Disruption in Hospitality: The Target - Customer Experience Measurement

By Janet Gerhard Founder, Hospitality Gal, LLC | June 12, 2016

The hospitality industry is constantly under attack. New technologies, new entrants, new regulations, and changing customer demands require hoteliers to be relentlessly vigilant. It is not merely a matter of loyalty. Today’s fight is about relevance. In a world of digital transformation, no industry is immune. With every discussion on digital transformation orbiting around customer experience, is there an opportunity to disrupt how the hospitality industry measures customer experience?

A week in April with 250 global leaders from a major technology firm gave me new perspective on the uncertainty of digital transformation. The organization is midstream in its own digital transformation while rapidly positioning to enable its customers to embark on a similar journey. The undercurrent of the technology firm’s two-day global leaders’ event on digital transformation centered on the changing needs of its customers and the value it delivers through experiences --- a focus that is undoubtedly critical for today’s hospitality companies.

Mobile check-in, wearables, artificial intelligence and predictive analytics are indicative of the digital transformation underway in the hospitality industry. EY, Accenture, and many others want to advise you on how to re-engineer the experience to better serve your customers. In truth, the digital transformation agenda is all about avoiding “digital Darwinism,” a term that is often cited by Brian Solis, principal analyst at Altimeter Group. The hotel industry is being disrupted, and improving the customer experience isn’t simply about loyalty; it is about survival.

In its recent report, The Six Stages of Digital Transformation, Altimeter’s findings are not dissimilar to numerous other recent articles and white papers on the topic:

“Technology has empowered consumers to become more mobile, social, and connected than ever. This has changed how they interact with each other and with products, services and businesses. Digital transformation is your organization’s internal equivalent of external consumer evolution. It opens the door to new opportunities for innovation in how to design, integrate, and manage customer (and employee) experiences.”

Every discussion on digital transformation orbits around customer experience. My passion and work over the last 20 years has been on changing behavior – driving customer loyalty and improving employee engagement. I believe an argument can be made that digital transformation is applicable to how we measure customer experience. The question is where will this disruption come from? The sources I’ll explore in this article are the hotel brands, their vendors and a few existing technologies that if applied in new ways could be disruptive.

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Eco-Friendly Practices: The Greening of Your Bottom Line

There are strong moral and ethical reasons why a hotel should incorporate eco-friendly practices into their business but it is also becoming abundantly clear that “going green” can dramatically improve a hotel's bottom line. When energy-saving measures are introduced - fluorescent bulbs, ceiling fans, linen cards, lights out cards, motion sensors for all public spaces, and energy management systems - energy bills are substantially reduced. When water-saving equipment is introduced - low-flow showerheads, low-flow toilets, waterless urinals, and serving water only on request in restaurants - water bills are also considerably reduced. Waste hauling is another major expense which can be lowered through recycling efforts and by avoiding wastefully-packaged products. Vendors can be asked to deliver products in minimal wrapping, and to deliver products one day, and pick up the packaging materials the next day - generating substantial savings. In addition, renewable sources of energy (solar, geothermal, wind, etc.) have substantially improved the economics of using alternative energies at the property level. There are other compelling reasons to initiate sustainability practices in their operation. Being green means guests and staff are healthier, which can lead to an increase in staff retention, as well as increased business from health conscious guests. Also, sooner or later, all properties will be sold, and green hotels will command a higher price due to its energy efficiencies. Finally, some hotels qualify for tax credits, subsidies and rebates from local, regional and federal governments for the eco-friendly investments they've made in their hotels. The May issue of the Hotel Business Review will document how some hotels are integrating sustainable practices into their operations and how their hotels are benefiting from them.