GETTING PERSONAL HOW TECHNOLOGY IS LEADING HOSPITALITY INTO THE FUTURE. by Tom Schoeve

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1 GETTING PERSONAL HOW TECHNOLOGY IS LEADING HOSPITALITY INTO THE FUTURE by Tom Schoeve

2 TRAVERSING A NEW HOSPITALITY ECOSYSTEM. TO MEET THE NEEDS OF TODAY S HYPER-CONNECTED TRAVELERS, THE HOSPITALITY INDUSTRY WILL NEED TO GET PERSONAL. IT S GOING TO BE ALL ABOUT GETTING TO KNOW YOUR CUSTOMERS LIKES, DISLIKES, TENDENCIES, AND INTERESTS SO YOU CAN ANTICIPATE THEIR NEEDS, LONG BEFORE THEY BOARD THE PLANE OR ARRIVE AT THE HOTEL. Developing new revenue models that deliver interactive, customized travel experiences is going to be essential in order to compete and meet customer expectations. Spurring this movement is a new generation of technology-savvy travelers, who expect the same level of personalized experience and access on the road that they get at home. Airlines, hotels, online travel agents, car rental companies, and even cruise lines will need to enable the exploding use of advanced mobile devices. And, at the same time, take advantage of them as revenue drivers. THE HOSPITALITY INDUSTRY WILL NEED TO FIND NEW WAYS TO ENGAGE WITH HIGHLY CONNECTED CONSUMERS. 2

3 WHAT DOES THIS MEAN FOR TRAVELERS? YOUR SMARTPHONE WILL ACT AS YOUR PERSONAL CONCIERGE. 1 Before you head to the airport, you ll be informed of weather or traffic conditions, your departure gate, and which security line is the shortest. SAN DIEGO WEATHER 72º H O T E L ROOM KEY ENABLED #204 2 Upon landing, your hotel will be notified and you ll be prompted to check in while still taxiing to the gate. TAXI WAITING ZONE 7 3 By the time you walk out of the airport terminal, your taxi or hotel shuttle will be waiting. SCHEDULE ROOM SERVICE? YES NO 4 When you arrive at your hotel, the staff will already know who you are and will have customized your room preferences, made your dinner reservations, or delivered your pre-ordered room service within minutes of arrival. 7:07 PM 5 If you re a guest with status, or there was a delay or inconvenience en route, your complimentary drink awaits. The future success of the hospitality industry will largely depend on providing not only a superior on-premises experience, but extending that experience outside of the property by finding new ways to engage with customers through their mobile devices, interactive displays, and digital kiosks before, during, and even after they travel. 3

4 THE PRESSURE TO EVOLVE. THE PROLIFERATION OF CONSUMER TECHNOLOGY HAS CREATED A NUMBER OF CHALLENGES FOR THE HOSPITALITY INDUSTRY. ESSENTIALLY HOTELS ARE BEING UNDERCUT BY A NEW BRING YOUR OWN DEVICE AND CONTENT CULTURE. ON-DEMAND, IN-ROOM MOVIES USED TO BRING IN HIGH-MARGIN REVENUE FOR HOTELS. But, with the widespread use of online media channels such as Netflix, itunes, and Hulu, customers can now easily view movies on their notebooks or tablets both of which can be easily connected to most in-room TVs. Another declining revenue stream is the use of in-room Internet access. Mobile devices that have built-in Internet connectivity have created the expectation that in-room Wi- Fi will be free; otherwise, guests will simply use the wireless connection that comes with their personal data plans. Hotels are also under tremendous pressure to keep up with the high level of advanced technology that the average consumer now has in their own home and expects in their hotel room or even on the airplane. Keeping up with the latest technology can be an expensive investment. Meeting these consumer expectations is necessary in order to grow, but implementing change is often a long and inconsistent process, due to complicated ownership and operation models across the industry. Most hotels, even major chains, are franchise-style operations, leaving technology investment at the discretion and budget of the proprietors at each individual hotel. CONTINUE MOVIE ON ROOM #204 TELEVISION? YES NO TO OVERCOME THESE CHALLENGES, THE HOSPITALITY INDUSTRY WILL NEED TO CREATE A NEW BUSINESS MODEL AND FIND INNOVATIVE WAYS TO GENERATE REVENUE. 4

5 TURNING OBSTACLES INTO OPPORTUNITIES. THE GOOD NEWS IS THAT THE SAME TECHNOLOGY THAT IS MAKING THESE OLD REVENUE MODELS OBSOLETE HAS THE POTENTIAL TO DRIVE NEW, LUCRATIVE REVENUE CHANNELS. The mobile devices that ushered in a generation of connected travelers also present hospitality companies with the opportunity to deliver and capitalize on personalized travel experiences. PAVING THE WAY FOR PERSONALIZED TRAVEL EXPERIENCES ARE BRANDED MOBILE APPS. THESE INCLUDE HOTEL APPS THAT ARE DOWNLOADED ONLY FOR THE DURATION OF A SINGLE STAY. Many hotels are already experimenting with basic apps that allow customers to control in-room functions from their smartphones and tablets. Imagine entering your hotel room and finding the temperature is already preset to your preference, the blinds are drawn, and the TV turned on not to the menu channel, but to the movie you had been watching on your tablet during the flight. And you receive a notification that your standard 7 a.m. wakeup call is already scheduled. Going forward, mobile advertising solutions will also be a promising new source of revenue for hotels. For example: A hotel in London still has extra tickets for a show that s going to start in an hour; it can immediately send out mobile promotions to everyone in the hotel in a matter of seconds, either via SMS or push notification, offering them a limitedtime discount offer if they buy a ticket. 7:07 PM DISCOUNT TICKETS ARE AVAILABLE FOR THE 8PM SHOWING. PURCHASE 5

6 GUEST-CENTRIC TECHNOLOGY. IN ORDER TO THRIVE, THE HOSPITALITY INDUSTRY WILL NEED TO EMBRACE CONNECTIVITY, CONTENT, AND COMMERCE SOLUTIONS THAT WILL HELP THEM DIRECTLY ENGAGE WITH GUESTS IN THEIR ROOMS VIA TELEVISIONS AND NOTEBOOKS, AND ON THE GO VIA MOBILE DEVICES AND DIGITAL KIOSKS. CAPABILITIES SUCH AS REAL-TIME FEEDBACK AND MOBILE PAYMENT ARE ESSENTIAL TO RETAINING THE NEW TECH-SAVVY TRAVELER. Mobility, cloud, and near-field communications (NFC) platforms will enable hospitality to turn the very consumer technology trends that once posed challenges into new opportunities. But this is just the start. MOBILE ADVERTISING As the host, hotels will connect with local businesses to cross-promote their services and receive compensation from those businesses. BRANDED MOBILE APPS A single, branded app will integrate search and booking capabilities for accommodations, ground transportation, local restaurant reservations, and events and attractions; enable remote check-in; and deliver integrated commerce and media services. HUNGRY? The café is now open on level 1. CLOUD ACCESS Secure, cloud-based identity management and customer relationship management (CRM) applications will enable hotel systems to recognize a guest, access that guest s preset preferences, and automatically adjust the experience to meet their individual needs. NEAR-FIELD COMMUNICATIONS (NFC) Communications and other proximity-based information exchange technologies will enable guests to gain keyless room and amenities access, and transact and receive personalized information, and offers with just a wave of their mobile devices. BUY ONE CUPCAKE, GET ONE FREE. VENTI LATTE Order your usual? YES NO $4.24 TAP TO PAY 6

7 THE NEXT-GENERATION GUEST EXPERIENCE. THESE END-TO-END GUEST SERVICE PLATFORMS HAVE THE POWER TO CREATE A SEAMLESS, CONNECTED TRAVEL EXPERIENCE. Truly personalized guest services, from initial booking through checkout, will position hospitality companies at the center of their guests travel experience while removing many of the frustrations inherent with traveling ultimately helping improve brand loyalty and increase perceived value. BY DEVELOPING A STRATEGIC PLAN TO FULLY EMBRACE AND INTEGRATE MOBILITY, CLOUD ACCESS, MACHINE TO MACHINE (M2M), DIGITAL MEDIA, AND TARGETED ADVERTISING PLATFORMS, HOSPITALITY COMPANIES WILL BE ABLE TO CONNECT WITH THEIR CUSTOMERS IN NEW WAYS THAT WILL ALLOW THEM TO DELIVER A NEW STANDARD OF CUSTOMER SERVICE EXCELLENCE TO A NEW ERA OF HIGHLY CONNECTED TRAVELERS. THINK FORWARD. To access additional content, provocative analysis, and collective insight from the minds of forward thinkers, explore our thought leadership site. VERIZON.COM/ENTERPRISE/THOUGHTLEADERSHIP ABOUT THE AUTHOR Tom Schoeve is Managing Director of Retail and Hospitality Solutions at Verizon Enterprise Solutions Verizon. All Rights Reserved. The Verizon and Verizon Business names and logos and all other names, logos, and slogans identifying Verizon s products and services are trademarks and service marks or registered trademarks and service marks of Verizon Trademark Services LLC or its affiliates in the United States and/or other countries. Microsoft and Outlook are either registered trademarks or trademarks of Microsoft Corporation in the United States and/or other countries. All other trademarks and service marks are the property of their respective owners. ES /12 7

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