services and products. According to (Kim, Kim and Heo 2016, p. 28), lookers differ from bookers in their socio-demographic characteristics and their history of internet usage. That is inclusive of the number of years they have used the internet as well as the number of hours they consume on the web per day. For example, it is evident that the propensity to purchase online increase with age, education as well as the level of income. Therefore, younger groups are less likely than senior groups to prefer travel agents when searching for information, and travellers overs 59 years and on an organized tour to be more liable to choose the combination of travel agents and face-to-face communication.

List of References

Hua, N., 2016. E-commerce performance in hospitality and tourism. International Journal of Contemporary Hospitality Management, 28(9).

Kim, B., Kim, S. and Heo, C.Y., 2016. Analysis of satisfiers and dissatisfiers in online hotel reviews on social media. International Journal of Contemporary Hospitality Management, 28(9).

Mellinas, J.P., María-Dolores, S.M.M. and García, J.J.B., 2016. Effects of the Booking. com scoring system. Tourism Management, 57, pp.1-83.

Phillips, P., Barnes, S., Zigan, K. and Schegg, R., 2016. Understanding the Impact of Online Reviews on Hotel Performance An Empirical Analysis. Journal of Travel Research, p.0047287516636481.

Piccoli, G., Lui, T.W. and Grün, B., 2017. The impact of IT-enabled customer service systems on service personalization, customer service perceptions, and hotel performance. Tourism Management, 59, pp.1-362.