Hotel Technology Gets SAAS-y (Yeah. I Went There.)

August 20th, 2010 § 0

I’ve talked to a lot of hotel managers and owners, and when it comes to new technology the biggest barrier is not actually price – it’s installation.  Literally, you can offer your new gizmo for free, and they’ll turn you down; but when you tell them how easy installation is, they seem to perk right up.  This is why software-as-a-service (SAAS) is so cool: all the hard parts have already been handled.

Take GuestSpan’s digital concierge, iRoom, for example.  iRoom takes ten minutes to install at a property.  And by ten minutes, I mean it takes ten minutes for GuestSpan to call your property’s wireless administrator, email them the web link, and confirm that it’s running correctly.  Poof – iRoom is now bringing local information to all your hotel’s internet users, and you spent that time drinking coffee.

Do I need new equipment for iRoom?

If you’ve got wireless internet, you’ve got iRoom.

Does it use up any of my bandwidth?

Nope.

What if we want to add our own content, or make recommendations to our guests?

Great! Send us your content, and we’ll have it updated in about ten minutes.

How will you update new information?

We manage live data feeds that automatically update at every location.

What if iRoom is temporarily out of service for any reason?

Your internet is still running; your guests simply move on to their emails.

What about information security?

We have supermen protecting our stuff, and hackers can’t get to you through us anyway.

What about hardware security?

Our gear is stored in a secure location in the Western United States.  You can have a tornado, and you’ll still have iRoom.

What about terrorists, aliens or apocalyptic fire storms?

See above about our supermen.

What about –

What about –

What about –

What about –

Relax, it’s handled.  Now go to that mix-n’-mingle your admin scheduled for you.

My Top Ten Places to Visit in Beijing, and Why I Wish I’d Had iRoom

August 16th, 2010 § 0

First, let me tell you that international travel is easy. The vast majority of the human population has good taste in food, they don’t like to run over pedestrians, and 70% of all billboards feature pretty faces and cell phones.

Beijing is my Paris. There’s a surging optimism in the air, mixed with old-world charm and the brick-and-mortar feel of Philadelphia, and all of that in a city four times the size of New York. These are my top ten excuses to go back, again and again:

1. South Beauty, a restaurant so good I started looking for jobs in Beijing
2. That really cool tepanyaki place that Vinny took us to
3. That really cool Tibetan restaurant that our guide showed us
4. That really cool Uighur restaurant Vinny showed us on Ghost Street
5. The Forbidden City tour, thanks to our guide
6. The Badaling section of the Great Wall, again thanks to our guide
7. The Peking Duck restaurant, courtesy of one of my professors
8. The Pearl Market (much better than the Silk Market), where I got a great deal on some silk and pearls for my wife and daughter
9. The Brown Door, a restaurant Denny and I accidentally found next to the Pearl Market
10. The Chinese acrobat show, which our guide found for us – you know, the one where twelve girls ride around the stage on a single bicycle? Check it out on youtube, it’s pretty darn fun.

If you’ll notice, almost everything on the list was something that someone else showed me. If I had been flying solo, I would have been stuck with hotel food (and prices!), no idea how to shop for anything, and nothing to do but watch the news. There was a Starbucks right next to my hotel, by the way. It was fine, but it didn’t make the Top Ten list. Oh, and the front desk people were unbelievably charming, but their English wasn’t superb, so getting local information from them was still a challenge.

If only there had been some kind of technology available in my room where I could explore the city – not all of it, maybe just what’s within a three-mile radius – and see if I could venture out on my own…

Now, here’s a fun puzzle – try replacing “Beijing” with “Omaha” and see how quickly this article translates to your last business trip experience.

[NOTE: I emailed Vinny, to see if I can get the names of those other restaurants, which I’ll post when he replies.]

Defending RevPar with Value-added Service

August 10th, 2010 § 0

I have to pull the MBA card for a moment and respond to Stephen Hennis’ July 20 blog* about room rates and occupancy. The main gist of his blog is to prove that dropping rates to increase occupancy can actually hurt your RevPAR – which is a good message, because it’s correct in theory, and I’ve seen a number of hoteliers hold prices to their benefit.

For the record, I think he’s 85% right.

How Stephen is right:
Aside from the data analysis in his blog, there is the issue of cost structure. The folks in the supply chain world have a term called “Best Operating Level,” which basically means the level of production with the least per-unit cost. In the hotel world this translates to occupancy percentage. I’ve talked to a number of hoteliers, and most of them tell me their optimum occupancy is around 70-80%, which I have illustrated** below:
Cost Structure

If you use the market demand curve as a guide for pricing, you can determine an estimated window of profitability that (generally) peaks at that best operating level (see below).

So Stephen is right – it doesn’t matter where the demand curve falls, dropping your rates to increase occupancy will cause you to lose money. And since so many hoteliers wildly push for sold-out nights as a starting strategy, holding rates and scaling back to a more profitable 70% occupancy is certainly a smart play.

Now, for that 15% of wrong:
Of course, if demand drops so low that you can’t operate above your break-even occupancy level, you’re in enough trouble that holding rates won’t do any good. So you can hold, but there has to be a better option than continuing to bleed out of principle. This is why, in both good and bad markets, I’m a big fan of a simple, two-step process.

*Increase demand by adding value, then

*Regulate occupancy back to optimum levels through pricing.

Increasing value is the trick of course, because so many value-adding features are so cost-intensive; and who can really afford to spend money when the money is tight? I confess I hold glibly to the idea that the best values can cost little or no money at all. For example, organizing communications to increase service response time can increase customer satisfaction without costing a dime. It’s a great strategy, and it won’t come at the expense of your room rates.

Shameless, self-promoting plug: GuestSpan’s iRoom has a quantified positive impact on customer satisfaction, and offers a cash-positive return on investment. Check it out at www.guestspan.com/iRoom!

*Stephen’s Blog can be read at http://www.hotelnewsnow.com/blog.aspx?PageType=Blogs&a=117&b=3704

**The illustrations are based on Bob Bobson’s Sleepy Mountain Inn, a cozy boutique at the base of the Misty Mountains, near the Mines of Moria.

The Legacy Burden – How the Hotel Industry Did It Right by Not Doing It Right

August 3rd, 2010 § 0

Ten years ago, “bringing the hotel industry into the 21st Century” meant finding a way to patch your Springer-Miller System together with your GuestWare and your Delphi – and when the IT department had trouble integrating the three, you had to hold inter-departmental meetings to coordinate everyone’s data.  This was better than the old-school paper trail?  The argument was always a long shot, because old-school managers have all the time in the world see if a new technology will float.

We’re now ten years into the 21st Century, and some hotel properties are still using paper to manage their guest accounts – and the computer monitors at the front desk might have LCD screens, but come behind the counter and you’ll see more DOS and dot matrix than most hoteliers would care to admit.

Historically, the hotel industry side-stepped the “new technology imperative,” and waited to see what would happen.  Most people would be tempted to criticize hoteliers, because now they have a lot of old-fashioned infrastructure.  However, what they don’t have is a legacy burden of obsolete technology.  In a market as mature and competitive as the hospitality industry, “incremental increases in profit margin” are simply not a compelling argument.  If you want to introduce new technology into their world, you’ve got to be willing make a serious impact; otherwise it’s not worth taking seriously.

Well…how serious does “zero impact on existing infrastructure” sound?  That’s the kind of magic that software as a service (SAAS) can make for the hotel industry.  All hoteliers had to do was to wait until technology caught up to them. SAAS now provides a way to access 21st Century technology without such a large capital investment.  Want a “hotel in a box” or “telecom in a box”?  With SAAS, you don’t even need to buy the box – you just plug into it.

Here are five great examples of SAAS technology in the hotel industry:

SOFTWARE PRODUCT
*iRoom by GuestSpan Digital Concierge / Guest Information Systems
*Libra OnDemand CRM/Social Marketing
*EZYield Revenue/Reservations Management
*HotSOS by M-Tech Internal Operations Management
*GuestCentric Online Marketing & Booking

Again – 21st Century technology, zero impact on infrastructure…I think the waiting is done.

Customer Service – Do we all still need to be reminded? Probably.

April 28th, 2010 § 0

John Ely wrote an article that was featured in Hotel and Motel Management. The article provides a view into a stay at a conference hotel in which he experienced very good customer service.  However, he observed a problem between the guest service staff and another guest, and this experience still sticks out in his mind.

On the one hand, his observations are likely understandable by most of us.  Humans seem to allow the tarnish of one small event to upset the shine of a beautiful object.

On the other, as I read, I couldn’t help but pity hotel managers worldwide.  For the most part, guest are a pain in the neck and necessary evil.

Oh, of course, 90% of the guests in the hotel are pleasant and may not even require any guest service interaction.  But, the other 10% seem to have very interesting and unreachable expectations.

So, guest dissatisfaction is a way of life and will be until the end of time.

In the end, I commented to a friend of mine that I can’t believe that an industry as mature as hospitality would feature this article at the top of the daily newsletter.   Let me be clear.  I don’t begrudge Mr. Ely’s observations nor recommendations.  I just came away from the article wondering why it is so hard to consistently deliver on this concept.

What do you think?  Was this article something that is “just in time to make our hotel better,” or is it discouraging that the industry needs to remind us of the mundane tasks?

Increasing role of technology relieves pressure from guest service staff

April 23rd, 2010 § 0

This week, I read with interest the press release from Marriott touting its award for the Courtyard GoBoard.

Read the article HERE

The content is good and the application is generating interest.  From most accounts, the GoBoard starts out as a curiosity for guests, but their appreciation level grows as they use the simple touch screen interaction.

Hoteliers generally want to proclaim that their guest service staff sets them apart and provides value to the traveler.  Surely, this is the focus of hotel management day in and day out.

So, what happens when you provide less personal service and more technology solutions?

It would seem that this is a good combination, especially among the upcoming, tech-focused generations.

Does a guest receive a favorable interaction point with the hotel just through a touch screen information source?  Yes.

Does this pattern provide lower-tier hotels with the ability to add service and compete with some of the higher-end brands?  Yes.

Is this advance in guest service technology good for the industry?

In a word, yes.

Keep your eye on the merger of technology through kiosks, smartphones, and services provided through the guest laptop.  It’s what we do every day and the market is growing by the minute.

Hospitality Industry: Guest Intelligence & Marketing

September 7th, 2009 § 0

Creating a great guest experience is fundamental to building successful long-term guest relationships and brand loyalty. Hoteliers in the current environment are requiring a holistic view of their guests to understand who they are and what their needs are likely to be. This requires integrating business intelligence (BI) into virtually every facet of their properties’ guest touch-point activities.

Current hospitality industry market intelligence supports the trend that Hoteliers require more than just the traditional static, backward-looking reports: They require insight to support collaborative analysis, forecasting, and decision-making so that their analysis and planning can help drive more ineffective business decisions – and ultimately enterprise financial performance. This requires an integrated and feature rich solution that provides complete and accurate information that is easily accessible to management and workers throughout the company.

Key challenges facing hospitality industry executives include:

  • Hospitality organizations typically run different BI applications for different business and support activities throughout the company.

  • Dissimilar systems may be used at headquarters versus property level, due to franchise-owner models as well as to the industry’s high level of merger and acquisition activity.

  • A high proportion of legacy and proprietary applications are still being used, typically without appropriate application interfaces and advanced business intelligence functionality.

    • The benefits of successful business intelligence are as follows:

  • A solution that stores all guest interactions, which provides timely business intelligence to the property on demand. For example, hotels receive accurate and targeted guest usage patterns, spending behaviors, and service preferences data. Hoteliers and brand managers can utilize this intelligence to support the success of future marketing events and campaigns etc.

  • Business intelligence can be used to benefit the property in a great many ways. For example, a property or brand of hotels can strategically partner with service providers that draw the most attention. Providing the hotel and service provider the opportunity to create joint marketing relationship to enhance both brands and increase revenue.

  • The information can also be used in one-to-one marketing. The hotel can create marketing campaigns based on usage and spending habits.

    • Going Back to the Country Store

    July 10th, 2008 § 0

    I have been reading a lot of marketing articles, blogs, white papers, and books lately. All in an effort to become better equiped to bring GuestSpan’s solutions to market and make the customer want to buy. We have conducted market research, spoken to hotel owners and travelers, attended trade shows and conferences, and pretty much talked to everybody we could to promote our concept and gauge market reaction.

    It has occurred to me in all of this that all of the time and effort we put into cleaver marketing schemes and research is really an effort to get back to the days of the country general store. We’ve all seen them in movies. And some of us have even lived in small towns that still have something like them. In early America the general store was the hub of economic activity in small towns. Everything happened around the store- mail was delivered there, telegrams were sent and recieved, and every good imaginable from animals to household cleaners were sold there. But the centerpiece of the general store was the shopkeeper.

    The shopkeeper knew everyone in town, knew what they bought and sold, knew who the sent mail to and recieved mail from, knew where they lived and what they did for a living-He knew pretty much everything. It wasn’t this knowledge, though, that made the shopkeeper so good at what he did. He really knew his customers. He lived with them. He knew, for instance, that Mrs. Jones hosted a party every Thursday and liked to serve carrot cake. So he made sure that he had it in stock and fresh for her when she came into the store. He also knew that the Smith children didn’t care for licorice, but liked horehound. So when Mr. Smith came in for the groceries there was always a package of horehound sent home with it. It was these little personal touches that made the shopkeeper indispensible.

    Modern technology and the supermarket essentially did in the little shopkeeper, and ever since then businesses have been trying to get as close to their customers as he was. Technology has come a long way in helping business accomplish this, but there is still a great deal of distance between the business and it’s customers. I think that when we truly start to understand our customers one an intimate level, for instance, knowing which hotel guests like to order extra pillows, and which restaurants the most frequently visit when they stay at our hotel that we will truly be closer to the kind of relationship the shopkeeper had with his customers.

    This is something GuestSpan is striving to deliver to the hospitality industry. I don’t know what the end game looks like at this point. But bringing guests, hotels, and the surrounding community closer together makes things better for everybody.

    Too Much Stuff on the Hotel TV

    July 3rd, 2008 § 0

    How many different services and advertising channels can you pack into one television? HITEC in Austin provided us with dozens of vendors that seek to make money through televisions installed in hotel rooms.

    And, most of it is just garbage. At least, that’s what the Marriott hoteliers are telling us.

    These vendors are trying to feed advertising, hotel information and paid content through the primary entertainment device. For the most part, their value proposition is poor. The television can’t carry all of those businesses. Unfortunately, it is an easy target for expanded services simply because it already exists in every room and tapping into an unused channel is too tempting for vendors.

    The problem with TV content providers is that people aren’t looking for information there. When a business traveler turns on the TV, they are heading toward a specific channel or program. So what if Lodgenet is the default channel to pop up? They are one remote control click away from being invisible and irrelevant. Usage and linger rates show that Lodgenet appeals to a very, very small subset of travelers overall. Some people check their bill on the TV. Others order the occasional movie. But, about 98% of hotel guests flip right past those information channels and never return.

    These vendors suffer from the same problem that all of those sponsor-driven internet access sites experience; the kind that immediately take the user to the sponsor’s screen upon logging in. When I head to the internet, I’m likely headed there for a purpose (check email, sports, maps, etc…). When the sponsor screen pops up, I don’t even see it. I’m headed toward my destination and that sponsor screen isn’t even a speed bump along the way. When I turn on my laptop, I’ have a purpose and that’s where I’m going.

    Same thing with Lodgenet and the other hotel service guides that feed through the television. When I turn on the TV in the hotel room, even if I don’t know the specific channel to watch, I know I’m looking for entertainment and channels that sell me stuff are rarely entertaining.

    The best chance I saw at HITEC was a couple of companies that provide scrolling television programming guides. They have timed the guides to take a while and the most appealing stations are always at the end of the list. While the guide scrolls, advertisements are shown. Because they provide useful information, they have the highest likelihood of attracting eyeballs for a few minutes each day. (For an entertaining conversation, call HotelGuide and ask them how they feel about the fact that EGSTV guys broke off and formed a competing service. Three words: “Bitter Cat Fights.”)

    In the next couple of posts, I’ll give my thoughts on the proper place for providing information and putting advertising in front of hotel guests.

    In the meantime, happy traveling.

    HITEC Wrap-up

    June 28th, 2008 § 0

    Three days at the show, miles of isles and great people. Plus tons of shwag for the kids. Not to mention the atmosphere of Austin, Texas and barbeque-o-plenty…

    Where was I?

    Impressions:

    1. A $278 billion industry is bound to spawn a few parasitic companies and the hotel industry certainly has its share. Good to see people getting so excited about door locks,

    2. Room of 2010 – Interesting ideas. Sign me up for a Wii in every room. I’ll play baseball against anyone in the hotel that wants to take a beating. The mattress-less bed looked intimidating, but must be comfortable. Else, why would they let it be part of the exhibit? And, Sony had a very small 11-inch organic LCD widescreen monitor that was absolutely gorgeous! If you have a HDLCD TV now, you’re going to chuck it out the window when you see the OLCD. (Yet another reason why I still have a TV from 1993. I’ll buy a new TV when the promise to stop inventing cool stuff.

    3. The Brand is the Dream – Most of the small to mid-sized vendors in the room are living for that day when a brand says, “You’re now standard install.” We’re part of that group. The real magic is making sure that you have business to keep the doors open in the meantime. Hope is not a strategy. Selling lots of product is.

    4. How much can you really fit in a television? – We saw at least a dozen vendors that want to pipe information/content/communications/guestspeak/marketing/stuff through the television. Understandable. The TV is everywhere. All you need is a signal and you have access to the guest.

    Of course, I’m glossing over so many hundreds of stories and people we met. There were a couple of competitive vendors in the crowd that visited with us for quite a while. I’ll let their identities remain a mystery, but you’ll know what I’m talking about if you were there.

    And, the booth babe from Image Technology Systems was memorable. Holy Cow! What was that red thing she was wearing on Tuesday? I’m not sure what Image Technology does, but they will forever hold a special place in my heart. (I hope my wife isn’t reading this blog entry.)

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