GuestSpan Speaks!

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.

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.)

Next week, the HITEC (Hospitality Industry Technology Exposition and Conference) kicks off in Austin.

We’ll be there.

This will be our first time.

It must be a huge show because hundreds of vendors have spammed me with email and snail mail to get me to visit their booths. With all the hoopla, cocktail party invites, marketing and such, this is going to be big.

But, one mail piece really made me think about marketing to the hotel world.

On the postcard, the following claims were made:

-Add incremental revenue streams
-Enhance your guests’ experience
-Increase operating efficiency and productivity
-Help reduce overall operating costs

These are almost the very same things that we have said about our product since we solidified the concept. Since these are the driving value propositions in the hotel industry, it’s not uncommon to hear them from multiple sources.

But, the part of this that troubles me is the fact that these statements were made by Brother, a company that sells label makers, printers and fax machines.

Holy Crap!

If every peanut butter maker, horseshoe-er, mail carrier and window washer is using these value propositions to try to sell to hotels, I’m going to guess that most hotel execs are almost tone deaf or snow blind to those words. In fact, when a vendor says that they provide incremental revenue streams, the hotel suits must go running for the hills.

I mean, they want incremental revenue, but if one more manufacturer or maid carts tells them that they will add incremental revenue streams, they’re going to start splattering on the pavement below their lovely corner office windows.

Just for the record, Brother makes fine products. I haven’t ever owned one, but they sell a bunch and some people like them.

But, to market to this group of hotel decision-makers, we’re going to have to show value rather than just talk about it. That’s the only way were going to make a splash.

And, thank goodness for the great people that have allowed us to connect, drive us to the right guys and advised us along the way.

That will end up being much more important than all of the hyperbole on trade show postcards.

(Ask us about our research about the connection between fax machines and enhancing guest experience. In brief, there isn’t one…)

Chad and I spent two days in Las Vegas at the Hotel Design Expo (May 14-16, 2008). The convention was housed in the Sands Conference Center and must have included nearly 10,000 exhibiting vendors. Two full floors were devoted to displaying every conceivable item that could possibly be stuffed into a hotel room to improve its design and functionality.

This was our first trip to this conference. I couldn’t believe how many companies manufacture intelligence doorknobs for commercial purposes. Self-locking, personnel-tracking, microbe killing doorknobs were everywhere. (Did you know that they make a doorknob that kills about all of the bacteria and viruses that come off of your hand within 20 seconds? The coating is supposed to last for 20+ years! Jim Pinter or TownSteel was happy to show us how it all worked. With 6 kids, I’m going to install those doorknobs through my whole house.)

There was very little in the way of electronics at the show. A couple of vendors stood out, and I wish I had written their names down to give individual shoutouts. A few phone manufacturers were there. The coolest place we stopped was a virtual reality company that is doing amazing animation to preview cityscapes, design concepts and architectural renderings. The quality of their animations was top notch. (I can’t think of any use of their application in my life, but I’m going to work on it. I want my own virtual reality studio)

Chris’ HD Expo Conference Grades:

We met great people, but unless we’re a vendor there next year, I’m not sure if we’ll get excited enough to see a million shower heads, fabric textures and pillow displays again.

I don’t talk to librarians anymore. Can’t think of the last time I spoke to someone at the bank. Airline counters are a thing of the past. If I have 10 items or less at the grocery store, I don’t talk to a cashier (unless I have produce. Produce is complicated..). By the time I arrive at the movies, I go right to the concession stand and into the theater. When was the last time I went inside a convenience store to pay for gas? I’d never have to go into the store if they would simply put a drink dispenser next to the gas pump.

Every one of these areas in my life (and more) provide a self-service option. I am willing to take them up on their offer more often than not (except of course, in the case of produce. I can’t figure out how to ring up the right lettuce…)

And, judging by the number of growing terminals and the people at those terminals, I’m not alone. User interfaces are simple. The technology works. I can get what I want.

And, I’m not anti-people. I tend to like people. My wife is a people. My kids are people (in varying degrees). I’m mostly people myself.

But, I’ll tell you, there are some instances when I’m happier with my self-service experience than others. The library is fantastic. Easy. Quick. Scan a barcode on the outer cover of the book and be off. The grocery store, Wal-Mart and Home Depot are not my favorite. The self-checkout process is complex. Lots of payment options. “Unexpected Objects in Bagging Area?” ARGH!

Last week, I was speaking with Ram Thakur, PhD who is on top of self-service. He said that simplicity is the key. The more complex the process, the higher level of dissatisfaction. Makes sense to me.

But, self-service isn’t going away. It is getting smarter and will pop up in almost every area of our life. They don’t make mistakes. They are easy to use. They are less expensive and more consistent than humans and they don’t mind working at all hours without a break.

(Note: GuestSpan is very concerned with this topic as we intend to put self-service into every hotel room in the world. Hotel guests will get everything they want (food, product, information, service) more quickly than they have every experienced. Watch for us in your next hotel stay.)

Terry Jones, founder and former CEO of Travelocity, told a major hotel brand:

“People don’t like to stay at your hotel. People like what they can do when they are at your hotel. That may be a business meeting, getaway or trip to see Grandma. They didn’t come to your hotel to stay at your hotel.”

Mr. Jones’ comment was not what the brand wanted to hear, but was true.

And, this thought applies to business travelers as much as anything. When I am on the road for business, I want to be a member of the local community. Those first couple of nights, eating at the close diners rather than the good restaurants, are not as enjoyable as they could be.

That’s why GuestSpan is creating a system that puts hotel guests right into the local scene from the minute they arrive.

I’m not just trying to create self-promotion in this post. I’d appreciate readers leaving comments about what they would like out of their travel experience. What information are you lacking that would help you make the most of a stay in a new city?

Also, take 3 minutes to be part of our survey audience. If you travel for business, take our 9-question survey by clicking HERE.

We are going to make your next hotel stay much better than you might have imagined.

Hoteliers chant the refrain, “Our people (guest service staff) make the difference to our guests.”

Great.

But, not necessarily true.

I won’t spend time today talking about most of my business travel and the decline in guest service staff I have experienced.

Instead, let’s examine an article by Kate Leggett of KANA (A multi-channel client service company). Ms. Leggett talks about her experience of trying to build a relationship with a bank. After years of being a customer at her local branch, she realized that the bank didn’t know her any better than they did the day she opened the account.

In brief, when starting a home remodeling project, she opened a home equity line of credit. Nobody at the bank told her that a cash-out refi would have been less expensive. Shortly thereafter, a family emergency took her out of town and because she wasn’t thinking about her bank account, she incurred $250 of overdraft charges, even though there was plenty of money sitting in a side account. These events led her to think:

“After 10 years of working with my bank and being consistently disappointed, I considered what I valued in my interactions with my bank. Yes, having a personal relationship was important, but what was more important was that the bank help answer questions that I had, and to recommend basic financial plans tailored to my situation.”

She ended up finding an online bank that provided all the services she wanted, answered all of her questions and seemed to “know’ her better than the service people at the local branch. Kate’s concluding thought provides a lot to think about when considering the idea of service:

“I used to think that a long interaction for each service issue led to a better relationship. But now, I am not so convinced. A short, fulfilling interaction where you get what you want by looking for it yourself can be as fulfilling as one in which you are held by hand.”

To me, the message is that we have to rethink how we deliver meaningful service to clients, guests, patrons, etc… The presence of a person is less valuable than providing answers, no matter the interaction method.

Just something to chew on for those that claim that their people make the difference. You’d better have really good people if you’re going to beat technology.

We are believers in understanding a market. In fact, listening to clients, prospects and users is almost our religion. If our efforts don’t solve someone else’s problems, all of our work is a glorified ego trip.

But I digress.

We’re still working on our product rollout. However, I was very intrigued by a sampling of data that came back from our Meeting Planner survey conducted this month.

A couple of our questions described a technology device that we are installing directly into hotel rooms. After providing a bit of brief detail about the device, we asked the meeting planners to indicate their likelihood of either being more loyal to their preferred brand or switching away to a competing brand if this device were installed. The results were very strong:

• 46% said they would be somewhat more likely or much more likely to go with their first choice if this device were available to them.
• 30% said they would be somewhat more likely or much more likely to switch from the first choice to a second or third choice if they had access to this device in that property.

Considering the fact that the average meeting planner (and their staff) in our survey plans 20-50 meetings per year and most of these meeting involve 100-500 attendees (with 35% indicating that they regularly plan meetings for 1,000 attendees or more), the dollars in play in these numbers are GINORMOUS!

So, what is this device that was described to meeting planners? We’ll keep a little bit of mystery around this question. Suffice it to say that we’re pulling out all the stops to create a technology device that will satisfy the needs of hotels, travelers, meeting planners and anyone that spends any time in a hotel.

If the data are even close to reality, the potential of our services will provide significant, occupancy rate movements resulting in multi-millions of dollars of revenues for Avant-garde brands.

And, we believe that hotels are looking for that differentiator that will provide an edge. After all, everyone offers a bed, TV, Internet access and shower. Service levels are declining industry wide. Why not look for something that solves multiple problems.

Later, I’ll weigh in with feedback from business travelers and actual hoteliers. Trust me. It’s all good stuff.

Note: Media members may contact me for launch information at cdalley@guestspan.com (801-253-2459)

Yesterday, Drew McLellan of McLellan Marketing Group told the story of FreshBooks, a web-based time tracking and invoice tool, that went “miles beyond the ordinary” to listen to clients. In brief, company leaders struck out in an RV, driving from city to city, hosting barbecues and rubbing shoulders with clients.

Drew says:

This is a company that gets customer engagement. They didn’t sit back and passively wait for a customer to shoot them an e-mail or take an online survey. They got up and went to their customers. Literally. They didn’t do a hard sell, they let their brand’s personality dictate how they interacted.

No wonder 99% of their customers said they’d recommend them to a peer.

This worked because:

• It was fresh and different
• The company was making the effort — not asking the customers to do the work
• It had talk value — people told this story over and over
• It was true to Freshbook’s brand personality

The RV/road tour isn’t the right answer for everyone. But aggressively listening is.

In the hotel industry, everyone talks about listening to the clients (guests), but in my experience, this effort has been little more than a comment card left on a desk. Some bargain chains have begun to email me after a stay to solicit feedback, but I don’t remember the last time a member of guest management went out of his way to personally listen to me.

To find out more about listening to guests all the time, keep our blog bookmarked or subscribe to our RSS feed. We’ll tell you more about the types of real-time actionable feedback available through our systems.

Recently, Tammy Farley, a Principal of The Rainmaker Group describes their work with casinos, showing them how to change their way of thinking. The first step was to understand what the guests wanted:

Farley and Barfield are both strong believers in personal client service. After taking over the product ‘we pulled our customers together and asked them to tell us what their critical issues were.’ They told us, and we tackled the top ten items. Eight months later we delivered the changes,’ said Farley.

Before changes could be made, hotel ownership thought processes had to be adjusted or the entire plan would have been doomed from the start:

Revenue Management is a Way of Doing Business
In both markets, a shift in thinking was required. ‘Revenue Management is not just a software system, it is a way of doing business,’ said Farley. ‘It requires a cultural change at most companies, we made that education part of our training plan.’ Rainmaker provides best practices consulting to help clients become organizationally ready for the new information profit optimization software delivers.

After the information was gathered, distilled and acted upon, the following recommendations formed the foundation for future management decisions, both strategic and tactical:

Profit Optimization Boot Camp Helps Shift Corporate Cultures
Farley outlined three ways a company can ready its culture to leverage profit optimization software:

1. Shift your focus from occupancy and rate to profitability.

As an example, for Las Vegas casino hotels, think profitability instead of separate food and beverage, show, and spa spends. Farley noted industry champions of this approach include Gary Loveman, chairman, CEO and president of Harrah’s Entertainment, Inc., who brilliantly told Wall Street analysts their metrics do not fit the casino gaming industry. ‘He said to look at gaming profit per room and gaming win per room instead of Average Daily Rate and occupancy,’ said Farley. ‘Harrah’s annual report talks about lifts in those metrics.’

2. Move from silos to integrated departments. Consider letting the revenue management team report through sales and marketing instead of operations. This creates clear communication between the casino sales and marketing department, revenue managers and hotel operations.

3. Recognize the day in the life of a Revenue Manager has changed from crunching numbers to strategic thinking.

‘Companies that develop a focused revenue management philosophy and appoint an experienced executive to manage the process realize the greatest return from a profit optimization system,’ said Farley.

The take-home message is that hotels have to start thinking differently about the guest, the ability to monetize the guest and how the guest experience ultimately influences profitability. High occupancy/Low margin is customary, but “business as usual” is a strategy that appeals to the stale.

What does all this mean to GuestSpan? We’re in the business of showing you how to increase guest experience, monetizing their activities in the community and positioning hotel brands ahead of competitors.

Keep an eye on our blog and product developments. Next year, you’ll be able to say, “I knew GuestSpan back when…”