Table of Contents
HFTP International Hospitality Technology Hall of Fame 8 Inductees Talk Tech 15 2015 Inductee Profile: Michael Schubach, CHTP, CHAE A discussion of past, present and future technologies Recognized for being a go-to industry expert, supported by By Eliza Selig experience in multiple tech disciplines By Danielle Earp 14 2015 Inductee Profile: Scot Campbell. CHTP Recognized for leading the way in raising tech standards 16 Hall of Fame Inductee Gallery within hotel systems and operations Pictorial of the inductees who have received By Danielle Earp the prestigious honor
7 At HITEC, Take Time to Talk and Think Through 32 Steps to a Proper Litigation Hold Challenges Plan ahead for potential litigation with prepared guidelines An introduction from the HITEC 2015 Advisory Council Chair on preserving electronic documentation By Christina Cornwell By Daniel Vecchio and Don Scaramastra 18 Wearable Market: Initial Insights for the Hospitality 34 Building a Strong Business Case A guide to outlining a clear statement of objectives and the Industry strategies for achieving them As smart watches, glasses and other wearable technologies By Mark Haley, CHTP, ISHC go mainstream, consider current consumer perceptions and interest level 38 Meeting Together on the Technicalities By Ajay ‘AJ’ Aluri, Ph.D. Important fundamentals for building a trusted relationship between the IT and marketing teams 22 The Rise of Robotics in Hospitality By Brian Garavuso, CHTP Increased functionality and declining costs raise the appeal for service-oriented robots 40 Turn Customer Information into Valuable Guest By Galen Collins, Ph.D. Engagement 24 Are Mobile Payments (R)evolutionary? To develop value-creating digital or real-world engage- ment, consider three critical aspects of one-to-one market- The convenience of the one-size-fits-all model of mobile ing: quality data, customization and personalization payment using near field communication poses to eclipse By Robert Cole other payment options By Cristian Morosan Ph.D. and Agnes DeFranco, Ed.D., CHAE 42 Making Sense of Big Data How the industry molds the vast stores of data into useable 26 Why EMV Shouldn’t Scare Hoteliers content for customer outreach The push to shift to EMV-capable terminals is an opportunity By Sherry Marek to switch to more secure systems, including point-to-point- encryption and tokenization 45 Metamediaries: The New Frontier of Worry For By Steve Sommers Hoteliers 28 Engaging the Guest through Innovative Wi-Fi The power of the littlest screen could gain the greatest control over search parameters Technology By Loren Gray A behind-the-scenes look at Caesars Entertainment's Wi-Fi upgrade deployment, built to support guests' bandwidth demands and mobile operations By Monica Compton © Copyright 2015 by Hospitality Financial and Technology Professionals; 30 Managing With Mobile Tools Austin, Texas. All rights reserved. No part of this HITEC Special Report shall be Management utilities designed for mobile media bring the reproduced or transmitted in any form by any means, electronic or mechanical; command center out from behind the desk and immerse it including photocopying, recording or in any information or retrieval system, with- out written permission from Hospitality Financial and Technology Professionals. within the action HFTP® and HITEC® are registered service marks of Hospitality Financial and By Mark Heymann Technology Professionals.
HITEC 2015 Special Report 5 HFTP SPECIAL REPORT STAFF Frank Wolfe, CAE ProLinks Executive Vice President/CEO [email protected] Webinars Eliza Selig Editor/Director of Communications [email protected]
Jennifer Lee, CAE Advertising Sales / Director of Marketing ProLinks Webinars offer participants a chance [email protected]
to engage and connect virtually with innova- Steven Stout, CAE Director of Meetings & Special Events tive thought leaders on the most relevant topics [email protected] to the hospitality industry. Enjoy presentations HITEC 2015 ADVISORY COUNCIL from the comfort of your own computer while Chair Christina G. Cornwell interacting not only with the speaker, but other Hilton Worldwide attendees from all over the globe. Vice Chair Richard Tudgay Omni Hotels & Resorts
Jamie Christina Adams Get Started The Cliffs Scot Campbell, CHTP Caesars Entertainment Cihan Cobanoglu, CHTP, Ph.D. Visit the Membership/ProLinks section of the University of South Florida Daniel Conti, Jr., CHAE, CAM HFTP web site at www.hftp.org to view the Wyndham Grand Jupiter at Harbourside Place Mike Uwe Dickersbach, CHTP, MCP, NICE upcoming webinar schedule. Highgate Hotels Mehmet Erdem, CHTP University of Las Vegas Cindy Estis Green Kalibri Labs Archived Sessions Nelson Garrido, CHTP Interstate Hotels & Resorts Michael Levie CitizenM ProLinks Webinars are recorded and available Monika Nerger to members for viewing on demand. Archived Mandarin Oriental Hotel Group Sophie Pommois topics include e-commerce, millennial learn- Global Hotel Alliance Arlene Ramirez, CHAE, CHE, MBA, CHIA ers, green IT, Wi-Fi and more. ADR Hospitality Consulting Terence Ronson, CHTP Pertlink Limited Richard M. Siegel Hospitality Upgrade Peter William Smith, CHTP Analytical & Information Services Inc Bryan Steele The Royal Automobile Club Jerry Trieber, CPA, CHAE, CFE, CFF, CGMA Crescent Hotels and Resorts Tanya Venegas, MBA, MHM University of Houston Derek Wood Derek Wood Associates Ltd. 11709 Boulder Lane, Suite 110 • Austin, TX 78726–1832 +1 (512) 249-5333 • (800) 646-4387 • Fax +1 (512) 249-1533 www.hftp.org • www.hitec.org
6 HITEC 2015 Special Report At HITEC, Take Time to Talk and Think Through Challenges
The HITEC Special Report provides thoughtful analysis on many of the technology issues on our minds With the amount of media we have at our fingertips there is a potential for information overload. We all are good at sitting down with our smart phones, tablets or laptops and wending our way through articles, links and commentary. Yes, gathering information is no problem. Then you have HITEC, which presents to you in one place an arena for an interactive experience. An experience that brings you the opportunity for thoughtful exchange. While you are at HITEC, take in the multiple sources of information on offer — keynotes, super sessions, boot camps, tech talks, industry publications, exhibi- tors — and then reply right back so you can narrow in on the specifics useful to you. This is a once-a-year event where the dialog on hospitality technology flows, don't let it pass you by. Christina Cornwell This Report is a value-added bonus that I know will give you further insight HITEC 2015 Advisory Council Chair on the industry trends you will discuss. In addition to the articles written by hospitality technology experts, we have a special feature on the inductees to the HFTP International Hospitality Technology Hall of Fame. A group of induct- ees provided insight on the industry challenges they experienced over the past four decades and where they see the industry is moving going forward. Also featured are profiles on the two 2015 inductees, much congratulations, and a gallery of all inductees. I’d like to thank the authors who have volunteered to share their knowledge within these pages, as well as the members of the Advisory Council for their assistance with this project. In particular the three council members who helped review articles, including: Cindy Estis Green; Mehmet Erdem; Ph.D., CHTP; and Tanya Venegas, MHM, MBA. While HITEC is an established event, it remains responsive to industry changes and trends, due in large part to the experienced volunteers who help plan HITEC. Thank you for continuing to make this a place where important discussion happens.
Christina Cornwell is senior director of technology, APAC for Hilton Worldwide.
HITEC 2015 Special Report 7 Distribution
ecognized for being industry pioneers, inductees to the HFTP In- Inductees ternational Hospitality Technology Hall of Fame are the individuals Rbehind much of the hospitality industry’s technology developments. Having been active in the industry from a time when technology was almost Talk Tech nonexistent to the present where it’s a part of almost every function, we By Eliza Selig asked inductees to discuss their perspective on the industry. We talked about the challenges — old, new and ongoing — what technologies have had an impact and which will continue to bring change to the hospitality industry. A discussion of past, What follows is an insightful conversation with a group of inductees. present and future Participants include: Robert Bennett; Dave Berkus; Richard Brooks; John Burns; Fraser Hickox; Ted Horner; Jon Inge; Michael Kasavana; Douglas technology challenges Rice; Jules Sieburgh; Harbans Singh; Sal Spano and Frank Wolfe.
8 HITEC 2015 Special Report Talk Participants
Robert Bennett Dave Berkus Richard Brooks, CHA John Burns, CHA, ISHC 2000 Inductee 1998 Inductee 1997 Inductee 2006 Inductee
Fraser Hickox Ted Horner Jon Inge, CHTP, ISHC Michael Kasavana, Douglas Rice 2008 Inductee 2004 Inductee 2006 Inductee Ph.D, CHTP 2012 Inductee 1997 Inductee
Jules Sieburgh, CHTP Harbans Singh Sal Spano, CHAE, CHA Frank Wolfe, CAE 1998 Inductee 2013 Inductee 1990 Inductee 2011 Inductee
Notable IT Challenges functionality and maturity to be a truly competitive asset There is no question that change is one of the defining to hospitality managers.” And because there was not suf- features of technology, and as professionals who started ficient support for technology, it took some time for tech- in this industry over four decades ago, many of our par- nology companies to gain a foothold and stay in business ticipants went from zero to 100 percent integration. In the long enough for their product to gain acceptance. early days, if you can believe it, one of the largest hurdles Time and technology did move forward, with tech- to overcome was getting management to visualize the nology developments leading to a size reduction of benefits of technology tools. hardware — hello PCs and mobile media — and the Brooks says, “Perhaps the greatest consistent chal- improved functionality of systems. The challenge then lenge I encountered was just the acceptance of technology came in the form of disconnected systems: the POS in our industry. For many years technology was viewed as didn’t match the CRM, etc. Rice explains, “We operate a ‘necessary evil,’ or a tool that had not reached sufficient in a world with hundreds or thousands of vendors, most
HITEC 2015 Special Report 9 Hall of Fame Talk Tech
“Each seven to 10 years, there is On Architecture Challenges a new generation of technology that “ We operate in a world with hundreds or thousands of vendors, most challenges suppliers of systems to of whom don’t play by common architectural rules that would make upgrade or rewrite in order to remain current, and fend off new competitors it easier for hotels to bind them together in a cohesive way. So there who are starting with a clean slate are lots of loose ends that each hotel group (or even individual hotel) and no massive user base to service, needs to try to tie together as best they can, which often isn’t a good a reality that distracts R&D develop- or cost effective solution. ” ers of current solutions from concen- trating upon only the next genera- — Douglas Rice tion,” explains Berkus. “Hospitality technology vendors and users must learn to be agile and adapt to change — or suffer a loss of leadership or On Technology Development even relevance. This form of creative destruction has continued to ravage “ Hospitality technology vendors and users must learn to be agile and the industry from its technology be- adapt to change — or suffer a loss of leadership or even relevance. ginnings, and provides openings for new companies with new ideas peri- This form of creative destruction has continued to ravage the odically to shake up this industry.” industry from its technology beginnings, and provides openings for From the guest-facing side, hote- new companies with new ideas periodically to shake up this industry.” liers must align with cultural expec- tations. “Today the menu of IT op- — David Berkus tions is so vast that hospitality has a new challenge, and that is to provide a user-friendly solution to a sophisti- of whom don’t play by common challenge was] The need to seek a cated consumer that is used to being architectural rules that would make differentiator for every property not gratified almost instantaneously with it easier for hotels to bind them only for the guest, but also the indus- their own home/business selected IT together in a cohesive way. So there try press that would garner editorial,” solutions,” says Spano. are lots of loose ends that each hotel explains Hickox. And still an ongoing issue, group (or even individual hotel) despite a lot of progress in that direc- needs to try to tie together as best Never-ending Challenges tion, is architecture. “Interfaces be- they can, which often isn’t a good Today technology is an essential tween systems is another one; there’s or cost effective solution. ” business element and with its ubiq- been so much work on standards that The rise of consumer technology uitous qualities, also brings ongoing things have certainly improved, but brought along a new challenge for challenges. Not surprisingly, high on so many hotels want a little bit more hoteliers, as hotels needed to offer the list is data security, if the news is than the standard that the challenge support for guests’ own personal de- any indication. “Security is an obvi- never ends,” says Inge. vices and upgrades to in-room enter- ous one, though not so much that it tainment. Thus were the challenges doesn’t end, as that we didn’t use to Fantasy to Reality of providing connectivity to guests worry about it at all. Now we have Certainly, having been immersed and staff alike. Early integration of to, and the problem will continue to in technology in a time of immense Internet access was a major trial and get worse every year,” declares Inge. technological progress, thoughts to- error process, with hard-wired and Then there is the fact that technol- ward what could be possible can run Wi-Fi set-ups in question, and as us- ogy development still moves at far. We asked participants to name age demands continue to increase it lightning speed. There continues to technologies that were once a fantasy remains an ongoing issue. be the challenge to keeping up with which have actually become a real- With people’s fascination of tech- changes, maintaining functional- ity. Amongst the responses, we got nology also came the advantage, or ity with upgrades and convincing sci-fi like technologies such as video challenge, for hotels to use technol- executives to continue to make the calling, mobile media, environmental ogy as a distinguishing feature. “[a investments. controls, networked Internet-connect-
10 HITEC 2015 Special Report
Hall of Fame Talk Tech
the house systems that has allowed On Greater Access to Data hotels to improve efficiency and “ What is most exciting to me now is that by combining the power of cloud maximize the accumulated data: computing, and the universal access to data via the Internet, we can such as property management, point-of-sales and central reservation create business intelligence applications using large databases that will systems. “Specializing in hotel res- allow the hospitality industry to serve guests better, improve operations ervations and electronic distribution, and therefore thrive. I predict that data-driven analytics will become one it all began with the development of the next awesome technology-based developments to benefit hotels.” and widespread implementation of the hotel central reservation system — Robert Bennett (CRS),” explains Burns. The other change that was widely noted by participants was the pro- gressive downsizing of hardware On Problem Solving and the personal computer. “After “ Methodology to solve problems only comes with experience and if you having done this for 30 years, one thing that has changed over the have a good global network of contacts this helps as you can reach years is the technology platform: out to discuss with them what they did to solve a problem. Also, I have mainframes to minicomputer. This evolved to the personal computers found common sense is a great starting point in looking to solve issues and now we are evolving to mobile and sometime this is lost in the desire to solve a problem quickly.” devices and online cloud based — Ted Horner systems,” said Singh. Bennett further emphasizes the importance of reliable hardware: ed devices in all formats, and as Inge of operations. For one, the Internet “Early in my career as an IT man- enthuses: “a watch that could open has been a game changer — yes ager at a hotel, maybe 75 percent of my guestroom door, for one!” for pretty much everything. More my issues were hardware related, “Since my start was so long ago specifically for hospitality, it has leaving little time to improve ap- it is very exciting to live today with brought to the mainstream online plications or processes. Today, those the amount of power and portability distribution and rate transparency, hardware reliability and compat- that we have with us at all times using and made hotel information available ibility issues are almost completely tablets and smart phones,” says Sie- to potential guests via the hotels’ gone and IT managers can make burgh. “And next is the potential of web sites and travel review sites. Via much more valuable contributions to things like virtual reality, 3-D printing cloud-based systems the flow of data hotel operations and guest satisfac- and newer wireless alternatives.” is much easier to manage between tion. Inexpensive, reliable, standard Kasavana is amazed by the fact multi-property companies and their hardware and operating systems are that the service-oriented hospitality partners. really what have allowed technology industry has embraced self-service Bennett explains, “What is most to expand in hospitality. So one of technologies. “All self-service appli- exciting to me now is that by com- the defining technologies of my ca- cations are counter to the once held bining the power of cloud comput- reer was the PC, which represented principle that hospitality functions ing, and the universal access to all these attributes.” need to be conducted on a face-to- data via the Internet, we can create face basis. In other words, technol- business intelligence applications Keeping up With ogy had to remain out of the guest’s using large databases that will allow Technology Innovation sight in order to preserve the shelter- the hospitality industry to serve In a discipline that has been experi- ing of automation,” he says. guests better, improve operations and mental, new and evolving; keeping therefore thrive. I predict that data- up-to-date depended on information Technologies That Made a Difference driven analytics will become one of sharing amongst practitioners. More down to earth, but still mak- the next awesome technology-based Horner explains, “The only way ing a difference are the workhorse developments to benefit hotels.” to stay current is to attend as many technologies that are the foundation It is the evolution of back of industry events as possible, as
12 HITEC 2015 Special Report Hall of Fame Talk Tech
face-to-face contact is the best way to liaise with industry colleagues On What's Ahead and get the information you want “ I feel that the front desk of the future will change with the directly. HITEC is the first date in developments in mobility and cloud based applications. Guests are my diary and this year is my 27th in going to be driving the needs for the technology deployed in the hotels, succession.” He further explains, “Methodol- unlike currently where hotels are deciding what their guests need.” ogy to solve problems only comes — Harbans Singh with experience and if you have a good global network of contacts this helps as you can reach out to discuss with them what they did to solve a On HFTP problem. Also, I have found com- “ With the strength of strong leadership, HFTP will become a leader for mon sense is a great starting point in looking to solve issues and sometime the industry and help define where it can go in the next century.” this is lost in the desire to solve a — Sal Spano problem quickly.” Singh agrees, “In terms of prob- A Look Ahead: Impact Technology Final Reflections lem solving, the key issue is to iden- Networked technology and data As participants wrap up the conver- tify what the problem is. It seems stores are what will power hotel sation, they had some final thoughts like a no brainer, but many times the operations going forward. As the to share: problem is not understood. The key industry moves toward maximizing Kasavana said: “Nothing can to solving the problem is to look for their capabilities, the way guests will impact the way a hospitality business the right resources, knowing who be greeted, attended to and marketed is planned, conducted or managed can help you address the issue; or if to will all be supported by a technol- than a sound technology roadmap. not, point you in the right direction.” ogy net. Singh says, “I feel that the The industry has a promising future Another notable way to build front desk of the future will change given the progressive evolution of knowledge is to accept the guid- with the developments in mobility sophisticated property management ance of others. Hickox says, “I and cloud based applications. Guests systems, foodservice management am fortunate to have a number of are going to be driving the needs systems, and guest and non-guest mentors who would freely exchange for the technology deployed in the operated interfaces.” their thoughts on what was evolving hotels, unlike currently where hotels On hospitality professionals, from their labs. With this informa- are deciding what their guests need.” Burns is intrigued by, “The need by tion I was able to undertake further Already, the industry is tak- hotel management staff for strong research and determine how it may ing advantage of the direct line of leadership, mental agility, decisive- be applied within the industry.” communication to guests via mobile ness and a willingness to repeat- And one further way to build media. “Smart phones and the prolif- edly reinvent their teams and their knowledge is to share knowledge eration of apps give us the power to objectives.” yourself. Wolfe says, “Since I write do so many things from the palm of And finally, Spano has a positive columns for several magazines and your hand… The hospitality industry outlook for HFTP, the producers of also am interviewed frequently, I do has embraced apps to the point that HITEC: “I personally have had a a lot of personal research. But the mobility is an essential part of how unique experience spanning almost thing that I do that pays the most in hotels communicate with guests and half a century with the professional dividends is that I surround myself vice versa,” says Horner. association of HFTP, watching it with executive level staff who are And the advantages of big data transform from a financial defined smarter than me. The HFTP team are huge says Burns, “The potential group to a world recognized group constantly strives to balance ‘bleed- insight available through Big Data, of executive professional that know ing edge’ ideas against risk and re- to better understand what is happen- no bounds. With the strength of ward. In regards to the association’s ing and why, as well as the possibil- strong leadership, HFTP will be- services, our goal is to make them ity to achieve real personalization in come a leader for the industry and valuable and not just use technology online commerce and relationships help define where it can go in the for technology’s sake.” between hotels and their guests.” next century.”
HITEC 2015 Special Report 13 Hall of Fame Profile
2015 Inductee Scot Campbell, CHTP Recognized for leading the way in raising tech standards within hotel systems and operations
ot only is Scot Campbell, CHTP a member of the HFTP Global Board of NDirectors, but he is also one of the 2015 inductees of the HFTP Interna- tional Hospitality Technology Hall of Fame. Many peers and industry leaders wrote in to nominate Campbell and praise him for his exceptional leadership and status as an industry visionary. Today, Campbell is the vice president of IT connectivity and communica- resorts in the United States. When tions for Caesars Entertainment, but his interest in the hospitality industry was speaking to Campbell, it is clear why piqued at an early age. he was chosen for this project. “As a child my family lived in a hotel for a month while our new house was “Today it is becoming more im- being built in Omaha, Nebraska,” recalls Campbell. The entire hotel thing fas- portant that the IT systems in hotels cinated me. I was very curious about all the extremely nice people that worked are part of the brand perception. Wi- there and the jobs that they did. It was many years later that I was given the Fi, in-room technology, self check- opportunity to work in the industry and still picture some of the great experi- in, Bluetooth door locks, etc. are ences that hotel gave our family.” becoming brand differentiators. The Campbell “blames” his wife for his fascination with technology and cites resolution is that IT must become her gift of a Commodore Vic20 for sparking his passion. Campbell remembers more development focused and the it was then that he fell in love with technology and “time started to drift away, operations group probably should days became nights, and I saw the sun come up too many days.” become more IT aware. When this Campbell began his career in radio broadcasting and was soon led to Las happens, experiences begin.” Vegas. He gained entry into the industry when he was hired to work at Mirage Outside of the office, Campbell Resorts Inc. to centralize the IT function of the resort. It was at Mirage Resorts readily offers that his passion is hos- Inc. that Campbell recalls a memory he will never forget: pitality technology, but his purpose “My first day at Mirage Resorts, I asked the question, ‘What does customer is “to teach young people that there service mean to this company?’ The answer, I will never forget: ‘If you make is hope in their lives.” Next year, a mistake in the back of house and it costs the company money, I will want to Campbell will become the chairman of LifeTeen International’s board of “ Today it is becoming more important that the IT systems in hotels are directors. LifeTeen International is a Catholic youth ministry used by over part of the brand perception... The resolution is that IT must become 1,800 churches worldwide. more development focused and the operations group probably should Of all the things Campbell has accomplished in his personal and become more IT aware. When this happens, experiences begin.” professional life, he wants everyone to know that “being some small part know that you won’t make the same mistake again, but if a customer asks you of inspiring another person to be where the elevator is, and you don’t pick up their bags and take them there — great is what brings [him] the most you’re fired!’” satisfaction” and that he owes all of As time went by, Campbell continued to learn and grow and was soon faced his success to his wife and family with the behemoth task of helping to open MGM’s CityCenter in Las Vegas. and his love for God. CityCenter is an $8.5 billion dollar multi-brand resort boasting in-room auto- mation deployment that is recognized as the most technologically advanced By Danielle Earp
14 HITEC 2015 Special Report Hall of Fame Profile
2015 Inductee Michael Schubach, CHTP, CHAE Recognized for being a go-to industry expert, supported by experience in multiple tech disciplines
ou certainly would not be wrong if you called Michael Schubach a master Yof the hospitality industry. Schubach has established careers in both hospi- tality accounting and technology and will soon be adding HFTP International Technology Hall of Fame inductee to his list of accolades. With over 30 years in the industry, Schubach has proven time and time again that drive and know- well as the technology requirements how lead to success. for the 1999 and 2005 U.S. Open Schubach is a cum laude graduate of the University of California at Santa golf championships at Pinehurst Barbara, dual HFTP certification holder (CHAE and CHTP) and a 2007 MBA Resort in Pinehurst, N.C. graduate from Methodist University. Keen on sharing his knowledge with the Schubach’s time at CLS was par- industry, Schubach continues to lecture, teach, write and consult on systems ticularly memorable because of his worldwide. Schubach’s keen intellect makes him an easy participant choice for ability to work with an inspirational think thanks in North America, Europe, Asia and Africa. mentor, Dave Berkus, founder of “Few in our profession have the breadth of knowledge and practical CLS. Schubach says Berkus “led by experience that [Michael] has,” says Rod Jimenez, CEO of Sceptre Hospital- example, was meticulous and fair.” ity Resources, LLC. “his depth of understanding of the issues surrounding Schubach notes that Berkus “tried hospitality technology and his ability to distill proposed solutions into practi- to do right by everybody,” which is cal roadmaps is uncanny.” something he greatly admired of his Schubach began his hospitality career when the college dorm he lived and mentor. worked at opened as a summer hotel for backpacking Europeans. During the Most recently, in 2008, Schubach summers he worked as the manager on duty while the venue hosted back-to- joined the Trump Hotel Collection back week-long cheerleading camps. Of this time, Schubach says, “even after as their CIO, where he is responsible all that, I still wanted to work in hospitality.” for systems selection of the collec- Through the years, Schubach has served as a night auditor, front office tion of ultra-luxury hotels in SoHo manager, regional front office trainer and director of accounting services. New York, Waikiki and Panama. The In 1983 while Schubach was with L’Ermitage Hotels of Beverly Hills, he Trump Hotel Collection continues to open new destinations worldwide. Aside from the hospitality indus- “ I am thrilled and honored to be included in the HFTP International try, Schubach enjoys experiencing culture and the arts. He particularly Hall of Fame. I’m extremely grateful for the recognition by my finds great joy in writing and theater. peers, coworkers and friends in the industry.” “What would surprise everyone is that I want to win a Tony for a hit play, preferably a musical, maybe founded the Educational Services Group (ESG). ESG went on to become the starring Nathan Lane, Matthew exclusive installation team for Computerized Lodging Systems, Inc. (CLS). Broderick, Glenn Close (who can During a decade with CLS, Schubach supervised more than 2,500 PMS instal- sing) and David Hyde Pierce (who lations worldwide, participating in more than 200 of them personally. Schu- gets close).” bach also served for more than a decade as vice president of resort technology for ClubCorp, overseeing the IT efforts for five major destination resorts, as By Danielle Earp
HITEC 2015 Special Report 15 HFTP International Hospitality Technology Hall of Fame Inductee Gallery The Hall of Fame is HFTP’s highest level of recognition in the area of technology. Since 1989, 38 individuals have received this award as a reflection of their contributions to the hospitality industry. Hall of Fame members have been selected by their peers as representing the best in innovation and application and as leaders in their profession.
2014 2013 2012 2011 Barry Shuler Harbans Singh Douglas Rice Frank Wolfe, CAE
2010 2009 2009 2008 Nick Price Cindy Estis Green A.L. (Tom) Giannoupolos Fraser Hickox
2007 2006 2006 2005 John Springer-Miller John D. Burns, CHA, ISHC Jon Inge, CHTP, ISHC David Burroughs
2005 2004 2003 2002 W. Thomas Castleberry Ted Horner Richard Siegel Eric B. Orkin
16 HITEC 2015 Special Report 2001 2000 1999 1998 John Davis, III Robert S. Bennett Scott Heintzeman Dave Berkus
1998 1997 1997 1996 Jules Sieburgh, CHTP Richard Brooks, CHA Michael Kasavana, Ph.D., CHTP William Oates
1995 1994 1994 1993 George Zugmier Penelope Sellers James Yoakum John Cahill, CHA, CHTP
1992 1991 1990 1990 Richard Moore, CDP Jack Morgan Robert Horgan Richard Nauman
1990 1989 1989 1989 Sal Spano, CHA, CHAE Larry Chervenak, CHAE Carrol Lund Raymond Schultz
HITEC 2015 Special Report 17 TECH TRENDS Wearable Technology
Wearable Market: Initial Insights for the Hospitality Industry
everal mainstream technology By Ajay ‘AJ’ Aluri, Ph.D. companies in the last three Syears have aspired to capture the consumer market and to establish As smart watches, glasses and other wearable themselves as an early participant in the wearable technology movement. technologies go mainstream, consider current Some of the key players include Samsung, Google and Apple, but consumer perceptions and interest level many more have been following developments, looking for a way to make their own entrance into main- stream markets. According to PwC (2014), 21 percent of consumers in the U.S. own a wearable device and 10 percent of them wear them every day. To put this in perspec- tive, approximately 1,260 attendees at HITEC 2015 own some type of a wearable device, and around 600 of these individuals will be wearing them during the conference. With the expected surge in wearable watch sales in 2015, especially Apple Watch, these numbers will probably rise. Gownder and McQuivey (2014) of the Forrester Research firm found that a significant percentage (68 percent) of global technology and business decision-makers consider wearables a big priority in 2015. They even predict that consumers will readily adopt smartwatches, which will open the door to other wearables that can be clipped to or embedded in clothing, ear buds and headphones, and smartglasses. Where hospitality educators and
Ajay "A.J." Aluri, Ph.D. ([email protected]) is an assistant professor of hospitality and tourism management at West Virginia University in Mor- gantown, W.V. Aluri was selected to be a part of the Glass Explorer program in the fall of 2013. He has since used the technology to explore wearables and its influence on consumer behavior, specifically on user acceptance and adoption.
18 HITEC 2015 Special Report Wearable Technology
practitioners are concerned, it is vital studies, two million smartwatches (Smartwatch Group, 2015). The top to keep up with wearable computing were sold by March 2014, and 3.3 five manufactures of smartwatches research and market trends, to see million fitness trackers were sold include Samsung, Lenovo/Motorola, how this technology will influence in the U.S in the same year. In fact, LG, Pebble and Garmin. guest usage and business. fitness trackers appear in more U.S. The year 2015 is a trendset- households than smartwatches. ting year for smartwatches. With The Smartwatch Market However, according to Adams and the launch of Apple Watch, market In September 2013, Samsung Koenig (2014) of the Forbes and researchers and practitioners should launched its Galaxy Gear, a smart- Smartwatch Group, 40 companies now consider learning the market watch wearable device that could launched smartwatches in 2013, and studying consumer behavior “capture daily life from your wrist,” the market share of the smartwatch before and after the Apple Watch but the product failed to meet con- industry was $700 million in 2013, launch. According to Slice Intelli- sumer expectations and performed and the market was projected to gence (2015), Apple sold 1.7 million poorly in the commercial market grow to $2.5 billion in 2014. In fact, watches through pre-order. In fact, (Gibbs, 2013). What did these and the 2014 numbers have surpassed there are thousands of consumers other commercially available wear- the 2013 projections. In 2014, 6.8 still waiting for their watches to ables teach us about how consum- million watches were sold, with a ship, because most of the models ers receive this new technology? market volume of 1.291 billion — have a waiting time of six to seven Perhaps we have seen that it is too an 82 percent increase from 2013 weeks. According to other sources, soon to call this race. According — and the number of companies as of early May 2015, Apple may to PwC (2014) and Gartner (2014) selling them have increased to 89 have sold 3.1 million units, and may
HITEC 2015 Special Report 19 Wearable Technology
ultimately sell close to 15.4 million online community responded by • 88 percent of the respondents said units by the end of 2015 — double criticizing Google’s decision and its they were familiar with Glass; the total sales for smartwatches in Glass team. To be fair, Google never • 5 percent of the respondents had 2014 (Tibken, 2015). These current launched a commercial version of already used Glass; and projected sales of Apple Watches Glass; it was an Explorer “beta” ver- • If given an opportunity, 94 per- would make them the leaders in sion. It was always legitimate to test cent said they would like to try the smartwatch market in 2015. It innovations such as Glass and other Glass; should be noted that smartwatches eyewear wearables before a main- • At the suggestion that the price are designed to integrate with mobile stream market launch. was flexible or negotiable, a sig- devices and can never have their own Early research found that most nificant majority, 56 percent, said market. Even fitness trackers may be consumers prefer wrist-based wear- they would be willing to buy the wiped out as these applications are ables over eyewear and smartglass device if it cost less than $499; integrated with smartwatches. wearables (Read the Gownder & • Regarding the battery life of By contrast, smartglasses can McQuivey (2014) study from For- Glass when used continuously stand alone in their own market as a rester’s Research). If Google had with video capability, 37 percent hands-free, voice-activated device, developed Glass secretly, they would of respondents said they were and therefore have fewer limitations not have had such an excellent looking for eight hours or more of and a greater capacity to revolution- opportunity to examine current con- battery life; ize the way we use technology. The sumer behavior and explore the fu- • When using hands-free, voice current market success of smart- ture of the eyewear wearable market. command activated Glassware watches and fitness trackers is a This Glass Explorer program gave applications, 84 percent wanted good indicator that we need to be early adopters an opportunity to ex- to use Glass for directions, 82 looking into comparable kinds of plore this new technology and learn percent wanted to take pictures, wearable technology, particularly more about the future of wearables. 76 percent wished to record vid- smartglasses, although so far, that Furthermore, Google paved the way eos, 73 percent planned to send kind of in-depth market research for several start-up companies to de- messages, 69 percent would use hasn’t been done. velop cutting-edge wearable devices it to place phone calls, 68 percent specifically designed for games, would have used it to search, 64 The Smartglass Market augmented reality, virtual reality, percent would use it to translate When it comes to commercial smart- commercial use and personal use. In and 64 percent would use the glasses, Google is one of the first other words, this is the beginning of device to stream live videos; and innovators with its Glass Explorer wearables (especially smartglasses), • A 66 percent majority said they program. In the Google+ Glass not the termination. would be willing to buy Glass if it Explorers (2015) community, there was commercially available. were 46,519 users as of February Smartglass Preferences 2015. Unfortunately, this commu- The attendees at HITEC 2014 were These results reveal that a signifi- nity only represents a portion of the given a demonstration of Google cant number of consumers are famil- Explorers in the program. According Glass and a research survey was iar with smartglass wearables, namely to Sacco (2014) of CIO Magazine, conducted to explore consumer Glass, and are willing to try, use and an “admittedly unscientific” estimate intentions to use and buy wear- buy them, if available. However, the of 10,000 Glass units were sold ables. The results of this study are respondents gave five main reasons in 2012, and the program creators available online at The Bottomline why they wouldn’t be interested in predicted they might have as many magazine, Winter 2015 issue, “Are Glass and wouldn’t buy it: as 40,000 official users by the end of You Ready for Wearables” article • Cost of the device; 2013. All totaled, it can be guess- by Aluri (2015). • Glassware apps were not personal- timated that there may be around As a Glass Explorer and re- ized enough or didn’t offer features 300,000 Glass Explorers in the pro- searcher in wearable technology, I beyond familiar mobile apps; gram. On January 15, 2015, Google surveyed 708 respondents between • Battery life of the device; notified its Glass explorers that they March and November 2014. I asked • Not personally interested or were closing the Explorer program individuals about their preferences uncomfortable using Glass wear- on January 19. Several news chan- and intentions to use Glass, and here ables; and nels and magazines, as well as the are a few things I learned: • Privacy concerns.
20 HITEC 2015 Special Report Wearable Technology
Going Mainstream? enough that users are comfortable able computer that runs Windows When it comes to wearable comput- wearing them everywhere. One 10, at the Build 2015 Conference. ing, especially smartglasses, there is possible solution for overcoming Now that it is an open competition, hope. Consumers are willing to try privacy and security concerns about wearable smartglasses that can meet and even buy the devices, but only wearables, especially smartglasses, the everyday needs of the consumer if they meet their specifications. is a call for universal standards or may come from existing companies Regarding costs, wearables can be laws to guide businesses that manu- like AtheerOne, Aurasma, CastAR, designed with multiple price points, facture wearables. EmoPulse, HoloLens, some future each with different battery life and Google provided an opportunity model of Google Glass, GlassUp, memory options, so consumers can to examine consumer behavior Icis, K-Glass, Laster Seethru, Magic buy them based on their usage and regarding the use of wearables, Leap, Oculus, Ora-S, OrCam, Meta, budget. The challenges with wear- which allowed both consumers and Vuzix, or perhaps a new company able batteries continue to diminish businesses to pinpoint their con- we have yet to see. It will also be as researchers make breakthroughs cerns regarding Glass and develop interesting to observe whether Ap- in nanotechnology that will phase ethical and legal solutions to these ple Watch and other smart watches out the lithium-polymer batteries in problems. Looking ahead, the will change the future of smartglass the market today. Several start-ups market for general and daily use wearables. Wearable technology is in the wearable industry are already wearable smartglasses is now open, here, and it will continue to draw at- offering alpha and beta versions of and several sources have predicted tention to itself in the market, until their own devices. The results of that wearable computing will be a the right technology and device this study reveal that smartglasses huge market. This May, Microsoft emerges that will improve the way should be fascinating, comfortable to showcased its new wearable device, we compute and use technology use and the design should be subtle HoloLens, a holographic wear- every day.
Sources • Adams, A. and Koenig, P. (2014). • Gownder, J. P. and McQuivey, J. • Slice Intelligence. (2015). First The Size of the Smartwatch Mar- L. (2014). Wearables a Priority Apple Watch Data: One Just Isn’t ket and Its Key Players. Retrieved for 68 Percent Percent of Global Enough. Retrieved April 2015 from online from http://www.forbes. Tech and Business Decision- http://intelligence.slice.com/first- com/sites/arieladams/2014/03/07/ makers. Retrieved January 2015 apple-watch-data-one-just-isnt- the-size-of-the-smartwatch-mar- from https://www.forrester.com/ enough/. ket-its-key-players/. WearablesAPriorityFor68Percen- • Smartwatch Group. (2015). Top • Aluri, A. (2015). Are You Ready for tOfGlobalTechAndBusinessDe- 10 Smartwatch Companies 2014 Wearables? The Bottomline Win- cisionMakers/-/E-PRE7464 (Sales). Retrieved April 2015 from ter 2015. Available online at http:// • PricewaterhouseCoopers. (2014). http://www.smartwatchgroup. www.hftp.org/education_resourc- The Wearable Future: Consumer com/top-10-smartwatch-compa- es/the_bottomline/. Intelligence Series. Retrieved nies-sales-2014/. • Gartner. (2014). Competitive January 2015 from http://www. • Tibken, S. (2015). How well is the Landscape: Smartwatches and pwc.com/cis. Apple Watch selling? Tim Cook Smart Wristbands, Worldwide, • Sacco, A. (2014). How Many remains mum. Retrieved May 2015 2014. Retrieved March 2015 from People Actually Own Google from http://www.cnet.com/news/ http://www.gartner.com/docu- Glass? Retrieved November 2014 how-well-did-the-apple-watch- ment/2847117. from http://www.cio.com/ar- sell-tim-cook-remains-mum/. • Gibbs, S. (2013). Samsung: The ticle/2369965/consumer-technol- Galaxy Gear Smartwatch is ogy/how-many-people-actually- Like Unripened Fruit. Retrieved own-google-glass-.html. on January 2014 from http:// www.theguardian.com/technol- ogy/2013/nov/19/samsung-galaxy- gear-smartwatch-tomato.
HITEC 2015 Special Report 21 TECH TRENDS Robotics
The Rise of Robotics in Hospitality
ome may think the title of By Galen Collins, Ph.D. this article is an oxymoron. SHow could robots replace the warmth and personal attention from well-trained employees? And why Increased functionality and declining costs raise would hospitality businesses even the appeal for service-oriented robots contemplate pursuing this course of action? Because robots have the capability of performing basic, repetitive tasks unsupervised 24 hours per day in a world with an inadequate workforce. A 2015 World Travel & Tourism Report predicts a decade-long global shortage of “the right people, in the right place, with the right skills” to meet the growth of the global travel and tourism industry, which roughly employs 266 million workers. Perhaps robots could be part of the solution in fill- ing the workforce gap. Robots have a come a long way since the first digitally operated and programmable robot, invented by George Devol in 1954, was installed in 1961 in an auto plant in Trenton, N.J. to lift hot pieces of metal from a die casting machine and stack them. Robots can now take inputs from on- board sensors (e.g., camera, sound, proximity, biometric, contact, light, temperature, navigation, etc.) and send outputs to the their effectors (e.g., wheels, speech, legs, arms, fin- gers, propellers, etc.), enabling them to perform behaviors or tasks with a high degree of autonomy. They can move and work for an extended period without human intervention and assistance. They can also gain information about the environment,
Galen Collins, Ph.D. ([email protected]) is a professor at the School of Hotel & Restaurant Management at Northern Arizona University in Flagstaff, Ariz.
22 HITEC 2015 Special Report Robotics interact with people and systems, the gestures of Roberto Bolle, princi- sity. In the increasingly competitive manipulate objects and tools, and lo- pal dancer with the American Ballet healthcare environment, hundreds of cate and connect to charging stations. Theater, periodically go into dance hospitals are using robots to deliver One way of characterizing robot mode when not making drinks. linens and medications to patients’ design is by appearance: human ori- At Starwood’s Aloft hotel in rooms. Thoughtfully designed robot ented or product-oriented. A human- Cupertino, Calif., a product-oriented systems, however, will be required oriented robot resembles a human’s robot resembling R2-D2 delivers for service environments where appearance or behavior, whereas a items to rooms (e.g., snacks), aids customers may not even know what product-oriented robot appearance the check-in process during rush robots are and what they are trying maximizes the robot’s dedicated periods, and moves towels and linens to do, says Chris Jones, director of functions (e.g., Roomba vacuum from the laundry room to guest- strategic development at iRobot. cleaner). Several studies have shown rooms. The robot, called Botlr, uses that the human-oriented robot is navigation technology to find its way Robot Challenges more effective in social interactions throughout the property and cameras Challenging problems in human- with customers. However, a 2014 to avoid people and other obstacles. robot interaction (HRI) exist, both study conducted by Korean univer- The manufacturer of Botlr, Savioke, technically and socially. The goal sity researchers found that product- will offer it as a service and charge of HRI research is to define models oriented robots were accepted more a monthly fee that includes mainte- of humans’ expectations regard- than the human-oriented robots. nance of the devices. ing robot interaction to guide robot Customers may initially perceive In most industries, robots are design and algorithmic development robots as an impersonal technocratic being recruited for applications that that would allow more natural and intrusion, much like they did when have generally been performed by effective interaction between humans wireless handhelds were first intro- humans because of their increased and robots. Socially interactive duced in restaurants during the '70s functionality and the declining cost human-oriented robots, for example, and '80s. The public did not accept of making and supporting them. A must be proficient in areas such as them. At some restaurants, servers 2015 study by the Boston Consult- perceiving and interpreting human were instructed to step away because ing Group predicts that over the next activity and behavior, regulating so- of customer complaints. decade robots will become more cial interactions using dialogue and prominent in the U.S. labor market action at human interaction rates, Robots in the Field as they improve productivity and cut and providing informationally and Huis Ten Bosch, a theme park in costs. The Asian hospitality industry emotionally responsive feedback. Japan, will open a hotel in 2017 is already taking advantage of this It is clear that robots are about to employing three human-oriented trend. Thousands of noodle-making do much more than pickup dust and receptionist robots, called actroids, robots have been purchased by dirt particles. Hospitality businesses that will have the appearance and restaurants in China. A number of around the world are beginning to mannerisms (e.g., blinking) of a restaurants in Singapore use drones, dip their toes in new robotic tech- young Japanese woman. They will pilotless flying robots, to ferry food nologies, which might not make be multilingual with the ability to from the kitchen to serving sta- sense for those positions that deliver make eye contact and respond to tions. Robot servers, costing under highly personalized services. body language and tone as they $10,000, can be found waiting tables Many believe that affordable ro- engage in intelligent conversations at restaurants in China, Japan, South bots will soon be able tackle an array with customers. The hotel will also Korea and Thailand. A restaurant of tasks with greater degrees of au- use other human-oriented robots for located in Ninbo, a city in China’s tonomy and intelligence. This trend other tasks, such as cleaning rooms northeastern Zhejiang province, is is obvious to Google who bought and carrying luggage. staffed with two robot servers that eight robotics companies in 2013. Two product-oriented, headless can take orders, serve food, and While there have been significant ad- industrial robots, originally devel- speak to customers with a 40-phrase vances in robotic technologies, there oped for manufacturing cars, are Mandarin Chinese vocabulary (e.g., is still much work ahead. Experts now used as bartenders at the Bionic “enjoy your meal,” “I’m blocked, agree that we have a long way to go Bar on Royal Caribbean’s Quantum please give way to me, thank you”). before robots are omnipresent in ser- of the Seas ship. Together, they They travel through the restaurant vice establishments. But I can imag- can make two drinks per minute, using an optical sensing system and ine the possibilities, such as robotic delivered in plastic cups via four can work for eight hours at a time. drones taking orders and delivering conveyor belts, but cannot yet handle Their expected life span is five years. food and drinks beachside or roving garnishes. Passengers input drink The hospitality and travel indus- security robots taking lost guests to orders via smart tablets. The robot try may eventually find the deploy- their rooms, detecting and reporting arm movements, which are based on ment of robots a competitive neces- intruders, and saving lives.
HITEC 2015 Special Report 23 TECH TRENDS Mobile Payments
Are Mobile Payments (R)evolutionary?
ctober 1 or 10.1. A date that By Cristian Morosan, Ph.D. and Agnes DeFranco, Ed.D., CHAE seems predestined for infor- Omation technology, given its binary flavor. This is the date by The convenience of the one-size-fits-all model of which most merchants in the United States will eventually change their mobile payment using near field communication point-of-sale terminals to accommo- poses to eclipse other payment options date a new generation of electronic payments or be liable for fraud. The change is long-awaited. Most cards currently in use in the United States are based on a technology that stores information on a magnetic strip located on the back of the card, and many consider them obsolete. The change is a necessary step toward more secure electronic payments. Most civilized countries have already adopted secure electronic payments, facilitating large-scale consumer adoption of payment cards that include a microchip associ- ated with either a pin or a signature. The microchip communicates with the point-of-sale terminal using an unique transaction code, which is supposed to make the transaction more secure. Additionally, there are proximity or near field communi- cation (NFC) cards, which do not require the insertion or swipe of the card, but rather placing the card in the proximity of a reader to initiate the payment process. It is now the turn for the United States to show whether its consumers and mer- chants are ready to adopt the newer generation of electronic payments. At the time of this writing, many merchants have already deployed
Agnes DeFranco, Ed.D., CHAE ([email protected]) is a distinguished chair and professor at the Conrad N. Hilton College of Hotel & Restau- rant Management, University of Houston. She is also an HFTP Global Past President, chair of the HFTP Global Hospitality Accounting Common Practices Advisory Council and a recipient of the HFTP Paragon Award. Cristian Morosan, Ph.D. ([email protected]) is an assistant professor at the Conrad N. Hilton College of Hotel & Restaurant Management, University of Houston and vice chair of the CHTP Advisory Council.
24 HITEC 2015 Special Report Mobile Payments
new point-of-sale terminals capable of handling chip- and NFC-based cards. In anticipation of the Oc- " Such wealth of information facilitates all of the phases of purchasing, that tober deadline, many card issuers is, from reading reviews about a certain merchant, finding that merchant have started to gradually offer their and paying for the merchant’s products by using one single device." consumers such cards. Overall, the shifting of the cards seems to be an attractive proposition to consumers ness, represent two major conditions that today’s mobile phones are not and merchants alike, as both will for technology adoption, the world only viewed as technology devices greatly benefit from the more secure of mobile payments was still waiting per se, but rather as extensions of transaction environment. However, for something that addressed not one’s self in the digital world. even with increased security as an only these two requirements, but also Because they can store and easily invaluable commodity, in reality a added a touch of fun and excitement exchange personalized information, card will replace another card. Thus, to the technology utilization. This is today’s mobile phones represent some may argue that this change is what leads to the initial popularity of very attractive digital companions not revolutionary, but rather evolu- NFC mobile payments, which fit all for consumers. tionary. That is, consumers will still the conditions to be largely adopted Another important factor that have to carry their wallets full of in the United States. could facilitate the role of the mobile plastic when they go to a hotel, gas NFC mobile payments use device in the payment ecosystem station or grocery store, and the card two-way communications between is the availability of the myriad of may still leave their sight when they devices that are equipped with NFC structured informational pieces that pay in restaurants. So, is the United chips. In the United States, there are taken together describe the dense States electronic payment ecosystem currently a number of mobile phones and fragmented hospitality indus- ready for a revolutionary change? equipped with NFC technology, try. Especially when consumers We believe that it is. allowing consumers to use them as are on the road, in hotels, airports, payment devices. The mass adop- etc., their mobile phones can give A Switch to NFC tion of such devices is predicated them unprecedented, fast access to Enter mobile payments. For quite a upon some very interesting dynam- products and experiences that would while, mobile technology companies ics. First, to ensure that the basic be difficult to find in the absence have flirted with the idea of mobile conditions for adoption are met, the of optimized search and fulfillment phone payment. This idea could device, the carrier, the app devel- tools as the ones provided by the not have been implemented unless oper and the merchant receiving the mobile phones. Such wealth of in- there were mobile phones capable payment have to be all on the same formation facilitates all of the phases of handling steady connections to page. All participants to this ecosys- of purchasing, that is, from reading the Internet and providing oppor- tem must be performing properly, or reviews about a certain merchant, tunities to consumers to view such weaknesses in the value chain could finding that merchant and paying hardware as replacements for their be created. In addition, to facilitate for the merchant’s products by us- bigger relatives, the computers. Yet, adoption, the whole ecosystem ing one single device. As the NFC what truly differentiates the mobile must be easy and entertaining to phones provides unique opportuni- payments from the rival electronic use. Although the full ecosystem is ties to help consumers smooth their payments is that consumers can responsible for this, the most visible pre- and post-payment activities, combine the mobility and ubiquity element ensuring user-friendliness they represent convenient alterna- benefits of the mobile phones with and entertainment value remains the tives to all rival payment methods the user-friendliness of the online payment app. The success of apps currently available in the United payment environment. At one point, like Apple Pay is largely attributable States. Such qualities can actually a major barrier was the size of the to their excellent user friendliness put NFC mobile phones in a central screen, as most early smartphones and entertainment value. position within the next generation capable of pay via the mobile Web There are some other advan- of electronic payments in hospitality, were limited to providing surrogate tages offered by the NFC phones as they can completely eliminate that payment solutions, which were not that could revolutionize the mobile need for rival payment systems and really convenient for consumers. As payments in the United States. One can offer unprecedented levels of user friendliness, along with useful- important advantage reflects the fact value to hospitality consumers.
HITEC 2015 Special Report 25 TECH TRENDS Payment Technology
Why EMV Shouldn’t Scare Hoteliers
MV is coming. Don’t panic. By Steve Sommers By the time we all meet togeth- Eer at HITEC, we will be just four months away from the October The push to shift to EMV-capable terminals is an 2015 liability shift date for retailers in the United States if EMV (or Eu- opportunity to switch to more secure systems, ropay, MasterCard and Visa) is not including point-to-point-encryption and tokenization supported. After that date, which- ever organization “breaks the EMV chain” will be held responsible for fraudulent card activity that could have been prevented had they sup- ported EMV. In practical terms, that means the liability for fraud could shift to the banks if they do not offer chip-embedded smart cards to their merchants, or to the processor if they are not certified to receive the EMV transaction. Of course, it also means it could shift directly to the hotel if all other players are EMV ready, but the property could not process the transaction through a certified EMV terminal. Before you panic and rush to im- plement an incomplete or insecure EMV solution, consider this: the EMV liability shift will likely have very little effect on the U.S. lodging market. What do I mean by that? The liability shift will effectively eliminate a business’ ability to fight chargebacks and will make them liable for a very specific subset of fraudulent card use. How much fraud and how many chargebacks does your property see today? It’s likely not very much. Recently, one large hotel chain ran the numbers to identify their potential liability exposure and realized their existing
Steve Sommers is senior vice president of applications development for Shift4 Corp. based in Las Vegas, Nev.
26 HITEC 2015 Special Report Payment Technology
fraud and chargeback rate was only 0.03 percent. To put a dollar amount to that figure, the chain in question " As you are implementing P2PE and adding terminals capable of would have spent close to a million encryption at the swipe, simply choose one that also supports EMV, dollars to purchase and install new EMV-capable terminals in order allowing those benefits to come as an afterthought of your real mission: to avoid an annual fraud loss that securing your customers’ card data." was in the low tens of thousands. If avoiding liability is your only reason to adopt EMV, it may take decades for the decision to make tion, “What’s in it for me?” The And, if we’re totally candid, most financial sense. answer is two-fold. First, there will of the EMV terminals on the market be many significant consumer- today actually send clear-text card Why Should You Support EMV? education programs undertaken by data out of the back end and into the To honestly answer the “why” ques- card-issuing banks as they begin to point-of-sale or property manage- tion, we have to look at what EMV disseminate EMV cards. They will ment system — making those will actually accomplish. In contrast talk about added security and fraud systems an even bigger target for to media reports following the Target prevention, and guests may begin to hackers than they likely are today. and Home Depot breaches, EMV question the security of organiza- Before worrying too much about will not stop hackers in their tracks, tions that opt not to support EMV EMV, make sure your system sup- nor prevent the types of breaches immediately. Sure, we could explain ports strong security solutions like that affected dozens of major busi- to them that even criminals aren’t P2PE, which encrypts card data the nesses (in both retail and hospitality) dumb enough to use a stolen card moment it enters the hotel’s systems, over the past two years. So what to alert police to where they plan to and tokenization, which provides will it do? EMV was designed to sleep that night, but perception is for secure long-term storage of authenticate the card itself and to reality and if you’re the last property card data. As you are implementing reduce card-present fraud. And that’s in town to move to the new secure P2PE and adding terminals capable exactly what it does. Almost all the credit card machines they’ve been of encryption at the swipe, simply security claims beyond that are exag- hearing about, people will notice — choose one that also supports EMV, gerated marketing efforts. even subconsciously. allowing those benefits to come as So, why should hotels with Second, the groundswell behind an afterthought of your real mission: relatively low fraud rates spend EMV gives those of us who are securing your customers’ card data. significant resources to upgrade to security-minded a perfect opportu- In the words of Ingenico’s vice EMV-capable terminals? For one nity to not only upgrade our payment president of security solutions, Rob simple reason: so long as we still devices to support EMV, but also to Martin, “EMV protects you from the have magnetic stripes on the back of support point-to-point encryption fraud that’s already taken place. P2PE our cards, our cards remain vulner- (P2PE), which will actually prevent and tokenization protect you from able. To see the true benefit of EMV the types of breaches we’ve seen becoming the source of new fraud.” in preventing fraudulent card use, over the last 18 months. Merchants When we look at the EMV migra- we need the EMV “chip” method to should realize that EMV alone will tion as an opportunity to reevaluate become universal. not stop breaches, and while it will our entire credit card environment make it harder to use stolen card data and to take long-overdue steps What’s In It For Me? in physical stores, it cannot prevent toward true security, it becomes a That brings us to the age-old ques- the use of fraudulent data online. benefit for us all.
HITEC 2015 Special Report 27 TECH TRENDS Wi-Fi Networking
Engaging the Guest through Innovative Wi-Fi Technology
magine you’re at a casino playing By Monica Compton at the craps table. You’ve decided Ithe game is no longer going in your favor and you get up from the A behind-the-scenes look at Caesars Entertainment's table. A message suddenly pops up on your smartphone giving you $25 Wi-Fi upgrade deployment, built to support guests' worth of free tokens to be used in the bandwidth demands and mobile operations next two hours. Or suppose you’re just standing at the table watching. You’re not very good at craps and need more prac- tice. A message is delivered to your smartphone giving you a free tutorial on how to play the game. After this, you are more inclined to play. Using Wi-Fi data to track, en- hance and engage the customer is no longer a fantasy. For many hotels, this technology is a necessity to create customer loyalty and repeat stays. For Caesars Entertainment, the importance of improved Wi-Fi service was paramount to delivering a favorable guest experience. “We needed a system that not only provides bandwidth to our cus- tomers, but also one that enabled our business operations to go mobile,” says Scot Campbell, CHTP vice president of connectivity and com- munications for Caesars Entertain- ment Corporation. “This allows our employees to bring superior cus- tomer service right to our customers wherever they are in the hotel.” Thus began the monumental project of installing data and Wi-Fi service to 42,000 rooms in 40 of Caesars’ U.S. properties encompass- ing 40 million sq. ft. and requiring
Monica Compton ([email protected]) is a writer and event marketing consultant for Pinnacle Productions.
28 HITEC 2015 Special Report Wi-Fi Networking
just under 50,000 access points. The resort have seamless access to the The LBS technology allows coverage would include guest rooms, Wi-Fi network, but hotel employees hotels to guide guests to the right all front-of-house and back-of-house throughout its back office operations place at the right time. For example, locations, and indoor/outdoor space. would also be able to connect to the Caesars can locate a guest who is The result would be the largest, wireless system. waiting in the buffet line and give single-provider Wi-Fi network in the “By installing this ‘personal Wi- them an offer to get them out to the gaming-resort industry. Fi’ system which includes an access casino where they would spend more “The project timeline to install all point in every guest room, our cus- money. “If they are in the middle of of this was 24 months or less,” says tomers not only benefit from great a fine dining experience, they are John Fountain, director of network bandwidth, but in the future will be spending money and we wouldn’t technology for Cox Business/Hos- able to communicate with numerous want to draw them away,” Gagné pitality Network, the company that devices in their room (television, says. “When they are close to des- installed the service. “We ran into sound systems, etc.),” Campbell sert, the Total Rewards app might unexpected challenges such as the says. “This enabling technology is send them a $50 gift certificate to appearance of physical infrastructure what customers will soon consider a spend in the casino.” issues like power and air condition- requirement for their hotel stay.” According to Gagné, Caesars’ ing capacity.” Recall the scenario with the craps new LINQ Hotel was experiencing Perhaps the biggest challenge was table and the ability to track custom- some difficulty in getting guests far room access and the ability to install er preferences. Cox Business/Hospi- enough down the walkway that led the service without interrupting hotel tality Network deployed a customer to the High Roller — “the world’s operations and the guest experience. envisioned, highly secure platform to tallest observation wheel” — so “Room access is difficult if the deliver this useful marketing infor- they could sell more cars on the guest is in the room,” says David mation in order to improve Caesars’ ride. The LBS analytics allowed Gagné, vice president of wireless and bottom line. Caesars to see how much traffic services for Zebra, formally Motoro- “We implemented location-based they were getting and which paths la which provided the hardware and services (LBS) and Wi-Fi security guests were taking through the ho- physical deployment for the instal- using Zebra’s AirDefense Services tel. They then added regional shops lation. “We managed to get 1,000 to Platform for security and their 6500, and street performers to the walk- 2,000 rooms installed in one week.” 7500 series APs to deliver advanced way which directed more people to Yet staying on this timeline was Wi-Fi,” Fountain says. “Addition- the attraction. not easy. The logistics for getting ally, all Cisco elements are redun- Customer experience is then materials into the hotel was formi- dant to the greatest extent possible improved in all areas, from Wi-Fi dable. According to Fountain, the ensuring high network availability as connectivity in each guest room to number of network elements, cables needed in a demanding hospitality preferences in dining, gaming, enter- to be installed and end devices was setting.” tainment and overall hotel offerings. very high. “It required coordination And for the guest, all of this Wi- “Over the long term, Caesars En- of purchasing thousands of devices Fi is free. Guests can choose to buy a tertainment will be able to increase for a single hotel, landing them at a premium package for video stream- the Internet speed offerings while staging facility, building the entire ing, but standard service is included simultaneously leveraging location network in that facility, tearing it in the hotel rate for in-room service information to better serve guests,” down, packaging, shipping to the and in all public areas. How then can says Fountain. hotel, unpacking, installing and providing complimentary service im- Savvy travelers have high ex- verifying operations while creating prove the hotel’s bottom line? “The pectations when it comes to their limited interference with guest and payback is being able to engage the technology needs. The ability to use hotel operations,” Fountain says. customer which creates revenue and their devices anywhere in the resort loyalty,” Gagné says. and get rewarded by LBS, elevates Building a Wi-Fi Network Zebra triangulates the signal their stay far beyond what they can Cox Business/Hospitality Network through Wi-Fi and passes the data to get at home. brought in Cisco gear for network Caesars’ analytics department. The “Our goal was to seamlessly transport and leveraged Wi-Fi access hotel then decides what to do with the integrate technology to create an points using the 802.11n family of data and where to take the guest. “By exceptional guest experience,” says wireless standards, as well as the tying the data to their Total Rewards Derrick Hill, vice president of Cox 802.11ac specification that provides loyalty program they can learn who Business and Hospitality Network. the fastest Wi-Fi speeds currently their customer is and can provide “The Caesars Wi-Fi deployment available. Not only would hotel consistency of service, especially represents the future trend in the guests in all public areas of a given through franchises,” Gagné says. hospitality industry.”
HITEC 2015 Special Report 29 TECH TRENDS Mobile
Managing With Mobile Tools
obile technology is transform- By Mark Heymann ing the way we live and work. MIn a world that has grown increasingly reliant on, and em- Management utilities designed for mobile media powered by, such technology, 2015 marks a tipping point. Millennials — bring the command center out from behind the the first generation of digital natives — have become the largest percent- desk and immerse it within the action age of the workforce. This new majority is accustomed to a world of instant information and tech-driven communication. Hotels and restaurants are in- creasingly adopting mobile tools to not only help with more real time decision-making, but also to help them manage their workforces with greater agility, leading to better pro- ductivity and efficiency, employee engagement and guest satisfaction. And these same tools are satisfying the needs of their app-savvy, millen- nial workforce, who are less inter- ested in traditional career paths and more in pursuing work-life balance. So what does this mean for the culture of an organization? In a dynamic world of free-flowing information and real-time com- munication, does the conventional “command and control” manage- ment model, which is already show- ing signs of wear, still have a place? Or does today’s successful manager require a different skill set?
Managing on the Move Traditionally, the manager’s com- mand center was his or her desk, where part of the work day was spent analyzing information (keep-
Mark Heymann is a founding partner, chairman and CEO of Unifocus based in Carrollton, Texas.
30 HITEC 2015 Special Report Mobile Management
ing it close to the vest), correcting time cards, planning shifts and measuring performance. Employee " Mobile combined with an effective service delivery system keeps feedback was dispensed at scheduled real-time, accurate information regarding service demand and staff performance reviews or with an an- availability at the managers’ fingertips, making it possible for them to nual survey. In today’s streamlined service deploy more resources or scale back shifts as a situation unfolds. " industry, managers are constantly on the move, cultivating relation- ships and responding to guest needs managers communicate and share starts? Likewise, today’s service and staff issues as they occur. And information in real time, has funda- manager is presented with a constant the command center moves with mentally changed the way these two barrage of real-time information that them — in the form of a smartphone parties interact. requires him or her to monitor and or other mobile device that puts an Looking forward, at some point respond to changing circumstances. unprecedented amount of real-time the employee will be fully tuned in While yesterday’s desk-bound man- information at their fingertips. to the general performance metrics agers held information close, mobile of the business and will be part of the managers can share information and Agility, Flexibility and Collaboration real-time process to improve results. knowledge freely. Sit-down perfor- Mobile dashboards on their devices mance reviews are replaced with give managers the ability to evalu- Driving ROI on-the-spot feedback that enables ate overall performance, revenue, Mobile combined with an effective employees to learn and adjust as quality and costs while on the go. service delivery system keeps real- they go. The skill set required of a These same devices can be used to time, accurate information regarding manager, therefore, is beginning to approve scheduling requests, shift service demand and staff availability align more with those of a coach. resources according to real-time at the managers’ fingertips, mak- demand and monitor staffing issues. ing it possible for them to deploy Looking Ahead They can receive automatic alerts more resources or scale back shifts As mobile becomes ever more ubiq- for everything from late clock-ins as a situation unfolds. Managers uitous in the workplace, it is chang- to workers who are approaching armed with such tools can determine ing the dynamic of how managers overtime to absenteeism. By add- quickly not only how much staff and employees interact. The pres- ing survey tools that gauge guest is needed to meet guest demand sure to operate lean and optimize satisfaction and employee engage- at a particular time, but what skill costs with the increase in wage rates ment, managers can identify and level is required and how to best combined with the millennial major- address the root cause of issues that execute the plan. Accurate, real-time ity’s non-traditional career mindset, ultimately impact the bottom line. measurement of results allows them is spurring a freelance economy that Customizable dashboard features to adjust and continuously improve will afford more workers the flex- allow managers to track the metrics strategy, which can lead to signifi- ibility to work for multiple employ- that are most critical to them, which cant ROI growth. ers and choose their own schedules. better enable them to advance a plan The use of mobile tools has a We’re already seeing this shift in and get ahead of the curve. measurable impact on the engagement certain markets. Companies that have That same technology is avail- level of the staff, which converts to adopted mobile workforce manage- able to their employees on their own hard bottom line impact. A study of ment technology are finding that their mobile devices. Currently, it empow- 11 hotels using UniFocus’ Total Work- managers and employees embrace it ers them to review and manage their force Performance Solution shows in very quickly. And as they do so, there own schedules from any location at excess of a five to one return within is an organic shift in the way they any time. They can negotiate shift the first year of implementation. approach their positions. Moving for- changes with other employees, ward, it will be interesting to see how request time off and create a more Manager or Coach? this affects the way managers are de- flexible, less traditional schedule that A baseball coach goes into the veloped, the skill set a hotel company fosters the work-life balance they dugout with a game plan, but is he expects of its management team, and seek. The collaborative nature of prepared to adjust that strategy on how those managers perceive their this process, through which staff and a play-by-play basis once the game own roles.
HITEC 2015 Special Report 31 TECH TRENDS Legal Issues
Steps to a Proper Litigation Hold
y now, most lawyers are, or By Daniel Vecchio and Don Scaramastra should be, familiar with the Brequirement to preserve poten- tially relevant evidence as soon as Plan ahead for potential litigation with prepared a lawsuit is reasonably anticipated. Implementation of an effective “liti- guidelines on preserving electronic documentation gation hold” to preserve evidence can be challenging, particularly in the fragmented business environ- ments that are commonplace in the hospitality industry. So long as hoteliers plan ahead for preserva- tion and document the steps they take, however, they are unlikely to be faced with the problems that can arise from an ineffective hold.
Have a Plan Before the Need for a Litigation Hold Arises If the first time you think about how to implement a litigation hold is when you actually need to imple- ment one, you have come a bit late to the party. This is a bit akin to going shopping for your earthquake kit after the ground has begun to shake. Unless carefully planned, a hold may prevent employees from accessing documents they need to do their jobs, such as contract templates and database information. Make sure your IT personnel have thought through the logistics of a hold. Identify the types of docu- ments you have and record where and how they are kept. In addition to the usual suspects (e-mails, Word documents, Excel spreadsheets and the like), you must be aware of rapidly-developing technology
Daniel Vecchio ([email protected]) is an attorney with Garvey Schubert Barer based in Seattle, Wash. Don Scaramastra (DScaramastra@gsblaw. com) is an attorney with Garvey Schubert Barer based in Seattle, Wash.
32 HITEC 2015 Special Report Legal Issues
and how your employees use it. Do employees use text messages to relay " Make sure your IT personnel have thought through the logistics of a information? Does the hotel provide hold. Identify the types of documents you have and record where and customer service online via real-time how they are kept… Once you have identified the data, your IT specialists chat? What about online reservation should plan in advance for how they can preserve these documents systems? All of these systems may contain data that will need to be pre- without disrupting the business if the need arises. " served. Once you have identified the data, your IT specialists should plan but they also want to issue one Potentially relevant data could reside in advance for how they can preserve that clearly explains what must be with the hotel owner, operator and/or these documents without disrupting preserved. The two goals are often in the franchisor. Suppose, for example, the business if the need arises. tension, but don’t delay while trying that the litigation involves a dispute to find the perfect balance: you can between a hotel in Albuquerque, Think About How Things Will Look in always supplement your initial hold N.M. and one of its vendors. Per- Hindsight notice with a more detailed one later. haps all of the pertinent electronic A litigation hold is required when documents will be found on the an event puts the hotel on notice that No Two Holds Are Exactly Alike computers in Albuquerque. But more litigation may be imminent. Some There is a temptation to look for a and more, documents are stored on triggering events — for example, a one-size-fits-all approach to litiga- servers located far away from the ac- letter from a guest’s lawyer threaten- tion holds that will make it easier to tual place of business — perhaps on ing to sue — may be obvious. But “automate” the implementation of the hotel operator’s central server, or others may not be. A disagreement one. Unfortunately, hoteliers face all perhaps even in another country. Em- between a franchisor and one of its manner of litigation large and small, ployees who work remotely also may franchise owners, a breakdown in and not every hold will be the same. store relevant evidence on their home negotiations between a hotel and its Electronic documents relevant to an computers. Key vendors may also vendor, or an employee complain- employee grievance may be wholly have relevant documents, particularly ing about being passed over for different from those relevant to a as more hotels look to cloud-based promotion all might — or might large antitrust class action. If you service providers to manage their not — signal that litigation is on the have planned in advance (see point electronic data needs. Don’t forget to horizon. Hotels must recognize that one above), you should be in good look outside your office. what looks unlikely in prospect may position to translate this effort into a seem inevitable in retrospect. Hind- simple, effective hold. Document What You Did and Why, sight is, indeed, 20/20. If you think a When You Decide to Do It particular situation is unlikely to lead Find Out Who Has Relevant Informa- Once you have properly put a litiga- to litigation, write down the rea- tion and Who Can Alter Your Data tion hold into effect, there is one sons you think so and run them by Who should be instructed to preserve final issue to address: how will you someone whose opinion you trust. evidence? You should issue a hold prove, or remember, what you did Remember: one day you may have to notice to all individuals who are to implement the hold? The key is explain why you didn’t issue a hold. central to the events at issue in the to contemporaneously document all You’d better see if that explanation lawsuit or who have the capacity to decisions made and all steps taken holds up now, before someone chal- delete or alter relevant documents. to implement the hold. So long as lenges your failure to act. Don’t forget the latter category, you have acted in good faith, judges which can include IT staff, ad- are unlikely to sanction you if you Keep Your Hold Notice Plain, Simple ministrative staff and recipients of can clearly document and explain and Clear courtesy copies of relevant commu- what you did and why. But if you Once you decide to implement a nications. are unable to do so, or if your later hold, you will almost certainly issue statements about what you did are one or more written “hold notices” Find Out Where the Relevant inconsistent with what you actually to affected parties to inform them Information is Kept did, do not expect much sympathy that a hold is in place. Businesses In the hotel business environment, it from the court. As in so many things, often find themselves in a bind: is not safe to assume that all relevant an ounce of prevention is worth a they want to issue a notice quickly, documents will be stored locally. pound of cure.
HITEC 2015 Special Report 33 TECH TRENDS Strategic Planning
Building a Strong Business Case
his article is all about the con- By Mark Haley, CHTP, ISHC cept of the business plan. First, Twe will review what a business plan is, why one might need one and A guide to outlining a clear statement of objectives when you would write one. Then we will discuss elements common to and the strategies for achieving them most business plans.
What, Why and When A business plan consists of a clear statement of objectives and the strategies by which one will achieve the objective. It must include at least an enumeration of costs and revenues. A more formal one will include a complete budget, while a prospectus (a legal form of busi- ness plan for investors in securities or other regulated investments) will usually include a set of pro forma financial statements. The business plan must include a time element and should explain the marketing, sales and communications efforts required. Most business initiatives require people to make them happen, so the plan must identify who is going to do what. If other assets are required, those should be identified in the business plan also. Finally, the business plan should state possible risks to the plan and how these risks can be avoided or mitigated. A business plan can be a formal document, perhaps even registered with a regulatory body (like the Securities Exchange Commis- sion), or could be a brief, informal document for internal purposes only. Or anywhere in between these extremes. Part of the author’s job is
Mark Haley, CHTP, ISHC ([email protected]) is managing partner of The Prism Partnership, LLC based in Boston, Mass., a boutique consultancy servicing the global hospitality industry at the intersection of technology and marketing.
34 HITEC 2015 Special Report
Strategic Planning
determining the proper level of detail and formality for In this case, the strategies are low cost and to capital- the proposed initiative and the intended audience. A busi- ize on high demand due to weather and foot traffic. A key ness plan serves two primary purposes. strategy for an outsourcing initiative might be to: ensure 1. Convince someone else to invest in or otherwise sup- guest service with contractual obligations for hours, but port a business initiative: make the concessionaire responsible for labor cost fluc- The initiative could be to start a hotel company, tuation due to changing occupancy levels. take some lobby space for a new F&B outlet or to replace a proprietary central reservations system How will the girls measure their success? with an outsourced third party solution; in short any business initiative. Key Performance Indicators 2. Tell the leaders of the initiative whether or not they are We need to raise $10, so sales is the most important on track to meet their objectives: measure, especially since we have mix, water and ice After all, if you don’t know where you are go- for free. We should also measure what we drink as Lost ing, how do you know when you got there? Revenue.
You will invest the time and effort to write a business These measures are Key Performance Indicators plan when you want to convince others to invest in or oth- (KPIs) indeed! If we are moving from a proprietary CRS erwise support your initiative. These others might be third to a third-party one, perhaps a KPI is: Total Cost Per Net party investors that you are selling equity in your com- Reservation. If a reason to move to an outsourced CRS pany to, the CFO of your hotel company or the mother of is because the hotel company cannot attract, manage and two children that want to run a lemonade stand. keep software developers that want to work in the archaic language the old system is built in, another metric could Common Elements of a Business Plan be: headcount reduction in software development, mainte- Longer and more formal business plans will usually begin nance and support. with an executive summary, a brief overview of the plan While many important metrics are financial, quality as a whole, intended for the busy executive that will not and performance metrics matter too. Quality and per- read more than a page or two unless they become in- formance metrics usually relate back to cost or revenue, trigued by the executive summary and want to read more. but can be directly managed. What is a quality metric for But a business plan of any length and depth must begin Mary and Gwen? with a succinct statement of the objective of the initiative. Quality-based Metrics What about our two kids with the lemonade stand? Read the girls' executive summary: We need to ask every customer if they like our lemonade. If they like it, they might buy more later, or Executive Summary send someone else to our stand. If they don’t like it, we can make it better right away. If we don’t, they will tell Mary and Gwen want to run a lemonade stand this their friends to skip our stand. afternoon because we are bored and hot to raise $10 for Mom’s favorite charity. For the CRS example, quality and performance met- rics might be average talk time, net transactions per gross Okay, that explains what the initiative is. Another one transactions or interface failure percentage. could be: Reduce management risk and P&L losses by Any business initiative is time-bound in some manner. outsourcing the restaurant space to a concessionaire that When are you going to do this, and when will the busi- will pay the hotel rent instead of us running it at a loss ness benefit from the effort? Mary and Gwen’s lemonade ourselves. stand is time-bound as well. Now that we know the objective, what are the strate- gies that will enable us to achieve the objective? Timeliine Strategy Let’s do our lemonade stand today, because it is really hot. Tomorrow will be rainy, not good for a lemonade We have the lemonade mix, water and ice already, so stand. and we have gymnastics anyway. everything we sell will be profit money for charity, it is a hot day and lots of people walk down the main street at If your hotel restaurant is losing money every day, the corner of our block. then you need to know how long it will take you to find
36 HITEC 2015 Special Report Strategic Planning
a concession operator and get them operating in your space. There will be time required for negotiations, space " Business plans are used to convince others to renovations, licensing, for the operator to staff up and other things that need to go into the timeline. In the CRS support the initiative and provide the managers example, how long will you maintain the old system of the initiative with metrics, objectives and while training the reservations agents on the new one? milestones. Each plan should be tailored in content Almost all business initiatives, and their supporting and formality suitable to the purpose." business plans, require sales, marketing and communi- cations efforts. What does the lemonade stand need for sales, marketing and communications? For the restaurant, it might be the cost of running a Getting the Word Out temporary “Grab & Go” in the lobby while the restaurant space is being modified to fit the new concept’s require- We need a big sign that says: “Lemonade for Charity — ments. The concessionaire may require the hotel to pay 50 Cents.” And we will talk to everyone that walks by, for an interface from the new restaurant POS to the and people stopped in their cars at the stop sign. Also hotel’s PMS for room charges. The new CRS will require yell at people driving down the busy street. new interfaces, possibly a new facility, or the costs of disposing of the old facility, no longer needed. The new restaurant will want to advertise their opening Finally, all business plans should discuss risks to the ini- date, provide coupons or some other incentive to hotel tiative, and what those risks entail. What do the girls say? guests to try the new place and make sure they have a nice sign out on the street. The CRO outsourcing needs to Risks communicate the changes and the impacts to all affected What if Mom wants us to pay for the lemonade mix and employees, with consistent messaging about the impact. cups? We would have to sell more to reach $10. What Speaking of impact on employees, what does that if we Brian drinks all the lemonade? We would be in mean for Mary and Gwen’s lemonade stand? trouble. Staffing The hotel is risking the F&B requirements of guests on Mom says there always has to be at least two of us the concession’s ability to deliver and stay in business, so at the stand, but what do we do when we need more the contract needs a performance clause that allows the water and ice? Let’s make Brian do the running help us. hotel to take the space back. If the new CRS doesn’t have an interface to the PMS installed in all the hotels, then For our other initiatives, we have employees who will there is risk in developing and deploying the new inter- be affected, either laid off, hired or re-trained. The busi- face in a timely manner. ness plan needs to identify how many people will be laid off from the hotel payroll by outsourcing the restaurant Common Elements of a Business Plan and the costs of doing so. It also may lay out a strategy of In summary, business plans are used to convince others minimizing the impact by negotiating with the concession to support the initiative and provide the managers of the operator that all current employees must at least get an initiative with metrics, objectives and milestones. Each interview. Software developers that will be getting laid off plan should be tailored in content and formality suitable in the CRS example might be offered a retention bonus to to the purpose, but common elements include: stay on until they are let go, rather than seeking a new job • A clear statement of the objective(s) of the initiative now and leaving in two weeks. and key strategies to achieve the objective; Human resources and the goods that go into cost of • Identified key financial and non-financial metrics; sales (lemonade mix, water, ice, etc.) are not the only as- • Usually including a budget and pro forma P&L; sets required. These should be listed in the business plan. • A timeline for events from start to the point at which the initiative concludes or at a steady state of operation; Assets • Sales, marketing and communications plans; We need a sign, markers and way to hang the sign. A • A human resources plan; card table to put the lemonade on. Pitchers, cups, paper • Identification of other assets or investments required; towels. A box to put the money into! What else? • A discussion of risks entailed by the initiative and ways to mitigate those risks.
HITEC 2015 Special Report 37 TECH TRENDS IT/Marketing Partnership
Meeting Together on the Technicalities
here have recently been an By Brian Garavuso, CHTP increased number of conversa- Ttions about the strain, some- times stated as a war, between the Important fundamentals for building a trusted technology and marketing depart- ments. It has been said that market- relationship between the IT and marketing teams ing will just greenlight IT systems / software without consulting the IT department. At the same time, the marketing department is becoming a major purveyor of IT tools. In a study from Gartner analyst Laura MacLel- lan (2012), the results indicate that by 2017, the amount that marketing departments will spend on technol- ogy will be larger than all other IT initiatives within a company. Even if marketing is the largest consumer of technology within an organization, there shouldn’t be any breakdown in the relationship be- tween the CIO and the CMO. In fact the same level of partnership should exist between the CIO and all other C-suite leaders. I have seen success when some important fundamentals are followed within an organization in order to maintain the best business relationship between the CMO and CIO (or any other key department).
Key 1. Alignment / Partnership I realize that the phrase: “IT must be aligned with the business” has been overused and maybe even abused; but in my experience, it is absolutely necessary and key to overall success. There are several ways to ensure this alignment. First, are the CIO/IT leaders attached to and focused on the success of sales and marketing?
Brian P. Garavuso, CHTP ([email protected]) is executive vice president and chief information officer for Diamond Resorts International based in Las Vegas, Nev.
38 HITEC 2015 Special Report IT/Marketing Partnership
This typically means that they are the ever-changing customer needs sales and marketing IT projects. Our both focused on company earnings and outside influences. Therefore, IT department is now structured with or other important company goals. sometimes marketing priorities a dedicated group of IT profession- It’s important to know marketing’s change quickly. In addition, de- als specifically focused on sales and business. Know their KPIs and what mands on the marketing department marketing projects who manage that is important to them. You can’t be a often require a project to be com- department's specific IT needs. This good partner if you don’t know their pleted quickly. has brought the two departments in goals, objectives and challenges. In order for a project to succeed, sync. They meet biweekly to discuss Second both departments must there must be an exact agreement on ongoing projects, deliver dates, work to build a strong relationship. what needs to be accomplished. A cover new projects, and review and/ It starts with trust and respect. IT clear definition of the project's scope or adjust the prioritization of the has to be viewed and accepted as a and a realistic time frame should projects in the marketing queue. strategic partner, not just a platform be set. Sometimes negotiation is I’ll give you an example of provider. This is accomplished by necessary, but if the mutual trust and a recent urgent project that was thoroughly and continuously under- respect discussed above exists, than brought to me by Eric our senior standing the needs of marketing and this should not be a painful process. vice president of global marketing working together to bring solutions Advanced planning like this helps operations. When we met, he started that meet these needs and are deliv- reduce, or hopefully eliminates, scope the meeting by discussing his depart- ered as committed. By delivering creep which is a result of improper ment's successes of the past year, he projects on time and as requested, analysis and planning, and is a factor thanked me for my team's help and you will ensure that IT is always part that will over time erode the relation- explained in detail some of the po- of the initial conversations about any ship between the two departments. tential upcoming challenges. He con- project or initiative. The process also ensures that the tinued to explain how they planned project's success is measurable and to overcome those challenges and Key 2. Understanding Resources and therefore success or failure of the what kind of technical support was Communication business outcome is shared. Further- needed. He then dropped the small Marketing must be vested in the more both departments / business little bomb that this needed to be up success of the other departments that leaders should be willing to commit and running in about five weeks. He also rely on technology resources. time to share future strategies, busi- acknowledged the short time frame, Often the lack of understanding of ness goals and resource constraints. reiterated the importance to his the competition for IT resources This helps both departments gain ap- business unit (and the company) and brings about rogue or hidden IT preciation of the other's goals, objec- basically said that he was calling in a projects happening outside of the IT tives and budget constraints, as well favor without having to say it. department. Your company culture as other demands on the departments. I committed to get back to him needs to stress that this is not an in a couple of days with a proposed acceptable practice. If additional A Marketing/IT Scenario technical solution. My team rallied. resources are needed, IT and market- Now if I may, let me share a little We discussed how we could main- ing should work together to request about the relationship between the tain project integrity, but cut some the extra resources. The business sales and marketing and IT depart- procedural corners and think outside must see the partnership between the ments at Diamond Resorts Interna- the box. Within a couple of days of two departments as well. This will tional. I am confident to say that we the meeting, we presented a product also continue to foster the partner- thoroughly follow the principles that specification document and a rough ship between the departments. I outlined above. While there is often prototype. We all agreed that this In addition, marketing should be contention for resources, we’ve built would meet / exceed their expecta- able to prioritize their IT projects mutual respect and trust between the tions and we committed to meeting and reset prioritization as busi- departments. Please don’t get me the short deadline. Eric and I stepped ness needs change. There should wrong, it is not always perfect. There back and let both our teams get one be frequent conversations about have been projects or initiatives that with the project. Marketing was the status of ongoing initiatives. IT have gone a little sideways. When fully engaged throughout the whole should never be viewed as a “black we analyzed why, it always came process and IT stayed focused. The hole” for projects that go in, but to a lack of alignment of business project was delivered on time and is never come out. This will also foster goals, poorly defined outcomes and a proving to be a success. continued trust. lack of open communication. So in summary, there doesn’t Here is a little more insight into have to be shadow IT projects in Key 3. Agreement of Business Results how we interact with marketing (and your organization if technology is Marketing sometimes has a tough all major departments). As most IT truly perceived as a business partner job meeting their own goals due to departments, we have a long list of that can deliver as promised.
HITEC 2015 Special Report 39 TECH TRENDS Data Analytics
Turn Customer Information into Valuable Guest Engagement
oteliers have been warned for By Robert Cole some time that to effectively Hcompete in the future, it will be necessary to collect vast amounts To develop value-creating digital or real-world of customer data to power big data platforms and advanced analytics. engagement, consider three critical aspects of While that may indeed be true, a one-to-one marketing: quality data, customization significant gap exists between that lofty, abstract goal and the pragmatic and personalization solutions that drive the return on investment necessary to justify the spending allocated to support such projects. For hoteliers interested in devel- oping highly relevant, value-creating digital or real-world engagement, three critical aspects of one-to-one marketing must be taken into consid- eration. Quality data, customization and personalization are three inter- related, yet critically distinct facets of the equation.
Quality Data It all starts with quality data; specifically, the ability to associate online behaviors, such as campaign response, web site navigation and booking transactions with a guest profile. Similarly, stay information, such as folio/purchase detail, special requests and expressed preferences should also be captured, if pos- sible. It is increasingly important to acknowledge the multiple personas that all travelers possess. Under- standing how needs differ when a guest is traveling with family over a weekend, as compared to travel- ing alone midweek can dramatically improve guest satisfaction.
Robert Cole ([email protected]) is founder of RockCheetah a hotel marketing strategy and travel technology consulting company.
40 HITEC 2015 Special Report Data Analytics
Most hoteliers ignore the specific “personalization” refers to a very example of how big data opens new persona for each type of itinerary, different process when it comes to dimensions for marketing teams. choosing instead, to concentrate on working with identifying behaviors Most importantly, hoteliers must the simplistic tracking of a frequent and adapting guest experiences. have discipline to thoroughly test pre- guest number. While a number is Instead of being based on overt sumed signals for reliability. A high helpful in identifying the associated signals, personalization is based on degree of correlation may be reassur- guest profile, it has virtually nothing more implicit analyses of available ing, but when big data is involved, it to do with the purpose of the guest’s information. As opposed to a specific must also be remembered that it may stay. Presenting irrelevant offers guest’s behavior triggering a custom- not necessarily represent causation. or messaging wastes resources, ized experience change, personal- Additionally, refusing the tempta- undermines trust and potentially ized experiences are based on the tion to become too personalized and annoys guests. The key is to identify collective behaviors of a population behaviorally oriented is also vital. signals within the data that indicate a of similar individuals. Relying too heavily on algorithms high probability of relevance and/or Personalization frequently relies can introduce the risk of offering such conduct. If the source data capture is on contextual relationships between highly customized experiences that questionable, there is little hope for people, behaviors and outcomes. the guest could feel that their privacy the signals to be reliable. In many cases, the relationships is being infringed upon. A simple example is a guest and derived signals that indicate searching on a web site for room behavioral preferences may not be Predictive Analytics availability for a party of two adults simple or obvious. For example, a Predictive analytics are acknowl- and two children. If the web site sup- user entering the web site through edged as the holy grail of big data ports adaptive content, the web site a honeymoon landing page may not marketing. Wielding the ability to imagery may simply shift to photos be a sufficient signal to indicate that understand guest wants and needs, of families. It is relatively simple to upgraded suite accommodations even before the guest may real- run A/B tests to track conversion rates may be desired. However, it may be ize them, is a powerful concept. for typical images versus the family discovered that if such an individual However, the power of predictive oriented pictures. Over time, web site also happens to visit the “adven- analytics is built on a firm founda- performance can be optimized to of- ture activities” area of the web site tion of reliable signals that have been fer the best set of images based on the and also reviews the formal dining thoroughly tested and vetted. Most stay pattern and party composition. room’s wine list, there is an excep- importantly, the applicability of the tionally high correlation to booking signals within the proper contextual Customization a top suite. Further, through focused framework is essential in order to Customization is the process of mod- testing, the hotel may also ascertain avoid inappropriate recommenda- ifying the guest experience based on that by offering a couples massage tions that fail to engage or convert. clear signals expressed through guest as a value add, a suite booking is a The development of reliable behavior or stated preferences within near certainty. big data platforms that are able to the profile. Customization changes To arrive at such definitive conclu- accurately produce highly personal- traditional marketing dynamics. sions, incorporating multiple signals, ized marketing tactics may still be Suddenly, instead of focusing on a relatively large data sample and somewhat beyond the reach of the broad market segments or distribu- multivariate testing may be necessary average hotelier. Nevertheless, ample tion channels, specific guest behav- to identify the opportunity. Advanced opportunity exists to start getting iors can trigger specific responses personalization analysis takes a de- the data, placing the signals and — online or at the property. For cidedly different approach to identi- producing customized guest experi- most hotels, customization is a great fying the signals. Instead of targeting ences, based on explicit behaviors. starting point, beginning to gather the guest, marketers now focus on Innovative marketers that understand data, identify signals, test results and the behaviors. Bookings of upgraded guest experience customization will monitor performance analytics. suites by honeymoon couples are gain valuable experience that will initially isolated, then the universe serve them well as the industry starts Personalization of actions exhibited by the individu- heading down the path to true guest While frequently used interchange- als is analyzed to identify common personalization, powered by big data ably with “customization,” the term patterns. This provides a classic platforms.
HITEC 2015 Special Report 41 TECH TRENDS Big Data
Making Sense of Big Data
any hospitality companies are By Sherry Marek using big data today to under- Mstand trends and obtain ad- ditional customers. In addition, many How the industry molds the vast stores of data more hospitality companies want to comprehend the value of obtaining into useable content for customer outreach big data or correlating big data with data from their own systems. For many years now, hotels and resorts have used big data to understand current customers and obtain new customers by matching attractive customer profiles with current guests. Some of the older big data companies seeded their initial information with government census data, incoming surveys from war- ranty cards and buying mailing lists. Popular zip code lookup tools, help properties understand their current customer profile and seek additional customers similar to that profile. For example, if the weekend customer generally comes from a 250 mile radius of a property or from three specific metropolitan areas that have a direct flight to the city, companies can understand the demographic characteristics of those customers. Are they: Trendsetters — singles, not ready to settle down, unfettered by home and vehicle ownership, with good jobs who spend disposable income? Or could they be Downtown Melting Pot — barely able to make the ends meet? If it is 85 percent Trendsetter and 15 percent Down- town Melting Pot in a particular zip code area, perhaps it is an area a property should focus on by using direct mail, radio and other media to
Sherry Marek ([email protected]) is co-founder and vice president of Dataviaion technologies based in Pembroke Pines, Fla.
42 HITEC 2015 Special Report Big Data
advertise to these potential spending- ready customers. Most of these zip code analysis companies have " Today, customers want to understand what companies are doing anywhere from 50 to 75 profiles, with their data. They are often happy to supply information it if they providing the percentage breakdown trust the company to keep it safe. Others feel comfortable if there on overall market profile, income, age, population density, etc. is a perceived value to contributing information such as receiving a While many properties review service as Google Now. " their guest history loyalty database or guest history data, what about guests who have only stayed once or never before? Some hospitality may be useful someday. With track- Now. Heeding these concerns, many companies want to build profiles of ing technology available with the countries are enacting legislation this customer, available via big data, Internet of Things (where everyday to protect their citizens and clamp to understand their habits such as if devices such as watches, clothing, down on how companies handle they want to rent Segways for city etc. are networked and connected to personal data. Laws regarding data tours or if they like to attend sporting the Internet), there is a lot of poten- privacy may affect the accurate events. Other hospitality companies tial to have a better picture of guest understanding and tracking of data. use big data to compare booking patterns and in turn, provide better For example, the European push to trends and occupancy statistics to service. If a guest consistently resets enact the “Right to be Forgotten” analyze the results after a media the room’s thermostat to 68 degrees, concept means that Europeans may campaign such as radio or TV ads. this can be noted and programmed have links to personal informa- Hotel companies are adding for the guest upon their return. tion removed from the Internet. To big text analytics to their analysis maintain respectful management mix. This practice stores text or What Does the Future Bring? of the data, companies must have comments in many different silos Google’s predictive application security controls in place surround- throughout the company and uses Google Now collects consumer ing personally identifiable informa- programs to translate key words and activities and trends to create an au- tion (PII) to protect it in the case of a phrases. A sentiment index can be tomated virtual assistant for consum- data breach. assigned to the comment, as well ers. By sifting through e-mail, loca- as key likes or dislikes. By attach- tion, calendar and other data, Google Data Collection and Use ing customer sentiment from social Now can notify a person when they Disney has found a use for big data media, survey results and call center need to leave the office to get across which delights the guests and pro- logs, companies are able to under- town for a meeting and map the vides it with a wealth of knowledge stand customer experiences which most efficient route. How can this to make better decisions, improve its result in improving services and application be used by a property for offerings and personalize its market- product offerings. Other startups new guests? Can this be useful for ing messages. Disney collects data have started taking photos posted to when a first time guest stays at your from the MagicBand which engages Instagram, comments from Twitter property and your hotel suggests spa guests with the magic of technol- feeds and other social media tools to services, which based on the data is ogy woven throughout the parks and create consumer profiles that allow a particular interest of the guest? Or resorts. With the MagicBand, guests companies to create an outstanding how about dining preferences? can order meals at a restaurant in customer experience based on the advance. Upon entering the restau- consumers’ interests (i.e. exercise What are the Possible Pitfalls? rant, the host greets guests by name. habits or entertainment preferences). Today, customers want to understand Then, another host welcomes guests what companies are doing with their to sit anywhere they like and almost Think Before Diving into Big Data data. They are often happy to sup- by magic, specific food orders find A lot of big data is available today, ply information it if they trust the guests shortly after they sit down. but not all of it is currently useful to company to keep it safe. Others feel How did this work? When the cus- a property. Yet, companies outside comfortable if there is a perceived tomer is a few feet from the restau- the hospitality industry continue to value to contributing information rant entrance, a radio signal picks up collect the data, reasoning that it such as receiving a service as Google the family and the hostess is notified
HITEC 2015 Special Report 43 Big Data
on a modified iPhone. After the of Walt Disney Company explained next five years. Many companies are customers choose a table, the radio the goals for the MagicBand with a looking to understand how they can receiver triangulates their location reference to Arthur C. Clarke, “Any incorporate pieces of the big data with the order placed earlier so the sufficiently advanced technology pie into their company and leverage server can deliver food to the table. is indistinguishable from magic." this powerful data knowledgebase Another magical experience is to (Wired, March 2015) (Gartner Group). visit the rides in the park. Prior to Today, some resort properties track Equally important, it is vital to arrival at the park, guests enter their guests going through specific door- measure and understand how to track favorite rides and Disney crunches ways: to the health club or walkways the changes in metrics as a result of this into an itinerary, calculated to to the beach, to measure the flow the new big data initiatives. Some keep the route efficient. A credit of on-property traffic. This is done metrics may be new to the property. card is linked to the MagicBand, via security cameras equipped with Some big data initiatives need to so there is no need to carry a wallet software to identify many guests, be tracked to confirm that big data for purchases in the park or hotel, and coming ahead: facial and voice provides the uptick in bookings as linking the 100 plus systems in the recognition technology. Add this new expected. Some marketing initia- complex including door locks. This metric, plus reservations at the spa or tives may fail, if the technology isn’t is real time data analysis on what golf course and suddenly, companies mature enough or the database is not the guests are doing and what they are able to understand the amount of fine-tuned to correlate all of the data want to do. Overall, the MagicBand time that a guest spends on property. points expected. As Tim O’Reilly, experience translates into guests founder of O'Reilly Media comment- spending less time in line. They are What Does the Future Hold? ed, “We’re entering a new world in doing more, spending more and re- Big data markets are estimated to which data may be more important membering more. Tom Staggs, COO grow 45 percent annually over the than software.”
Glossary Additional resources: Big Data www.datasciencecentral.com Gartner Group defines big data when volume, variant and velocity of Online resource for big data data exceed an organization’s storage or compute capacity for accurate practitioners. and timely decision making. (Gartner 3-D Data Management 2001) www.Nielsen.com Data Lake Nielson DMA designations — Unstructured data, unprocessed by analysis, with no order or hierarchy. private company which sells (like water modules in a lake, a big free for all). exclusive geographic area and reports media market penetration. Data Warehouse Data is archived and ordered in defined way (in containers, on shelves, www.esri.com in orderly rows like a traditional physical warehouse). Provides data by tapestry segments, income, age, etc. to Gamification illustrate demographic and lifestyle Process of creating a game from something which would not normally information about a neighborhood. be a game. This is a powerful data collection tool. Hadoop Free, Java-based programming framework that supports processing of large data sets in a distributed computing environment. IoT — Internet of Things Physical products that collect information about user location and behavior.
44 HITEC 2015 Special Report TECH TRENDS Digital Marketing Strategy
Metamediaries: The New Frontier of Worry For Hoteliers
ith all of the complexities By Loren Gray of a hotel’s digital pres- Wence in our current market, it’s of little comfort that despite all efforts it may be to no avail. That’s The power of the littlest screen could gain because the very technology that is the greatest control over search parameters used to find our hotels steps in line and controls our ability to connect to our audience. It’s easy to insert Google into that statement, but not necessarily for all the apparent reasons. Search engine results are and have been a part of our ongoing everyday life, and strategy. The growing shadow is over deliverability, put simply it’s all about the phone.
New Search Parameters for Mobile In our ever-growing use of mobile1, by any and all definitions of screen shape and size, comes the very real race of the very platform itself, the phone and its operating system. With Google’s widening market share via its Android-based phones, comes its ability to satisfy the convenience de- mand of its users with Google Now, its semantic search development which delivers results based on the searcher’s intent and context. Mirror that with Apple’s Siri, Microsoft’s Cortana, and you see why Amazon found it so critical to join the fray with its Fire Phone. So what is all the interest in semantic search, that new interactive way all this voice assistance works? Quite simply it offers the path of most convenience. For mobile users, typing, searching, navigating, basi-
Loren Gray ([email protected]) is vice president of digital strategy for Standing Dog Interactive based in Dallas and Houston, Texas.
HITEC 2015 Special Report 45 Digital Marketing Strategy
accommodations in one fell swoop. Metamediary Since Google already has your meth- Metamediary is a term to describe a disruptive process of an even greater od of payment on file, your travel intervening market presence. We can look to other platforms that fit this history, your preferences and even definition both in potential and scope of use. In addition to Google, Apple your reward membership information, and Amazon, you can also include Facebook and Tripadvisor, by both sheer even more convenient would be to size and data. The one thing they all share is they stand between the hotelier get a notification from Google Now that has already looked for and found and the potential guest, and are getting better at not including the hotels in your best flight options, hotel selec- the process of guest choice. tions, and transportation services such as Uber. All you have to do is confirm cally anything physically interactive location-based data and active bid the choices. Wait, what just happened with a mobile device, is less conve- management within HPA, even your to search results and rankings, or nient than simply asking and being most relevant content will not show using all those apps we keep on our told what we want. Sematic-based on a mobile SERP page above the phones for doing this? Put simply, the search makes this possible. fold; but be certain, all of Google’s convenience that the phone provided With the rise of online bookings data choices will. just short-circuited all of it. coming from mobile2, this would As disturbing as that may be, Now of course we can move on to at first glance appear to be a strong there is still more to be concerned review Apple and its use of SIRI or positive for hoteliers, as they contin- about. Remember the path to the Microsoft's use of Cortana, and you ue to improve their online presence most convenient? We know in our begin to see why Amazon wanted to via mobile. But with screen sizes current world of big data that Google get in on the phone making market shrinking, so too does the volume of knows a lot about us, even more so if sooner rather than later, especially content represented. you use them for the host of services with its own established payment With almost 70 percent of all they provide, such as Gmail, G+, system and big data driven purchase search volume coming from Google3 YouTube, Google wallet and others, platform. Add to that the evolution let's start by bringing our attention to all of which require a user to have a of semantic search and increased its recent developments. Going back Google account. data available about us as individu- only a few short months, we have We have already seen that when als (remember over 40 percent4 of seen dramatic changes from Google. you receive a flight confirmation us in the United States have said we First was the securing of searches, or hotel confirmation in Gmail you would be willing to give out more effectively ending the use of key- can check-in right from the e-mail personal data if it improved our user words for web site optimization. (thanks to the addition of new experience). Now combine it with a Then came the Mockingbird search schema coding). For now this links method of payment already in place, engine update, maximizing the use you back to the site of your book- and you can see that the actual phone of schema (a markup language that ing to expedite your travel process, becomes the tool, not the third party adds context to a term). With the ad- but already other online payment software added to it. vent of schema comes a more robust solutions you may have, like PayPal, Just think of all the apps we ability to display specific content as are beginning to show up as alterna- stopped using due to a better one it relates to the intent of a search, tive forms of payment. Now imagine coming out, now imagine it if it’s the not just the words used in a search. before you book anything, you ask actual phone and its OS functions. Google proceeded to refine its search Google Now about hotels options If we want a sense of what this may engine yet again with the release of at your intended destination. It can be like, examine what happened to the Pigeon update, which now brings check on what your best choices are all the health apps when Apple’s IOS the definitive end to non-mobile and allow you to select and purchase 8 was released. They all integrated friendly sites, simply removing them with them via Google wallet. No with iHealth at the risk of being re- from mobile SERP (search engine typing, no forms to fill, no search placed. And now with Apple Watch, results page). Add to this the use results to sort through, just say: this risk is even greater. of Google’s Hotel Price Ads (HPA) “Book it.” program of real time rates and inven- As wondrous as all that may seem New Marketing Strategy tory availability. Now you quickly for the user, not too far from this So when does the scale tip? For see that without hyper-specific, process is the potential to book all Google, it's probably when the
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revenue potential from handling pur- world hinges upon what makes us 2. King, Danny. December 1, chase transactions is forecasted to be a success now, good hospitality and 2013. Travel Weekly. PhoCus- larger than the current revenues from location. The OTAs have more to Wright. Report on Mobile pay for placement advertising, espe- be concerned about then the brick Bookings Shows Rapid Growth. cially from the online travel agencies and mortar operators, because they (OTA). Also, the continued growth would have to justify their larger http://www.travelweekly.com/ of mobile use is another factor. For commission model and in turn only travel-news/travel-technology/ Apple, Microsoft and Amazon, the be valuable during the discovery phocuswright-report-on-mobile- bar is more connected to a disrup- phase of travel. Just as Google bookings-shows-rapid-growth/. tive model and based on scaleability and the rest try to personalize the 3. comScore. February 18, 2014. and reductions in app development process, so do our individual prefer- comScore Releases January 2014 revenue. We’ve seen this before with ences gain more value. By providing U.S. Search Engine Rankings. Apple, when it has cannibalized one our guests with a better experience revenue stream for another (iPod to and being located in the right place, https://www.comscore.com/ iPhone). we inherently will be their guided Insights/Press-Releases/2014/2/ For either reason, we as hoteliers location of choice. comScore-Releases-January- could simply become a commodity. 2014-US-Search-Engine-Rank- After all, we do not own our place ings. on any search engine, app or carrier Sources 4. Edwards-Onoro, Deborah. June service, it's all rented land. This 1. Statistic Brain Research Institute. 17, 2014. Lireo Designs. U.S. Pri- is not a pronouncement of gloom March 3, 2015. Internet Travel and doom though. Ironically a lot Hotel Booking Statistics. http:// vacy Index [Infographic]. http:// of the success that a hotelier could www.statisticbrain.com/internet- www.lireo.com/usa-privacy- have in this soon to be convenient travel-hotel-booking-statistics/ index-infographic/.
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