In the Quest to Improve All Things Digital

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October 29, 2018
Guest Experience
Jennifer Corwin

It’s tempting to think of technology as a fairly quick, easy solution to most problems a hotel chain is having or as a powerful, if expensive, way to amplify what a hotel chain is doing right. After all, the right technology can indeed make many processes run better, help contain costs, and free up employees when they might otherwise be stuck doing repetitive tasks that take them away from customer interaction. Guests also expect a certain level of sophistication or access from their daily lives extended when staying at a hotel.

As Popular As This Sentiment May Be, It’s Not The Right Approach.
By itself, incorporating technology is no panacea to hotel business challenges. Adding in the latest gadgets, automating certain tasks, or otherwise rushing to appear at the cutting edge without having a strategic vision for what this spending on technology will achieve and how it might impact guests will likely leave you with a lot of debt to be paid down and stagnating customer satisfaction. 

Hoteliers should ask themselves one question:
How will this improve the guest experience?
A Good Comparison
A helpful starting point would be to look at examples from another travel industry: airlines.
Consider Jet Blue. As the first major airline to implement system-wide in-flight seatback entertainment, Jet Blue differentiated itself from other low-cost airlines. Its industry changing technological enhancement has kept it at or near the top of low-cost carrier satisfaction for years and it has earned a considerable amount of good will and brand equity. 
Also consider Alaska Airlines. Although not necessarily as focused on technology as other brands, its success in J.D. Power studies cuts across several factors that make the flying process seamless and more enjoyable. As my colleague Michael Taylor, who heads up the airline practice at J.D. Power once explained, Alaska manages to make “customers feel less like cattle, and more like individuals.”
Despite the different emphasis on technology, the end goal is similar: how to make things better for the people spending their hard earned money on their products and services.
Where Things Stand Now
Describing a modern hotel room should be easy. In addition to being clean, sleek, and stocked with complimentary toiletries, it will most likely contain a fair amount of technology: a large, flat panel TV that might also be a smart TV and perhaps even a TV in the bathroom mirror, a tablet for in-room controls and/or in-room information and communication, and a charging dock to keep various devices power. And of course, some hotels allow guests to check in with a digital key.
Incorporating various technological features has a clear impact on guest satisfaction – but only up to a point.
Consider the offering of flat panel TVs and a tablet for in-room information or communication.
According to the most recent J.D. Power research (July 2018), the former increases overall guest satisfaction by 12 points, from 825 to 837 on a 1,000-point scale. The latter lifts satisfaction by a much larger 47 points, from 825 to 872. No doubt some of this is due to the prevalence of some items, which guests come to expect as standard, and the levelling off of benefits after a certain point. But another part of this difference in impact on satisfaction is due to what each offers. Standard flat panel TVs that guests find in their hotel rooms, even the higher end models, can’t offer dinner or entertainment suggestions, give directions to an outside venue, or help contact the front desk; a well-designed in-room information and communication system can.
What About Apps And Websites?
Mobile apps are as common in the hotel industry as they are in any other, but many hotels are struggling to realize the benefits.
Lest there be any doubt, know this: guests who download an app to their device are 58 points more satisfied (874 vs. 816) than those who do not. In addition to brand affinity which acts as a natural boost, apps offer features to guests that are unavailable to everyone else. Utilizing an app as a digital key, for instance, increases satisfaction by 21 points (890 vs. 869), likely due to reduced likelihood of experiencing lost or deactivated room keys as well as general convenience. 
The problem? Only 23 percent of guests who had a hotel’s app on their phones during their stay reported using this app as a digital key, according to the most recent J.D. Power data. In fact, only 15 percent of guests report having their hotel’s app on their device, and a considerable 46 percent of these same also indicated they did not use this app during their stay. 
Apps not only allow for more options to modify and enhance the guest experience; they can also serve as an ongoing method of communication with consumers that are already fans of the brand or more likely to become fans. The lost potential for missing the mark with apps is huge.
There are also plenty of missed opportunities when it comes to the reservation process. Simply put, the direct booking “issue” is nowhere near solved.
Unfortunately, the problem is unlikely to abate any time soon. J.D. Power data indicate that 21 percent of all hotel reservations were made via an online travel agency site or mobile application in 2018 – up from 17 percent in 2015. An even larger 28 percent of younger travelers report using an online travel agency to make reservations. An overwhelming majority of guests (97 percent) state that they make reservations prior to arrival, so the potential for profits to slip away is vast.
But while the frustration around an online travel agency sapping profitability is understandable, hotel chains should not neglect examining the strengths and weaknesses with their own operations.
Taking Action
While technology may not be a cure-all, it certainly has value – and used correctly, it can have a positive impact on customer experience and satisfaction. 
For instance, consider how a chain might employ technology when providing services. J.D. Power data indicate guests prefer their hotels to offer not just a genuine sense of destination and authentic décor to their rooms, but that food and beverage provided had a local flavor. An in-room tablet could highlight complimentary, locally produced fruit or cookies available in the lobby. The same tablet (or perhaps even a smart speaker like Amazon’s Alexa) could give directions to a well-reviewed barbeque or Thai restaurant or venue where a local band is playing, or a local clothing shop or rare book store that sells unique items. 
That is, of course, just one set of examples. The possibilities are indeed numerous. Hotels just need to ensure they leverage their implementation of technology correctly. 
The thread that weaves together all of their efforts should be a focus on the guest – how to make things faster, easier, more convenient, and as seamless as possible. Focusing on anything else is likely to mean a lot of wasted time, resources and money. Hotel chains that fail to heed this message will end up running in circles. Their competitors likely won’t.

©2018 Hospitality Upgrade 
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