How Mobile Technology is Changing the Hotel Business

By Mark Heymann Chairman & CEO, Unifocus | March 26, 2017

Mobile technology has pervaded virtually every aspect of our lives, and travel is no exception. As people turn to their mobile devices for assistance with an increasing number of daily activities, the hotel industry has responded with apps designed to streamline processes from checking in to accessing one's room. Starwood Hotels & Resorts pioneered mobile room keys with its SPG Keyless product in 2014 and since then several other major brands have followed suit. There are also apps today that enable SMS two-way communications between guests and hotel staff, facilitating a wide range of interactions, including late check-out requests, room service orders, and restaurant recommendations.

The efficiency factor is clear, with benefits to both the guest (convenience) and the hotel (lower labor costs). But with automation increasing, and a corresponding decrease in face-to-face interaction, is the hotel industry, like the airline industry before it, destined for commoditization? And if so, what, if anything will drive guest loyalty? At the lower end of the market, as long as a basic standard of cleanliness is met, a hotel room is a hotel room, and price is usually the key deciding purchase factor. As one moves up the scale, however, service becomes more of a differentiator. And as it does, technology that reduces staff interaction can be a potential detractor.

The Commoditization of Airlines

As hoteliers consider the effects of automation on the guest experience, they would do well to consider the example of the airline industry. Compare flying today to the early 1980s, when Jan Carlzon took the helm of the struggling SAS Group. Within a year, the CEO had turned around Scandinavian Airlines through a focus on customer service that centered on what he called "moments of truth." In fact, Carlzon has been famously quoted as leading his First Wave seminars with "We have 50,000 moments of truth every day," identifying those moments as every interaction airline staff had with a passenger, and what would have to happen in that moment to create a positive experience.

Fast forward to today, and those moments of truth are few and far between unless one is flying first or business class. Travelers book their flight online, sometimes via a third-party site, check in and get their boarding pass online as well. Once on the plane, an economy passenger is offered a drink at best. The opportunities to change the experience for that passenger, therefore, have become more limited. So with service removed as a differentiator, the key driver of airline repeat business has become the miles one gets to travel for free as part of a loyalty program.

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Coming up in June 2019...

Sales & Marketing: Selling Experiences

There are innumerable strategies that Hotel Sales and Marketing Directors employ to find, engage and entice guests to their property, and those strategies are constantly evolving. A breakthrough technology, pioneering platform, or even a simple algorithm update can cause new trends to emerge and upend the best laid plans. Sales and marketing departments must remain agile so they can adapt to the ever changing digital landscape. As an example, the popularity of virtual reality is on the rise, as 360 interactive technologies become more mainstream. Chatbots and artificial intelligence are also poised to become the next big things, as they take guest personalization to a whole new level. But one sales and marketing trend that is currently resulting in major benefits for hotels is experiential marketing - the effort to deliver an experience to potential guests. Mainly this is accomplished through the creative use of video and images, and by utilizing what has become known as User Generated Content. By sharing actual personal content (videos and pictures) from satisfied guests who have experienced the delights of a property, prospective guests can more easily imagine themselves having the same experience. Similarly, Hotel Generated Content is equally important. Hotels are more than beds and effective video presentations can tell a compelling story - a story about what makes the hotel appealing and unique. A video walk-through of rooms is essential, as are video tours in different areas of a hotel. The goal is to highlight what makes the property exceptional, but also to show real people having real fun - an experience that prospective guests can have too. The June Hotel Business Review will report on some of these issues and strategies, and examine how some sales and marketing professionals are integrating them into their operations.