Guest Post: Why Premier Inn should make room for digital investment

Nick Rudd, Director of Consulting at MMT, explains why others should take notice too

Premier Inn recently announced ambitious expansion plans, looking to add 12,000 extra rooms over the next five years. 

But without a strong digital strategy that makes discovering, booking and staying effortless for guests, even the best-located rooms risk standing empty. 

This is Premier Inn’s chance to set the industry standard for hospitality - to lead through digital innovation, not just expand their physical footprint. 

Digital is the differentiator 

The hotel sector is stuck in an unusual place. On the surface, performance has stabilised since COVID and operations have recovered. But the industry is still facing challenges: above inflation increases in employer NIC costs, the minimum wage, and property rates are all raising costs.

As a largely UK-based operator, these issues have hit Premier Inn particularly hard, and its share price has struggled. Premier Inn’s full ownership model, which is in contrast to many in its competitive set, has been seen as a burden. But it could be one of its strongest assets. 

With total control over its offering, it’s able to drive the consistency that customers love. But much of its growth is built on repeat stays from existing customers, often booking directly.

Premier Inn still needs to acquire new guests at scale, and this is where competitors are taking the lead – offering superior digital journeys that make it easier for customers to book rooms faster and for the chain to retain them after. 

Hospitality disruptors like CitizenM and Moxy have embraced a digital-first mindset, streamlining the booking journey, integrating mobile-first experiences, and embedding personalisation throughout the guest lifecycle. This is redefining previous standards for speed, ease, and relevance. 

And AI is making this more crucial. Customers are already beginning to switch from Googling to using AI to compile options, inform decisions and even book on their behalf, and this trend will only grow.

Hotels need to turn up where the customer is looking. Chains like Premier Inn can’t afford to neglect digital. But where does this start?

Perfecting personalisation 

Personalisation is one area hotels can get a competitive edge. Individually curated and personal experiences are what the customers of the future will expect. A one-size-fits-all hotel booking approach won’t cut it.

Hotels can entice guests by building targeted room and dining recommendations and introducing flexible, demand-led pricing. Personalisation can also go beyond the booking stage. This can mean anything from mobile check-in to tailored in-stay offers, from post-checkout follow-ups to loyalty rewards. Hotels can leverage first-party data, which sheds light on guests’ backgrounds, enabling sharper and more accurate personalised experiences. 

A strong digital loyalty scheme is also now an essential. Some hotels excel in this space whilst many still lag, including Premier Inn. Other than remembering a customer’s details and showing existing bookings, the ‘My Premier Inn’ account adds little further value. 

The chain ought to maximise tangible benefits offered in the next iteration of its loyalty scheme. Meaningful perks like upgrades, early access to offers, bundled packages, or differentiated pricing will boost guest experience. And these benefits should be tiered and data-driven, rewarding both frequency and spend. 

Investment in digital should also be made with a view to improve profitability per room. Last summer saw demand dip for its budget-friendly rooms as travellers upgraded to more expensive options as the cost of living eased. 

The better hotels can predict demand, the better their pricing and overall property utilisation will be. Investments in data management and AI to predict demand, will pay dividends in the long run. Those who succeed will ultimately prosper with higher margins.

Embrace digital and rest easy

Premier Inn’s ambition should be praised. More rooms means more capacity to host guests and give them an unforgettable experience. But physical growth without investment in digital risks building more capacity than the market can support.

Times have changed and travellers want a fully-connected, AI-enabled digital experience when booking hotels. Businesses across travel have woken up. Airbnb’s CEO even made headlines recently claiming the platform is going to become an AI-first app with agents that can book trips for you.

It’s time for Premier Inn and other hotels to take note and invest in digital infrastructure. By doing so, they can set a new standard for scalable, profitable hospitality. Do it correctly and digital ambition will match physical ambition.