{"id":1827,"date":"2018-01-16T20:36:00","date_gmt":"2018-01-16T20:36:00","guid":{"rendered":"https:\/\/preprod.realtrends.com\/blog\/2018\/01\/16\/real-estate-and-hospitality\/"},"modified":"2025-03-13T02:32:07","modified_gmt":"2025-03-13T02:32:07","slug":"real-estate-and-hospitality","status":"publish","type":"post","link":"https:\/\/preprod.realtrends.com\/blog\/2018\/01\/16\/real-estate-and-hospitality\/","title":{"rendered":"Thought Leadership: How Real Estate and Hospitality are Similar"},"content":{"rendered":"

Real estate is a unique industry, but it does not exist in a bubble. The changes the industry is going through right now\u2014I\u2019ve seen them before.<\/em><\/strong><\/p>\n

<\/p>\n

 <\/em>I\u2019d like to share some similarities between real estate and the hospitality industry. To me, these disparate industries are more like parallel universes. In this article, I\u2019ll draw a few comparisons between the two and demonstrate why their similarities are cause for optimism, not concern.<\/p>\n

First, a little background. Before coming to Lone Wolf Technologies<\/a>, I spent most of my career (20 years or so) developing enterprise software for the travel and hospitality sectors. My focus there was\u2014and still is at Lone Wolf\u2014to make the transaction simpler and improve the lives of the buyer and seller. This entailed changes to almost everything, from automation to user experience, commercial booking engines to e-Commerce platforms. Let me tell you, making these changes was no simple task. The travel and hospitality sector lagged five to seven years behind standard IT, and the industry\u2019s sloth-like speed of adoption made bringing new product(s) to market a more significant challenge than it should\u2019ve been. We find the lack of speed of adoption to be similar in both the hospitality and real estate verticals.<\/p>\n

 <\/p>\n

Similarity #1: Old Processes and Technologies at the Center of It All<\/strong><\/p>\n

When it comes to IT, the real estate and hospitality verticals tend to lag behind the rest of the market due to antiquated systems of inventory that monopolize consumers\u2019 access to their data\u2014data that they need to make quality decisions.
In hospitality, this antiquated system is known as the Global Distribution System, or GDS. Its near monopoly on the industry is very similar to what brokerages and agents see in their relationship with the MLS. Challenges plaguing both spaces are legacy systems, unnecessary bureaucracy and proprietary connectivity options. However, hospitality has been able to move beyond these challenges with the banding together of vendors and providers of inventory. Will real estate be able to do the same?<\/p>\n

Hospitality also has some of the most demanding customers and revenue models in existence. I quickly became aware of the industry\u2019s need to provide flexible solutions to better suit the partners for whom we provided services and solutions. Most of these companies made their brand (and the processes within these brands) the cornerstone of their connection to patrons. I see the same construct here in the real estate space. Brokerages need flexibility in their software to express their unique brand. For technology to be flexible, it needs to be modern. So, before the industry can move forward, the technology needs to catch up.<\/p>\n

\"Real<\/p>\n

Similarity #2: Consumers are Forcing our Partners to Justify their Value<\/strong><\/p>\n

In the travel agent space, the elimination of commissions by the inventory providers (hotels, airlines, cars) forced the agency and corporate travel providers to adapt to a changing revenue model. As a result, agencies were forced to justify a service fee and provide higher service levels to stay in business. In this case, the consumer benefitted the most.<\/p>\n

In real estate, the proliferation of real-time pricing data and changes to the rules governing the sale of property is going to result in a new competitive landscape that will benefit consumers in much the same way. Brokerages will need to optimize the transaction and remove the number of hands it goes through before being settled. This will allow for the reduction of costs to the consumer, and also provide a better margin to the broker. History, as always, repeats itself.<\/p>\n

Similarity #3: Lack of Transparency Leads to Disruption<\/strong><\/p>\n

In our space, disruption is coming from online brokerages and technology providers (i.e., Zillow Group, Lone Wolf Technologies, et al). Travel saw this same disruption when Expedia, Orbitz and Travelocity gave consumers the power to book for themselves, while also lowering fees and providing the consumer a better, more transparent experience. Real estate is seeing the same types of pressures, as online and paperless transactions are becoming commonplace while fixed-fee brokerages are looking for more optimizations around the transaction as their margins get squeezed. Again, the consumer is the beneficiary of this disruption.<\/p>\n

These are just three of the many similarities between the Real Estate and Hospitality verticals. You\u2019ll notice that the two industries are alike in how they view their customer, sell their brands and define their value proposition to their agents and associates.<\/p>\n

Overcoming the challenges facing the hospitality industry wasn\u2019t easy, but we got it done. And real estate will too. The opportunity to turn these challenges into a better user experience, which in turn means a more profitable industry, is a thrilling proposition.<\/p>\n

Written By: Scott Gowdish<\/a><\/em><\/p>\n

Executive Vice President of Development, <\/em>Lone Wolf Technologies<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

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