Misguided loyalty program benefits and iPads in restaurants – some observations during recent travels

Having come back from a trip to the US over Chinese New Year there were a few things that I noted during my stay in (and around) a beachside 5-star chain hotel. 

As a loyalty program member, these days I get free Wifi internet access in most chain hotels which is much appreciated, and I did so in this one. Unfortunately, finding that the connection quality was substandard to outright pathetic certainly didn’t make me want to come back in a hurry. As survey after survey measuring guest expectations confirms, hotel guests consider free Wifi access close to mandatory. Restricting it to loyalty club members is a start in the right direction towards the inevitable free-for-all model that will eventually take root across the industry. But if you position free Wifi as a value add to loyal customers you need to ensure you deliver a quality product. If it is substandard, members will not feel that their loyalty has been rewarded - on the contrary. My guess is that non-loyalty members will appreciate free Wifi, even if the connection is slow, precisely because it’s free. But to offer it as a service for premium customers and deliver a substandard product is counterproductive. 

And if hotels in holiday locations defend their weak connections with the notion that their clientele is mainly concerned with surfing the waves rather than the internet, think again. Aside from just about everyone now having a connected device that demands to be, well, connected, hotels in holiday destinations are increasingly popular for off-site business meetings, conferences and the like, which attracts an even more connected type of traveler with a very different agenda during their stay. 

While we’re on the topic of loyalty club privileges, another thing I found mindboggling during my stay was the so called VIP breakfast room offering free breakfast for the two highest-tier members. It was little more than a feeding station that offered cereal (fruit loops…) pound cake, boiled eggs, cut up fruit, tea, coffee and juice. Cutlery and crockery was plastic (!!) and it finished at a miserly 9.30am, an hour before the ‘regular’ chargeable breakfast, lest you get too comfy and eat too many boiled eggs. If this was supposed to make me feel special and enhance loyalty, it utterly failed.  

Back on the technology front, and outside the hotel, I noticed how iPads have now well and truly found their entrée into the hospitality world. We went to two restaurants that used the iPad, one as a full written menu replacement, the other for the wine list only. While it is a great concept and looked very appealing and was fun to use, the two restaurants let themselves down by poor execution and not utilizing the device’s real possibilities. The restaurant that  tabletised the full menu let you dig down and view a photo of about half of the dishes, which made a great difference to us and we ended up choosing one dish that we wouldn’t have ordered if we hadn’t seen a photo of it. For the other half though, there was nothing, not even an extended description, which was doubly disappointing after having seen photos of the other dishes. 

The wine list-only tablet was even more disappointing. Instead of delivering in-depth information on the grapes, tasting notes, producers and terroir, it provided nothing more than the info you would get on a normal, printed menu. Handled like this, tablets in restaurants and hotels are nothing more than gimmicks that have a very short-lived appeal. To really make the most of the technology, the tablet-based menu needs to be a clear improvement to the printed menu. More descriptive information on the produce and preparation, photos, interactive maps, even videos of the chef at work, the region where the wine comes from or an interview with the wine maker – the possibilities are endless. And all of these value added services will not only ensure that diners are well informed, but they can be a powerful marketing tool that will entice your customers to come back again and again. 

The tablet is first and foremost a visual device and users expect exactly that, so hotels and restaurants offering this type of service should do it properly or not at all. One of our recent hotel customers understood this and made the wise choice not to add in-room dining as a function for their iPad-enabled service until they had the appropriate visuals to go with it and make the service appealing and useful. Smart choice.

Internet charges in hotels II: finding the middle ground in the multi-device world

In my last blog I mentioned some measures hotels can take to balance internet charges with guest expectations, so in this blog I’d like to get into more detail on what these actually are.

Whenever there are new research results released on what guests want in a hotel room (and there seems to be an abundance of these right now), one message is repeated again and again from Rio to Rabat and Berlin to Beijing: strong, fast internet access and for free, please. In a world where connectivity is taken for granted, and much information and other content provided for free, this is an understandable expectation – much like I imagine it became a standard to have a TV set in a hotel room, provided at no cost to the guest, 50 odd years ago.

If you are working in the hospitality technology space, it’s about now you may be inclined to feel a little nostalgic about those days when the highest tech gadgets in the room were a colour TV and a basic internet connection to let you cover off emails while one of 20 channels keeps you company in the background. The fact that these times don’t seem all that long ago reinforces that entertainment consumption and access has changed more in the past 5 years than it had in the 100 years before, a process that shows no signs of abating any time soon. 

The figures supporting these changes are truly staggering. If one billion new Internet users and 1 zettabyte (yes it’s a real word - over 1 trillion gigabytes) of Internet traffic in the next 4 years, as Intel predicted recently, are a bit too abstract to process, go to your average electronics retailer to see that it’s increasingly difficult to find consumer electronic devices that are NOT Wifi enabled – and I am not talking of the obvious e-readers, tablets or Blu-ray players here. Samsung just recently released its RF4289 refrigerator which comes with an 8-inch touchscreen and connects to the internet over WiFi, making Cisco’s prediction that there will be 15 billion connected devices by 2015 a lot more believable.

It is no wonder, and I suppose inevitable, that our fascination with the gadget, our connectivity addiction and the ubiquity of both is affecting the hospitality industry. Whether it is one conspicuous individual, traveling with laptop, iPad and smartphone, all vying to be “plugged” in to broadband access, or the modern family with its individual family members wanting to connect their respective devices when staying in the same room: the flood of connected devices will create a headache for hotels who, on one hand have to manage bandwidth cost, but on the other hand risk alienating their guests with escalating per-device charges.

But the industry is starting to experiment with alternatives. An increasing number of hotels choose to offer internet Free to Guest (FTG) as a marketing and branding tactic. While this will no doubt keep multi-device travelers happy, it may create serious bandwidth issues down the line if you read a recent In-Stat survey which says about 86% of tablet and smartphone owners are using them to watch video. Some hotels I have encountered in the region that offer internet FTG have started to warn their guests that if the amount of traffic a guest incurs exceeds a certain threshold it will cut access or move it to a lower tier. Whether this is real or just a threat I am not entirely sure (I’ve never been cut off), but personally I don’t believe that threatening your guests is a particularly effective measure if you are operating in a fiercely competitive service industry.

One of the areas where hotels can get some inspiration may be the airline industry and the way premium airlines handle their in-flight entertainment. Anyone who is familiar with the content industry knows that the VoD content on offer on flights has to be paid for through minimum guarantee and/or revenues share agreements with the relevant studios. Airlines recoup these costs (and then some, presumably) through advertising and absorbing them in the ticket price, which means they are not visible for customers who assume the content is offered to them for “free”, which creates a positive brand image. Perception is everything, so why not adopt the same principle for internet access in hotels rather than shoving the unpopular charges in guests’ faces? Based on historical data, hotels can average out bandwidth usage and spread the cost evenly across all room charges.

But it may be inevitable for hotels to introduce more predictable ways to manage their bandwidth costs while at the same time meeting guest expectations and corporate quality standards. One way of doing so is for hoteliers to look to the telco space where tiered systems with different Classes of Service (CoS) have been in use for some time. There are some similarities already inherent in High Speed Internet Access commonly deployed in hotels. The HSIA in hotels is predominantly built on a centralized gateway to the internet that effectively resembles an Edge Router, which in the telco world is commonly used as a single point of traffic management enabling different CoS to be applied to different users. While telco-class edge routers would be overkill for comparatively small operation like a hotel, there are a number of enterprise-class solutions available that are more suitable for hotels.

On the other hand, some major network equipment vendors have started to provide CoS capability with a software upgrade which eliminates the necessity for edge router-type equipment completely. While their solutions thus far are targeted to the telco world, it shouldn’t be long before lower-end versions will be made available to enterprise applications.

Either way, hotels need to get creative to bridge the gap between guest expectation and commercial reality and to do so, it is necessary to include both technical as well as strategic considerations to find the solution that benefit a hotel’s individual needs.