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Is Airbnb Really the Experience of a Lifetime?

Over the past couple of years, there have been many studies and reports that highlight how Airbnb is a threat to major hoteliers. One study estimated that hotels lose approximately $450 million in direct revenues per year to AirBnb. But it doesn’t have to be this way.

Airbnb has embarked on a marketing campaign based on the premise of having travelers live in destinations – as opposed to merely being tourists. The concept is that by staying in an Airbnb, you will be able to live like a true local, and have an “experience of a lifetime.”

Aiming to appeal to Millennial travelers, this campaign is certainly different when it comes to hospitality marketing, but are they excluding a large group of travelers?

This is the main theme behind a recent Skift Magazine quest article that discusses how travelers may not want to actually live like a local. For example, when many people travel to Paris, they actually want to enjoy some of the world-class tourist sites, which includes the Eiffel Tower and The Louvre.

“The big group that’s being excluded is also people who travel from certain parts of the world to see other parts of the world. People who spend their hard-earned money to do so. People who, yes, sometimes stay in hotels precisely because it’s NOT like being at home. Because sometimes they don’t want to do the stuff they normally do – they’re on vacation trying to do stuff that they never do, or have never done before” stated the article.

In addition, when you stay at an Airbnb, you have the option of cooking your own meals, which may not be an experience of a lifetime. For instance, many travelers enjoy the cuisine that is offered by their hotels, as well as top restaurants in the area.

While Airbnb can certainly be seen as a threat, major hotel brands can counter this by focusing on providing a guest experience tailored to the traveler, such as those people who want to be tourists.

By staying in a world-class hotel that offers specific amenities and services to different categories of tourists, you could potentially provide an “experience of a lifetime.” More important, you don’t need to shop for groceries and cook your own meals.

 

Hotel Guests Prefer to Bring Their Own Content

According to a new study, the pay-TV industry lost more than 700,000 subscribers in the second quarter of 2016, which is the worst customer attrition statistic to date.

For hoteliers, this is a clear sign that guests prefer to bring their own devices and content when they travel. Whether it’s through accessing services like Netflix or streaming their content – via Digital Living Network Alliance (DLNA) – to the hotel rooms’ televisions, guests now prefer complete control over their video content.

This trend mirrors what is happening in many consumer households, where family members have their own devices for watching what content they want when they want. Consumers have also grown tired of paying for expensive monthly cable services that, although offer an astoundingly wide-array of channels, are unappealing to many.

This all points to the need to provide sound WiFi for guests.

According to the recent Hospitality Technology Magazine 2016 Lodging Technology Study, adding bandwidth remains a top objective for 45 percent of operators. The report also found that networking/bandwidth connectivity will account for 17 percent of hoteliers’ technology budgets for 2016.

Guest demand for wireless Internet access is also increasing. For example, the number of consumers who reported that they expect free WiFi at fast-casual restaurants rose 24 percent in a two-year period, also highlighted in this study.

In addition, the study discussed how hoteliers are using their WiFi connections to help monitor guest behavior. These analytics include who the customers are and their demographics, as well as hotspot analytics that show total traffic, impressions, loyal customers and how often they return.

As many consumers “cut the cable cord” at home, the same trend is happening in the hospitality arena. While pay-per-view TV revenue will decline for hotel brands, there is a new opportunity to leverage bandwidth in ways that can provide guest insights and increased loyalty.

 

The Graham Georgetown Fully Embraces Next-Gen Guest Personalization

When it comes to hotel guest personalization, some brands rise above the rest. These hoteliers tend to be boutiques located in prime areas that offer a number of different restaurants, events, concerts and other attractions.

These hoteliers are also more nimble in their ability to embrace new innovations and processes, as well as provide staff training that supports true guest personalization.

The Graham Georgetown is one of these brands.

According to this recent Hotel News Now article, the hotel offers 57 rooms and is located in the heart of the Georgetown neighborhood of Washington, D.C. Here are some of the key takeaways in terms of how the brand is a personalization leader:

  • The ‘GPS’ Experience: The hotel staff is trained on the idea of the ‘Graham Personalized Service (GPS),’ which is all about pre-arrival communications and anticipating the guests needs before they arrive.
  • Elevating Personalization: The staff also takes note of guest preferences when there are on the property, which allows them to best cater to these travelers the next time they visit.
  • Expanded Food and Beverage: From a rooftop bar to themed-nights to dynamic live entertainment, The Graham Georgetown continually seeks to offer diverse entertaining food and beverage experiences.

Although it is challenging for larger brands to offer this level of personalization, hoteliers should take a page from The Graham Georgetown, and implement some of these strategies. In addition, by focusing on- and off-property experiences, and anticipating guest needs before they arrive, it is possible to develop long-term loyalty from a wide-range of guests.

Clearly, The Graham Georgetown understands this.

 

Time to Embrace International Hotel Guest Personalization

According to a recent study, 2015 was a record year when it came to the number of international travelers who visited the U.S. Last year, 77.5 million international visitors came the states, which is a three percent increase over 2014.

Many of these visitors came from China, South Korea and the UK and arrived into major cities like New York, Miami and Washington, D.C.

For hoteliers in these cities, this means that they deal with a culturally diverse group of travelers – many of whom came from long distances – to experience the U.S. This calls for hotels to enhance personalization on a cultural level – beyond using innovation to achieve this.

This means considering implementing cultural sensitivity training programs for all front-line staff that allows them to engender comfort from the international travelers. It extends beyond just serving international meals in the hotels’ restaurants to knowing how to properly greet a guest in Chinese – by way of example.

Of course, there will be scalability challenges when it comes to doing these types of training programs. However, if large brands focus only on the properties in the cities that attract international guests – this is a great start.

The ultimate outcome of these types of training programs is global loyalty. International travelers – many of whom are affluent – will share their culturally positive experiences with friends and family when they arrive home, and continue to re-book for future trips.

Guest loyalty is the holy-grail in the hotel arena, and now is the time to develop the right programs that are truly personalized for any international guest.

Hotel Innovation Lab Aims to Maintain Brand Consistency and Court Younger Travelers

Marriott International has embarked on an effort to advance innovation in a way that courts younger travelers, yet also maintains brand consistency for older guests.

Achieving this balance is a significant challenge. However, the leading global hospitality brand, Marriott, has made its downtown Charlotte, North Carolina its new innovation lab – for testing new technology concepts.

According to this recent Fast Company article, the property has “beta buttons” on its walls, tables, and iPads, as well as “beta boards” for gaining instant-feedback from guests. Of course this new effort is truly aimed at appealing to next generation of consumers – millennials and gen Z – who will soon make up the bulk of the hotels’ customers.

This does not mean that Marriott is abandoning its baby boomer guests, who seek brand consistency when they travel to properties. As such, Marriott is now focused on introducing variety into hotels, while also ensuring that guests leave knowing they’ve encountered the Marriott brand.

A bigger challenge for Marriott and other large brands wanting to seek this balance is the investment in upgrading all properties to meet these new needs. The property refresh cycle was typically four years or more in the making. Today, brands are speeding up this cycle in order to remain competitive, and offer unique guest experiences. For many brands, this rapid development cycle is not economically sustainable.

However, Marriott is leading the way by making innovation, and especially feedback from younger guests, a true part of its DNA. As the brand continues to evolve, this heritage of innovation will allow it to remain differentiated in a highly competitive, and fast-moving arena.

 

Boutique Hotel Success is About Attitude and Approach

In today’s hospitality arena, there is a movement to create more boutique hotels, which can offer solid profit margins and the ability to offer a unique guest experience.

The challenge is that many investors moving into this space – to capitalize on this opportunity — are taking a “me too” attitude with the singular focus on making the property’s design different and innovative.

As recently highlighted by boutique hotel visionary Ian Schrager, the key to success is attitude and approach, which should be about offering an elevated experience.

Schrager also pointed to the need to stay away from just focusing on design.

“Special effects in a movie make a good movie better, but they don’t make a bad movie good. I’m worried we’re seeing the same kinds of hotels now but in different colors,” said Schrager at the recent Boutique Investment Conference.

He also discussed how guests often don’t expect top service from boutique hotels. When top service is combined with top design, then the real “alchemy” of true guest loyalty can be fostered. It also takes an attitude where traditional hospitality rules should be broken, which can lead to long-term success.

As the boutique hotel sector continues to be a prime target for investors, Schrager’s insights should clearly be taken into consideration, especially since there’s the risk of oversupply.

“It doesn’t matter that there’s an oversupply problem in New York. Come prepared with a great product, and it’ll do great. Same with Airbnb. The best way to compete with Airbnb—which is coming after our children—is to provide a unique experience,” added Schrager.

The “unique guest experience” continues to be the holy grail in the hotel arena. The challenge is that the stakes are higher for boutiques, and the need for the right “attitude and approach” will dictate business growth in the long run.

 

Focus on Guest Experience Design First

According to a recent Priceline survey, most travelers want just one app that would facilitate all of their travel needs. This hypothetical mobile app would cover everything from planning to booking and ticketing across all forms of travel.

As most people have a finite amount of time, and are also dealing with technology fatigue, this approach makes sense – especially considering how fragmented the travel experience can be when dealing with multiple travel apps from hotel brands.

Most hotel brands develop their travel apps with the thinking that guests will automatically want to interact with them through these channels. Unfortunately, this may not always be the case because the apps are not designed with the guest experience in mind.

Much like the enterprise IT world, where security is now being built into any new innovation from the start, hoteliers may want to consider “guest experience design” first. In other words, think of the guest first and the experience they potentially want – then from there it’s a matter of agile development.

For example, some hotel brands are offering songs and music as an extension of their rewards programs. While on the surface, this seems like a creative idea, it may actually dilute the brand because it’s not travel related. In addition, it may not be worth developing any kind of program that does not extend the value of the stay.

By focusing on the guest first, it is possible to have more meaningful interactions with travelers through hotel mobile apps. This is no small challenge. However, by gaining the right guest data first, and then proceeding with development based on these insights, it is possible to capture guest attention and loyalty in this mobile arena.

 

Generation Z Emerging as New Cohort for Hospitality Arena

According to Hotel News Now, Generation Z is the post-Millennial cohort that is emerging as the new group transforming the hospitality sector.

Driven by experiences over purchasing material items, Generation Z have more pending power, a fear of missing out, advanced social media use and a desire to be more multicultural.

Of course, this new generation will also want an “authentic guest experience,” which has been a popular term in the hotel sector for a while now. As we have highlighted before, offering this type of experience can be challenging – especially in a world where the concept of “authentic” changes very quickly.

When looking at the traits and desires of Generation Z, it seems that they are not too different than Millennials. Millennials have always adopted new and disruptive innovations long before the traditional traveler, and have the same motivations as Generation Z.

In many ways, it is optimal to view this shift as the future of travel – no matter the generational title of the traveler. Of course, we should not forget about the spending power and the desires of baby boomers and Generation X.

While this group may not prefer “communal” experiences, they still want to be treated in ways that meet their needs. For example, Baby Boomers may not prefer mobile check-in and want to interact with a real human concierge.

The future of the hotel arena will continue to evolve rapidly. Though one thing will remain constant, which is the need to please guests throughout the entire stay cycle. No matter the guest’s age, hospitality providers will need to continue new efforts to provide personalized experiences. Of course, this is no small task.

 

Hotel Guest Engagement Has Nothing to Do with Selling

In today’s era of providing authentic guest experiences, many hoteliers are seeking new ways to enhance guest engagement. For many this can be the key to unlocking long-term loyalty, and counter rising competition from sharing economy alternatives like Airbnb.

The challenge is the definition of “engagement.”

For many this concept is simply communicating with guests through their preferred channel, which is most likely on their mobile devices. A recent Tnooz editorial discussed how there is a myriad of communication technologies available – but true engagement “supports the consumer’s need to feel special and it is tailored to their desired amount of attention.”

Delighting the guest with a two-way conversation is paramount, as opposed to communicating offers through a mobile text. The challenge is that most hotels have one agenda when it comes to guest engagement, boosting revenue.

This often comes with pushing guests towards events and attractions that intend to up-sell them, which should not be the priority. True guest engagement should be all about providing quality and tailored information that improves their overall stay – it should have nothing to do with immediate revenue expansion.

Though the ultimate outcome would be long-term revenue growth. For example, Mick Jagger and Keith Richards did not set out to become rich and famous rock stars when they were young. They were passionate about blues music coming out of the U.S., and wanted to expose the world to their interpretation of this special music. As a result, they ultimately because major rock stars, which was a side effect of this effort.

Major hotels can take a page from Mick and Keith and focus on providing quality experiences to the guest, with no plan for immediate financial return. But in the long-term, this type of effort will bring in far more revenue from a steady stream of loyal guests.

This type of revenue will most likely surpass any income that would come from an offer sent to a guest via text.

 

Hospitality Technology Arena Maturing – What’s Next?

Based on a recent Wall Street Journal interview with Marriott’s Chief Information Officer Bruce Hoffmeister, it is obvious that the hospitality sector has made tremendous leaps and bounds when it comes to adopting new innovations.

It seem like only a couple of years ago that major hotel brands were just starting to embrace the concept of mobility, and other innovations aimed at pleasing the guest through the entire stay cycle.

Fast-forward to today and hoteliers like Marriott are an example of how to employ mobility and other innovations – such as providing “unique guest experiences” to interacting with guests at multiple touch points. Leading hotel brands are now officially on the forefront.

So, what’s next?

While many of us don’t have crystal ball in front of us, it would be safe to assume that innovation will continue to transform the guest experience. Whether it’s the true adoption of robot butlers and concierges to ubiquitous keyless entry, the foundation for brand loyalty will lie in evolving technologies.

And even though at some point in the near future, these types of technologies will be commonplace at any property, this normalization of innovation will continue to create a new springboard for the next level of exciting technologies.

Of course, it is difficult to see this next level through a crystal ball. However, we imagine that Marriott will continue to spearhead the latest technologies on their properties, web and mobile apps.