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April 16, 2019
Connectivity Trends
Jeffrey Parker

CES 2019 just finished and we’re left with the rumors and predictions of the next big things in technology. Some are evolutionally, most are revolutionary, and a few will find a way into your hotel room soon. 

Hospitality being constantly well behind the consumer technology curve, I asked several groups of hoteliers -- including technology leaders in consulting, brands and management companies, as well non-technology leadership in operations -- to share their perception of technology in the hotel rooms, how they select technology, what challenges they face and their ideas about tech impacting customer service. Some responses were what I expected, but many of these leaders provided perspective that I did not anticipate. 
It is no shock to anyone that insufficient capital is the most frequently mentioned reason why hotels are behind the consumer technology curve. 
One leader pointed to the hockey-stick like data appetite/needs of guests as an example. When at-home speeds are advertised at 200 MPBS or better, guests are looking for more and more from our hotels. 
With the consumer adoption curve getting shorter daily, we’re seeing new technology in our hotel rooms constantly. Everyone I talked to acknowledged that hotels need to look to adopt new technology but was frustrated in many ways with getting there.
How Did We Get Here?  Twenty-five to 30 years ago, a secondary phone line for guests to use for computer modems was a sound investment, and its impact lasted 8 to 10 years. Many major brands still listed a secondary phone line as mandatory up until five years ago. This investment lasted as expected, was able to follow standard depreciation schedules, and it was felt that technology investment could be predicted to some level. I’m pretty sure that was the last time that this happened. 
Ethernet started showing up in rooms 20 years ago, again for guest data demands. Remember when your laptop still had an ethernet port? (Yes, I can hear you in the back, with your hand up, and your special-order Lenovo workstation with an ethernet port, you’ve got so serious geek cred.) 
For a ground up hotel, adding ethernet was a no-brainer, but for existing hotels, ethernet was simply too expensive to retrofit. This led the industry to look to two solutions the wireless bridge and ADSL/VDSL. 
The wireless bridge. Remember those – a hefty brick with a power cord, an antenna and an ethernet port? The first hospitality Wi-Fi networks were deployed like this. It was uncommon for laptops to come with built-in Wi-Fi until 15 years ago.
ADSL/VDSL pre-DSL, a technology that allowed hoteliers to leverage older (gasp, CAT 3) cables to deliver some data to the guestroom. This was great technology, until the housekeeper started the vacuum within two square meters of the modem.  
Again, either solution included a massive CapEx investment, but with a reasonable time line for depreciation. 
Once manufacturers started putting wireless radios in laptops, we caught the wireless wave. Up to that point, the vast majority of technology in our hotel rooms was provided and controlled by the hotel team from stem to stern. Now our guests were bringing their technology into our rooms, and expecting not only for it to work, but the hotel to support it. 
Early Wi-Fi was a big, big spend, but investment was for 5 to 7 years and many hotel owners still had an appetite for the investment. 
And then … deep breath … serenity now …
Ten years ago, the Jobsian revolution started and we got the iPhone. The iPhone fundamentally changed how technology investment worked for hotels; fundamentally changed how hoteliers interact with their guests. Hotels were no longer leading in technology, no longer even keeping up. The chase began and we’ve been on the hamster wheel ever since. 
The iPhone, and its brethren on the Android platform, get dramatic radio updates every other year or more. As a result, Wi-Fi networks that were supposed to last 5 to 7 years barely last two or three.
Maintaining and updating solid Wi-Fi is no longer something that can be depreciated over 7 or 5 years, it has become an operational expense, often written off in one or two years. 
The resounding questions around how to budget, vet, select, implement and train are at the top of all hoteliers’ minds. Trust me, I did not have problems receiving responses. What I have heard from this group of responders is that making technology purchases is hard, not just Wi-Fi, but things like alarm clocks: The Apple 30-pin connector is obsolete, the Apple firewire connector barely breathing, and hotels are gun-shy to jump on USB C given the dramatic deltas in power requirements. USB ports placed in outlets and on charging stations as little as two years ago are underpowered for the latest generation of devices. What is the appropriate investment now? How can we sustain the cadence needed to keep up? 
How Do We Get Through It? Tradition suggests that hotels built one, three, five and 10-year capital plans. Now operators feel that budgeting technology beyond three years is worthless. 
One constant among many operators is that they don’t feel they have a concrete strategy in place to budget with the need to keep up with technology. Their budgets are a guessing game. Capital is being spent on other FF&E or building improvements and taken away from technology-centric projects. A new boiler is easy to ROI; new Bluetooth/NFC/USB C alarm clocks not so much.
Plus, many hotel technologies are more about steak than sizzle. Balancing the promotional buzz from having the latest gadget in your room must be scored against adoption, and often creepiness. Try to separate the difference and give your hotels a balanced meal.
One great example for investment is more outlets (receptacles) in our rooms, located where guests have access to them. More power in our rooms is always going to win, but that doesn’t mean wireless charging and more USB to me. It means a real receptacle. Our travelers all carry chargers (and I know you have a box of them in housekeeping that you could loan, if needed). That being said, your clientele could be really hot on wireless charging, and it could be a great investment for your hotel. 
Owners are increasingly wary of jumping on technology solutions that seem to have fuzzy ROI, fearful that they’re deploying solutions to meet a standard that will change and be obsolete in 24 months (anyone remember when ‘Jack-Packs’ were necessary?). 
How Do We Pay for It?  How do you calculate ROI, or even a budget, on technology that has yet to exist; yet to be a glimmer in a creator’s eye? 
Then the CapEx versus OpEx arguments come into play. The constant move from on-premise-physical technology purchases like servers, software, etc. is being replaced with application and infrastructure as a service taking capital out of the picture altogether. Hotels often find they no longer have the option to make a large capital purchase every five to seven years. Rather, they’re left with a recurring service plan on a three-year contract. So, capital monies in a five-year plan from 2014 can’t be used because there’s no asset to purchase, just an increase in the operating expense. 
Technology leaders must be as adept in a boardroom, or CFO’s office as they are on a keyboard or tablet. We must be salespeople, who can understand the strategic importance of technologies that are coming, craft a message to persuade owners to invest and sell the need for technologies that makes sense -- even if that technology doesn’t yet to exist. Technology leaders need to understand that there are no technology projects, only business projects. 
Making technology spend about the sake of tech is the way to lose the game. 
We must also be able to demonstrate the ability to budget to take risks, to fail, and get back up and take another risk. This requires the fortitude to make new mistakes, not the same ones over and over again.
How Are Brands Helping?  Having participated on many sides of the owner – franchisee, manager, investor, operator, guest – franchisor dodecahedron of hospitality, I have been on the call when a brand seems to dictate a new standard, been the enforcer when a standard is released and enjoyed the benefits of a good standard.
And yes, I have often wondered who has pictures of whom when a standard is pushed down that I don’t understand. It seems self-serving from my current seat, but trust me, brands really want the best for your asset, your operations and our guests.  
The major brands have developed structure around making decisions for their franchisees -- thresholds, accountability and test after test. However, brands can no longer spend a year or more to vet solutions, pick a horse in the race and mandate deployment over three years. The demand from the consumers is too great. 
The immediacy is further exacerbated by the risk of owners deploying technologies without proper controls, understanding and integrations. Brands must take control over what is in hotels with their names on the front door. The guest will always blame the flag on the building before the owner on the plaque. 
Most brands will direct owners to start with solid infrastructure, core cabling, switching, and access points. The recent trend is to push a cable plant that, for some, does not make sense today. But the franchisors are betting that it will lay the foundation for future solutions. 
Some brands feel that fiber backbones between networking nodes is critical, while others are pushing for fiber to the room. New build hotels are often asked to pull multiple ethernet drops in addition to fiber and coax drops, electing to bring everything in the room with the understanding that retrofitting after the fact is costly. 
Brand technology often creates a baseline for independent (or even other branded) hotels. They can take direction on some of the due diligence and lessons learned. Independent hotels competing with branded hotels in the same market often adopt the best of what brands are making successful. 
If you think your flag is unfairly dictating unneeded standards to your hotels, get involved. Brands love to hear from owners. Participate in advisory boards, make those educational sessions when they’re put on and always read the updates sent out. I find that many owners are too busy to keep up to date on some items. They end up missing announcements until the deadline hits and everyone scrambles. 
How Do I Get My Owners to Invest?  Constant communication with owners is key, not just about capital, but about technology that will have impact on operational expenses. It’s also critical to have open discussions about budgeting for technology that doesn’t yet exist. When wrangling with an owner that’s hesitant to adopt a brand standard, it’s important to be clear about the impact of not meeting brand standards. You should also review the impact to operations budgets and customer service. With limited budgets, it’s also key to make sure that we’re analyzing items that will reduce operational expenses, drive return guests or improves the asset’s valuation. 
Further looking at your mix of guests, several hotels cater to regular travelers that are ready and expect to consume offerings like mobile app/check-in/keys while others see travelers that might make one to four trips per year and have different priorities. 
The best move that a technology leader (a business leader) can make is to be sure that our owners are making informed decisions. 
How Do I Make My Investment Successful? Any technology spend needs to have buy-in from the team, or it will fail. A hotel can deploy the world’s best service delivery app, but if the learning curve is steep or counter-intuitive, user adoption suffers, and the money spent is wasted. It’s not just about making decisions on placing technology, it’s about building the proper solutions and team involvement to make those solutions successful. 
As an example, I reviewed a solution recently at a local pub in the old terminal at Denver Union Station. The management team had decided to deploy POS tablets for the wait teams to provide ordering and settlement tableside. This is a mostly beer bar with a limited amount of cocktail options and  limited food options, mainly tapas. Pretty simple POS setup, right? 
The owners purchased clunky tablets (likely to save CapEx) and relied on common Wi-Fi shared among other businesses in the station, so the solution actually reduced efficiency, frustrated users and impacted guest service. Those tablets now sit on a shelf in the back of the bar. Good thing they saved money on CapEx. 
A couple of times a week I see a similar solution at Sam’s #3 (best breakfast joint in Denver) where the servers have smaller tablets and the owners put in rock solid Wi-Fi (and it’s super-fast). The menu has hundreds of items, with modifiers and a full bar: a complex implementation, but the servers love it and the system flourishes. Food gets to me faster, exactly as I want it, and I’m back every week. 
Good Plan + Good Infrastructure + Team/Leadership Buy-In + Investment = SUCCESS! 
How Do I Train My Team? The next big hurdle that echoed in the responses is training and support of the technology in the room, in the hallways, and in your teams’ hands. 
I recently stayed at the DogHouse Hotel and Brewery in Columbus, Ohio. The room was appointed with a small (40ish-inch) TV, an analog clock, a beer tap and two beer fridges (ask me about shower beer!). They even had hard (metal) keys. No phone, no docking station, jack pack, smart mirror, Echo, lighting or HVAC automation. 
The point is, the hardest technology to support in the room is the TV. The BrewDog team is focused on teaching their staff about beer, not about technology; providing guest service, not supporting mobile keys. 
Every piece of technology you place in a room the guest expects your hotel team to support. The more tech, the more to learn and to support. It’s not as simple as placing a tablet bedside and expecting a guest to learn a new UI and self-support.
We need to question the need to deploy technology for our guests, if we don’t have the team to support what’s in the room. 
The training issues go beyond what technology is in the room. There’s a serious gap in understanding how to use technology; how technology is supposed to work. This is usually pointed to as a generational thing, but to me, only parts of it can be contributed to when someone was born.  
They don’t issue smartphones and tablets based on your date of birth. Screen time is not dependent on age.
Just like our guests, our team members expect intuitive user interfaces and technology that just works. Clunky interfaces on low-end hardware aren’t acceptable, regardless of the number of trips your executive housekeeper has made around the sun. 
Look at the churn rate on smartphones. Is the 2018 Pixel 3 XL really that much better than the Moto Z force from 2017? Probably not, but I’m millennial minded -- a new device is in my hand, and the old device is either sold or sitting in a drawer. While we’re seeing a slowdown from 18 months for average device churn to closer to 23, users are still replacing devices quickly. With each iteration, the systems get more intuitive, easier to learn and interact with. This is the exaptation of the millennial minded.
And that’s only part of the problem. You think churn rates on the new smartphones are short. Look at the average turnover of front-line staff in hotels. We simply don’t have the resources to teach our teams a complex system. It’s a bigger investment than the CapEx we were worried about justifying in the boardroom. 
What you’re putting in your teams’ hands needs to be something they can use, without a great deal of training or frustration, or they simply won’t use it. Gone are the days of people troubleshooting their own tech; the millennial minded expect the tech to just work and when it doesn’t, they replace it rather than fix it. They’ll stop using your solution if it requires too much energy to operate. 
Listen to your teams. It works. They can help your operations become easier, more efficient and a better environment in which to keep your team happy. People like to contribute. 
What About High-speed Internet Access (HSIA)?  
From what I saw in responses, we’re still struggling with HSIA. 
Our guests continue to need more and more. Several municipalities have GB fiber to the curb or to the house. Others are lucky to have DSL or rely on 4G carrier networks for data. 
There are hotels on the Purple Mountain Majesty, ships in the Shining Seas and yes, motels along I-10 when you are driving cross country to drop your kid off for college. Many hotels, resorts and cruise ships are lucky to get cable modems over DSL. They build the best networks, APs in every room, fiber to every switch, and 802.11ac in every public space. But even with the greatest network, if there are on quality high-speed circuits where your hotel is located, the property is in trouble. 
One of the big concerns my unofficial panel of experts pointed to is the ever-increasing need for more and more bandwidth. 
What’s on the Horizon?  Some of us have crystal balls, though mine is a little cracked. But these are some things that might be involved in your future budgeting sessions.  
Artificial Intelligence, Chat Bots and Machine Learning - Whether it’s guest facing, staff facing, no-one facing, the technology is coming. 
Chat bots are already interacting with guests via app or messaging, answering easy guest requests and learning the hard ones. The instant gratification needs of the millennial minded are going to drive more and more bots to help. If you haven’t started on a strategy to leverage, start now. 
Look at machine learning to figure out better environmental controls, better ways to run your laundry and the ideal time to pitch the perfect happy hour special to your guests. 
Voice In-room - I have long advocated for voice activated smart devices in the room. I genuinely believe it’s the future. Alexa, Google, Siri, Cortana, Watson -- all are working at some level to solve the hospitality problem. When evaluating your strategy, recognize that almost all of these technologies are designed for consumers. Always be wary of consumer technology in your hotel rooms. 
I know hotels that have successfully deployed voice into the room, using partners like Volera, so there are some great examples out there.
I’m waiting until we get better answers on how federal wire-tapping laws apply, better ways to have the guest interact with the device, particularly to opt-in to voice being on, rather than opt-out by hitting mute or unplugging the device. 
I also want a way to connect my personal Google, Apple or Amazon account to the smart device, I just feel they are too dumb without knowing me. 
If you move forward with voice in the room, dovetail your voice strategy with your AI/chat bot strategy to create a seamless experience for your guests and staff. 
Consumer Technology In-room - Smart TV, Apple TV, Roku, Chromecast, Fire TV, even smart speakers are all consumer technology first. When evaluating using these technologies, include a rock-solid plan to manage, wipe, update and protect. You can’t just put an AppleTV in a room, and consumer grade smart TVs are just plain D-U-M-B. 
Robots - Robots are going beyond delivering towels and toothbrushes, or welcoming guests to the lobby. Look for industrial robots to automate laundry operations, stock housekeeping closets, strip beds, drop laundry down a chute and even clean bathrooms. 
We’re starting to see both CapEx and OpEx models, even ones that you pay the robot by hour worked. 
5G, and not the 5ge snake oil that AT&T was selling last month, is going to rock our world. But if I can give you one piece of advice, avoid the sales hype and wait for a ratified standard. 2020 or 2021 is coming faster than we think; be ready. 
More and more of hotels operations, sales, distribution, profitability and guest service depends on business technology solutions – and on business technology leaders. I struggle to see how even small companies in hospitality don’t have a leader whose primary role is delivering technology solutions sitting at the same table as the rest of the hotel leadership positions when planning, budgeting or even just brainstorming. Technology leaders need to be involved and to be listening to other leaders, to make sure that they’re informed, and can help the business make decisions. 
Gone are the days (if they ever existed) that we can just throw technology at something. Proper planning technology needs to be part of a greater plan to deliver business solutions. Budgeting, consulting, evaluating, preparing, deploying and operating are the key steps to making sure that technology investment is successful and valuable to the business. 

©2019 Hospitality Upgrade 
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