Blockchain is set to become one of the most exciting and impactful technological innovations over the coming decade, and its utility has the potential to revolutionize hospitality as we know it.
While the emergence of blockchain is closely linked to the cryptocurrency landscape, its applications can extend well beyond digital currencies, with capabilities that can form a platform to bring better efficiency and security to hospitality firms.
The global blockchain market is expected to grow from a value of $20.1 billion in 2024 to $248.9 billion by 2029, representing an impressive CAGR of 65.5% over the coming five years.
In the travel and hospitality sector, blockchain can be utilized for many different purposes to transform customer loyalty, customer verification, fraud prevention, payment efficiency, and wider security measures. With this in mind, let’s take a deeper look at exactly how the technology is transforming an industry that’s ripe for innovation:
Delivering on Transparency
Hospitality businesses can rely on the greater transparency and trust offered by blockchain systems due to their status as an immutable decentralized ledger.
Crucially for customers, this means that data can be securely stored without the need for intermediaries or the threat of unauthorized third parties accessing their personal information.
For hotels, restaurants, gyms, cafes, and other areas of hospitality alike, visitors can rest assured that their information is safe and secure when sharing their data with hospitality firms.
Leveling-Up Loyalty
Churn is a serious challenge for many hospitality firms, and developing truly transformative loyalty schemes can be key to retaining customers. Blockchain technology has the potential to enhance the quality offered by loyalty schemes through the issuance of digital tokens that can be redeemed for a variety of benefits.
From accessing special offers, unlocking exclusive services, redeeming merchandise, claiming freebies, and sampling new services, blockchain can help hospitality firms personalize their rewards, get more creative, and limit instances of loyalty scheme fraud with the help of blockchain.
One example of this can be found in Trippki’s use of blockchain in its loyalty reward system. The hotel firm utilizes its own digital ‘TRIP’ tokens that are recorded on the blockchain, which can be redeemed for future visitors or exchanged for cash. The tokens have no expiration date and can be earned through stays or by using amenities.
Frictionless Payments
Blockchain also has the ability to simplify payment processes for hospitality firms. This can pave the way for quicker, more secure transactions.
Particularly in the hotel industry, as well as businesses that frequently welcome international visitors, blockchain offers greater payment flexibility for customers that can include cryptocurrency as part of its capabilities.
With integrated point-of-sale (POS) systems, expanding into the field of cryptocurrency payments means that customers can pay for services without having to undergo a fiat currency conversion that can be filled with inefficiencies like exchange fees.
Instead, the flexibility of blockchain means that all parties can leverage a transaction on their terms quickly and at a relatively low cost to third parties.
Improved Personalization
The technology can also work alongside artificial intelligence to help convert customer data into hyper-personalized experiences.
When integrated with blockchain, which can securely store customers’ preferences and purchase history, hospitality businesses can provide bespoke services at a vast range of touchpoints.
In the hotel industry, this means personalized room settings, bespoke dining recommendations, and more focused digital local guides. This unity of AI and blockchain helps to offer a level of customization that can resonate with customers on an unprecedented level.
Supply Chain Efficiency
Another transformative impact of blockchain technology is the visibility it can provide to every step of the supply chain for hospitality firms.
With an emphasis on restaurants and hotels, digital ledgers can provide more visibility on supply chains for food, beverages, bed linen, and utility products to ensure quality throughout inventories and that business standards are maintained.
Should food products or materials arrive that are poor quality or faulty, blockchain records can clearly show where the batch came from and when it was delivered for ease of reference. This can help businesses keep better track of their suppliers.
Ultimately, heightened blockchain visibility for supply chains can provide stronger accountability and transparency throughout the procurement process.
Enhanced Security
Because blockchain can store encrypted identity verification information on the ledger, it can offer greater levels of security to hotel guests, for instance.
When booking a room, guests can confirm their identity to the hotel, then provide identification information during the check-in process to help verify their identity to ensure that only valid guests are ever provided access to the site.
Taking Hospitality to New Levels
Blockchain will have a transformative impact on the hospitality landscape, providing new levels of efficiency and security alike.
As technology continues to grow, the ability to personalize customer experiences can help to improve the capabilities of innovative businesses, helping firms to stand out from their industry rivals.
Forward-thinking hospitality businesses can gain more momentum over their competitors by looking at how to accommodate blockchain today for a more sustainable tomorrow.