Social networking takes off

Social media interaction was the hot story of the year, with seemingly every chain announcing hotel booking applications for Apple’s iPhone (and sometimes for the more widely-used Blackberry); Nokia integrated Expedia’s hotel booking functions into its Ovi Maps phone module.  Many properties launched Facebook pages to reach new guest segments, and some began offering updates and special offers on Twitter; Inoqo even launched a Twitter-based hotel booking engine.  Intercontinental implemented Jive Social Business Software to connect with its 40 million Priority Club Rewards members, and Starwood Preferred Guest announced a suite of Twitter, Facebook and iPhone applications.  Hotels.com integrated TripAdvisor reviews on all of its 31 web sites.

With all this social interest it became essential for hotels to manage their activity on multiple social media Web sites and to keep a close eye on their online reputation.  New services such as TravelCLICK’s Social Media Optimization, Lodging Interactive’s HuBBub, Standing Dog’s ReviewAnalyst, Milestone Internet Marketing’s eBuzz Connect and others arose to help.  Raveable’s beta site offered to identify and consolidate opinions buried inside the text of guest reviews, ShermansTravel’s Sherman Meter meta-search tool rated hotels by tabulating thousands of hotel reviews and ratings, and Libra OnDemand integrated Facebook, Twitter and LinkedIn into its CRM tools.

Consumer technology rules

Consumer technology in general grew strongly in influence, especially in the guestroom, and Apple’s iPod Touch and iPhone became the default interactive devices for both guests and staff.  Micros’ HSI division adopted the iPod Touch as a handheld POS device, and Bardessono Hotel became the first US hotel to deploy MTech’s REX iPhone/iPod Touch-based housekeeping room expeditor system, followed by Gaylord’s Opryland.  MICROS added its PDA-based MyStayManager for reservations, profile management, check-in/out, folio viewing, restaurant reservations and room service, as well as SMS Texting to send messages to guests and staff phones and PDAs. Knowcross also leveraged SMS for its SKIGEE dedicated text messaging application. The Hilton Phoenix in Chandler, AZ introduced 3D-animated training lessons on iPods for its housekeeping staff.   MSI (Multi-Systems, Inc.) now lets managers access property and guest data from an iPhone/iPod Touch, and also showed its WinPM system running on a Microsoft Surface table display. InterContinental Hotels Group installed its first Microsoft Surface (at its Buckhead Atlanta property) and Harrah’s Resort Atlantic City installed seven of them in its Xhibition Bar.

The connected guestroom

Greater integration came to the guestroom itself.  Lutron’s Connected Guestroom allows guests to control lighting, window shades, temperature, security and TV from their TV remote or mobile phone, and INNCOM partnered with set-top box vendor Enseo to provide similar control via the TV remote control. INNCOM also released interfaces to property-management and building-automation systems, IP telephones and in-room entertainment systems.  MTech integrated its HotSOS guest request/work order system with Control4’s Suite Systems, Intelity’s ICE and Runtriz’ Hotel Evolution mobile phone room-control/guest request application. The Nordic Hotel Forum in Tallinn, Estonia became the first Baltic region hotel to offer guests Skype telephones, while the Hotetur chain deployed VoSKY’s Exchange PBX-to-Skype gateway at 30+ sites and considered offering guests in-room Skype connections.  Sounds like the concept of guestroom phone call revenue is now officially dead.

GBCblue developed in-room portals for Hyatt, Omni and Starwood for guests to view information relevant to their stay, order room service, provide feedback about service and access local attractions.  Control4 added a Concierge Service to connect guests with information, services and reservations in and around the hotel, including their Facebook and Twitter pages, and released a ZigBee-based interface with SAFLOK’s Messenger networked locks which lets both use the same hotel network.  OpenWays solved half of the universal guestroom key challenge by using guests’ mobile phones to replay coded sounds to the lock, though the locks themselves still need to be retrofitted with receivers; Saflok and MICROS agreed to interface to this approach. Finally, the Fraunhofer Institute for Industrial Engineering and Organisation developed one of the more interesting approaches to a “hotel room of the future” in one of its laboratories, with an emphasis on technology that can help guests relax.

Business Intelligence (BI) grows further

Looking for ever more comprehensive and accurate information, more hotels expanded their business intelligence efforts.  Benchmark picked Aptech’s Execuvue system for its 30 properties; Crescent chose ProfitSword’s ProfitSage for its 55 hotels and resorts, as did Wyndham for all of its managed properties.  Many chains and properties adopted UniFocus’ survey tools to gather quantifiable guest and staff survey data, including Schweitzer Mountain Resort, Setai San Diego, Best Western, InterContinental, Real Hotels & Resorts and New Castle Hotels & Resorts.  Good Hospitality Services implemented Alloso Technologies’ Portfolio One system for its 20 hotels, and Apple REIT activated M3’s M3 Link operations reporting tool at 198 properties.  Foxwoods chose a Netezza data warehouse appliance and SAS software to collect and analyze data from its six casinos and three hotels; InterContinental acquired a Teradata data warehouse appliance as the base of its BI efforts.

On the BI vendor front, PAS introduced pasUnity to integrate front office data with its accounting/financial reporting, and Aptech enhanced its Innvue Web-based application for consolidating daily operating and performance data from different property systems for multi-property chains and management companies. Datavision released a new version of its Business Intelligence Suite built on the latest Microsoft technologies (SQL Server 2008, SharePoint Server 2007 and Silverlight).  Dashboards gained prominence as a way to interpret the data visually; Micros added an Activities dashboard to Opera, Passkey released two versions for multi-property event tracking, and ResortSuite released on-the-fly customizable dashboards for its wide-ranging resort management suite.

Centralize, Integrate

Centralized systems continued to be adopted by hoteliers looking to outsource their support and gain more consistent reporting.  Colonial Williamsburg picked Agilysys’ Visual One suite for five properties, Columbia Hospitality opted for a Northwind-hosted Maestro PMS/Sales and Catering implementation for six properties, and Focus Hotels implemented protel’s centralized PMS/S&C in eleven UK properties.  Vendors got in on the act, too, with Pegasus outsourcing its technology infrastructure and support to HP.

Integration continued apace.  Omni Hotels added two-way integration between its new Micros Opera-based reservation system and Rainmaker’s revolution Profit Optimization Suite.    In addition to its guestroom vendor links, MTech integrated Libra OnDemand’s CRM tool into its HotSOS application.  SAS predictably announced closer integration of its IDeaS subsidiary’s revenue management with its own BI and campaign management capabilities. InterContinental Hotels Group (IHG) deployed its first “Hotel-in-a-Box” technology package, which integrates property management, cabling & wiring, network design, guest high speed Internet access, door locking, telephone switch (PBX) & phones, video surveillance, voicemail, business center, HDTV and in-room entertainment. Newmarket partnered with Dun & Bradstreet and Bluebuzzard signed with Hoover’s, both using these massive business databases to improve the completeness and accuracy of their customers’ information.

Reservations, Revenue Management

CRS activity surged, especially for Trust International (Charming Hotels and Resorts signed for 33 properties, Dorint for 36, HUSA Hoteles for 160+).  VFM Leonardo seemed to corner the market on hotel chain rich-media management, and Sabre’s SynXis RedX was on a roll with multi-property signings from Menzies Hotels (16 properties), Norway’s De Historiske (37), Mandarin Oriental (25+), JAL Hotels (58) and Japan Rail (61).  RedX passed the 10,000 property mark before being rolled into Sabre Hospitality Solutions along with Sabre’s other travel divisions.

Revenue management was another area of strong activity.  Peninsula Hotels deployed OPERA Revenue Management System for ten hotels, and Derby Hotels rolled out IDeaS V5i to nine.  Amari Hotels & Resorts and Metro Hospitality Group implemented EZYield at 12 and 14 properties respectively, and as a measure of general activity EZYield.com announced that it processed a record 2.1 million rate/inventory updates in January 2009, three times as many as a year ago. Rate Tiger released enhanced versions of its RTAllocator Pro and RTShopper Pro channel management tools, and Micros integrated RTShopper into its Opera PMS, ORS and RMS systems.

It’s Getting Easier to be Green – in small steps

“Green” is still cool, if sporadic in its implementation in hospitality.  Marriott led the way by being ranked for the second year on Computerworld magazine’s “Top 12 Green IT Companies” list.  Measures included a new data center 220 feet underground, raising its air-conditioning temperatures 10% to 15%, using virtual servers wherever possible, desktop power management and thin clients instead of desktop PCs.  It also started replacing the 24 million plastic key cards that it purchases annually in the U.S. with alternatives made of 50 percent recycled material.  Chartres Lodging installed Telkonet SmartEnergy thermostats in over 3,500 rooms; Microsoft introduced its Environmental Sustainability Dashboard for Microsoft Dynamics AX to display data on four core environmental performance indicators.

Specific “green” projects ranged across the board, from the Crowne Plaza Alice Springs’ 530,000 kWh/year solar photovoltaic (PV) system to Cambean Hospitality installing solar panels and a wind turbine on the roof of the Clifton South Beach Hotel. Kaba introduced two environmentally friendly keycard options using 100-percent recycled PVC plastic and from corn-based (and biodegradable) polylactide acid plastic.  Starwood’s Element Hotels planned to install ChargePoint electric car-charging stations at all of its properties.

RFID

RFID was still a slow grower last year, though VingCard reported strong demand for its Signature RFID locks.  Elsafe has launched its Sentinel II in-room safes, which use both RFID/NFC technology and RF-online options.  As before, though, the use of RFID for inventory/purchasing efficiencies hasn’t taken off.

Standards

With all this integration and interaction the need for standards seemed clearer than ever.  OTA continued releases of its interface specifications, and announced its FastRez connectivity approach to simplify the automation of reservations for smaller hospitality companies.  HTNG’s workgroups expanded existing specifications and released new ones, and its list of certified vendors grew as more senior hotel chain executives joined its board.

M&A

As for mergers and acquisitions, it was a relatively quiet year.  The major deal was SoftBrands being acquired by Infor in June, though there has been surprisingly little news since then on Infor’s goals for it.  EZYield.com acquired HotelProphets, its Australian partner in hotel distribution and online marketing technology, and Travelocity Global acquired India’s Travelguru online hotel distribution network. Lanyon acquired corporate travel expense management vendor DirectConnections!, and TripAdvisor picked up Kuxun.cn, the second largest online travel-related web site in China.

And now…?

What’s coming this year?  With so many good examples of synergy between different systems running on shared IP networks, I expect to see many more integration efforts between guest service vendors to provide ever-expanding ranges of functionality, especially on mobile phones.  Similarly, more vendors will work together to gather and consolidate guest and operational data from even more areas of a hotel, finding new ways for management to analyze and use it to target specific guest segments and specific operational exceptions to generate more business and greater efficiencies.

It’s not going to be an easy year, but I’m very much encouraged by the creativity and persistence of the vendors, and by the ever-clearer advantages shown by hoteliers who use technology to really help their operations.

1. Less is sometimes… less – Business is still likely to be down for much of next year, staffing levels will continue to be below recent norms and yet hotels must look for incremental revenue.  Implication: managers will be pressured to improve their systems, to relieve the operational burden on their staff.

2. Auto, Automate, Automation – Despite traditional caution in investing in systems and software in this environment, automation in specific departments can increase RevPAR and ADR, and free up revenue management staff for proactive planning.  Automation is a winning strategy for 2010.

3. RevPAR Resurgence – As occupancy slowly picks back up the emphasis will be more on RevPAR than lose-lose price wars.  Hotels will do all they can to bolster RevPAR, from improving or updating their revenue management systems to offering new ancillary services.

4. Building for a Recovery – Hotels will get back to making what investments they can in revenue-generating initiatives as CapEx becomes slightly more available.

5. Supply Pipeline – The pipeline of new room inventory is still intact but only producing a trickle of new rooms coming online.  2010 is unlikely to see a sudden influx of new hotels, allowing existing properties more leeway to take advantage of slow but real occupancy growth.

6. ADR Rising – Business travel is poised to make a comeback though probably not to 2007 levels.  Hotels’ decreasing reliance on deep discounting will lead to higher ADRs which, if combined with effective revenue management to optimize occupancy, will in turn lead to improved RevPAR.

7. Information is King – For 2010 efficiency is an imperative, and especially so to leverage available information effectively to improve rate setting and establish a competitive edge.  Revenue management systems that use information on competitors’ rates for optimal rate adjustment will continue to gain favor.

8. Bit by Bit – The smallest but well-timed variations in offered rates, particularly over multiple online channels, can make the difference between optimized occupancy/RevPAR and lost revenue.  Hotels will become increasingly aware of the benefits of real-time rate adjustment and will invest in automated systems to manage this.

More than anything, innovative properties and chains will eke out a considerable competitive advantage over their lagging peers. There are always opportunities; in 2010, the key will be seizing them when they present themselves.

That demand is also becoming more mobile.  A survey by SwissCom reports that mobile phone bandwidth usage is about to match that of laptops as phones become travelers’ main source for finding and acting on information; at its partner hotels the average volume per handheld session is now 86MB, with an average session length of 14 hours.  The explosion of social networking is also driving bandwidth demand up, and not only just for messaging.  Ad-Ology research reports over half of 18 to 34 year olds saying that social media influenced their choice of a hair salon or day spa, and more spas are taking advantage of that to allow online booking.

Where does this leave hotels faced with having to satisfy their guests’ incessant bandwidth demands for high-speed access or be labeled “undesirable”?  Some of that demand will undoubtedly be siphoned off by travelers moving to the new wide-area 4G wireless networks slowly coming into use, such as WiMax and LTE, which will let them access their own entertainment independently of the hotel network.  However, this won’t have a noticeable impact for some time, and meanwhile ever more guests see streaming video as part of their evening entertainment on the road, often overwhelming hotels’ total available bandwidth.

I don’t see an alternative to hotels having to pay for significantly more bandwidth than at present, and to having to pass on some of the costs to their guests, probably on a tiered-access basis.  So I think we’ll see less free WiFi in the future – or at least, free WiFi at usable speeds – and travelers will, reluctantly, accept it.  Or, perhaps, adopt pricing plans from third parties (Boingo, et al) that include service at multiple hotel chains.

However, there’s an upside for hotel operators upgrading their network capabilities; even if guest demand does slow down a little in the future, their staff will have a first-class platform on which to build much more efficient operations.  After all, if the younger generation sees texting as an inherent part of their lives, why not leverage it to make them more effective in their work?

In comparing the list of both Regular and “Green” awards over the last four years two things struck me.  One, the Best in Show winner is quite often a Technology product, and often also the winner in that category too.  Two, that to the Editors’ Choice selection panel, “technology” appears to mean “guestroom device”.

For example, the 2008 Best of Show winner was LG Electronics’ ART COOL picture air conditioner, and Earlex’s Raycop Anti-bacterial Handheld Vacuum won the Technology award.  In 2007 INNCOM won Best of Show, as well as the Green Technology category, for its e4 Smart Digital Thermostat with ecoMODE.  In 2006, Best of Show and the Technology category award went to Minibar Systems for its Smartcube system.

This may be because hardware devices are easier to see and evaluate, but it does seem odd to me that software applications don’t seem to be award-worthy.  It may be harder to see the elegance of their design, but they usually have a far greater impact on hotel operations and profitability.  Maybe this is another example of the renowned reluctance of hotel owners and operators to spend money on technology that the guest (and perhaps management) can’t see or touch, but I challenge the judges to cast the net wider next year.

Partnerships work. The results achieved by HTNG’s workgroups are one example, though by no means the only one, of what can be achieved when competitors see a way for everyone to benefit, trust each other and work together to achieve that. Certainly my clients appreciate multi-vendor teams that cooperate well to implement an effective system, and are much more likely to buy from them in the future.

Lisa Barone emphasizes a different aspect of this, namely the value of developing a partnership relationship with your customers – see her blog at http://bit.ly/2xhMGd. Regular, meaningful interaction with customers to the extent that you can watch what they do may tell you that they actually don’t want all the bells and whistles you feel compelled to add to your product; often they just want to make existing functions work more simply. If something doesn’t work well for them they’ll quickly develop workarounds in Excel, Outlook or Google Documents that are easy to understand and get the job done.

This offers a whole different benefit to the refresher training I’m constantly urging clients to schedule with their vendors. The hotel staff will always benefit by learning how to operate their systems more effectively, but the vendor has a golden opportunity to find out what’s truly important to them on a day-to-day basis. You can’t always discover this by talking with them, but if you’re on site you can watch them and take a look at the work-arounds they find useful. Trust and a willingness to listen to each other are the keys.

Some hoteliers have taken to it well.  The Los Angeles Bonaventure made headlines as one of the first to offer a limited number of discounted rooms only on Twitter, and the Rancho Bernardo Inn’s John Gates is building a good following with his often whimsical offers as the GMGoneMad.  The ROI may be low so far, but because the investment itself is a minimal amount of time any return at all is beneficial and the positive PR impact is significant.  And now a provider of short-term hotel bookings has opened a Twitter channel (see news item below).

But while many companies are making money off Twitter, how on earth will Twitter itself keep going?  As a free service it hasn’t turned more than a minuscule profit since it started, and the strict 140-character message format that’s the key to its success doesn’t lend itself to carrying advertising.  I asked this question at a HITEC seminar, and received the somewhat callous response that if Twitter itself fails, something else will pop up to take its place, so don’t worry.  I’m sure that attitude isn’t shared by those who have funded it so far, nor by those who reportedly just injected another $100 million into the company to keep it going while it comes up with a viable business model.  That will buy them time to think of ways to make it pay without killing its appeal, but they’ve had plenty of time already and this clearly can’t go on for ever.

Twitter has become universal and useful as a free service, but unless its backers are philanthropic enough to run it as a public service at some point it will have to morph into something else.  Maybe if we have to pay per message the flood of “what I had for breakfast” postings will evaporate.  Let’s hope so.

One is that most of our front desk systems have been around for many years, and their user interfaces are seriously old-fashioned compared with what younger staff members are used to seeing in their personal lives.  Another is the younger set’s general lack of patience with the established way of doing things.  Not only do these issues create a learning hurdle, they’re also a deterrent to trouble-shooting when something unexpected happens.  There’s often a tendency to find a quick work-around to the problem, either within the system or manually, rather than understand where the problem comes from and fix it. 

There’s not much we can do in the short term about modernizing the user interfaces, but this increases the importance of management pro-actively encouraging the staff to stick with the systems and not try to by pass them.  The systems aren’t going away, and it’s a requirement of their jobs that the staff use them.  But it makes it much easier to persuade them to do so, and to make detailed notes of exactly what went wrong whenever there’s a problem, if the hotel invests in regular refresher training.  Far too few do so, but it’s an investment that pays off immediately in more effective use of the system, faster problem resolution with the vendors and improved staff morale.

Chris Brogan brought this up again in his blog (http://bit.ly/OfrVo) saying that he connects on LinkedIn to virtually anyone who asks, maintaining that on Facebook “the term “friend”…is just what the software calls the connection between two people” and saying that we shouldn’t get hung up about it.  I have to disagree; can’t we please aim to keep SOME meaning in the English language?

A “friend” is someone whose company I enjoy (virtual or real-world), someone I feel comfortable calling for support or sharing personal information with and who I trust enough to consider my feelings before sharing with anyone else.  It doesn’t mean “someone who came across my name somewhere and who wants to be seen by others as having some kind of personal connection to me.”

It may be simple in writing to distinguish between the two as “friends” and “Friends”, but given the general inaccuracy of most social correspondents on-line I’d hate to have to rely on that.  If we’re communicating verbally there’s no way to tell, hence the time-wasting need for  “Facebook Friend” as a clarification.  And it IS a need; it’s a shame that Facebook has co-opted the word to imply something it doesn’t, but real “friends” are too valuable for their meaning to be lost this way.

Chris also claims that agreeing to a request for a direct LinkedIn connection is not an endorsement.  But if someone I’ve never met but who is connected to me on LinkedIn at the Second level (i.e. we have a contact in common) asks me for a direct connection, what purpose does that serve other than to imply that I know him (or her) better than is actually the case?  And what is that other than a tacit recommendation or endorsement?  Robert Scoble agrees (http://bit.ly/TG2Pr) and expresses himself more eloquently than I, but again, real business connections are valuable and useful things.  Let’s not debase them by claiming they exist when they don’t.

This means that you can now sign up for an RSS feed to it for automatic notification whenever I post the latest tech news, a blog entry or a new article.  It also means that you can leave comments on any of my posts, so don’t leave me in the dark!  Argue with me, suggest alternative thoughts or topics I should write about, but say something.

The Search function is the same as before, allowing you to search through all my old articles and newsletters and providing the context for each result.  So far I’ve migrated the last 18 months of TechNews and the last eight years worth of Hospitality Upgrade articles, which should give you plenty to start with.  The rest will be there in a few weeks, probably in mid-September when I return from vacation.

To all of you who’ve been asking for an RSS feed for so long, thanks for your patience!

At a time when so many hoteliers are looking to do the minimum upgrades they can to stay afloat, implementing just the essentials without going for the “nice to have” enhancements they’d been hoping for, it’s refreshing to see vendors continuing to develop their systems enthusiastically. Just recently I caught up with couple of established vendors of systems targeted at smaller properties, and was pleased to see what a good job they’ve done in re-writing their applications on more modern platforms. They’ve also found success outside the traditional lodging industry, finding ways to tweak their applications for similar-but-not-quite-the-same verticals.

I’ve also looked at a couple of newer arrivals from Europe aiming at much larger fish, with very comprehensive systems that have been in development for some time and show some nice, original features. And kudos to Micros, too, while I’m at it; with their dominant market share they could probably get away with resting on their laurels for a while, but I’m constantly pleased to see how much extra functionality they’re able to keep adding.

Of course, no vendor does everything – if they ever do I’ll probably be out of work – and as I mentioned after HITEC it’s encouraging to see their ever-growing ability to work together in flexible combinations to offer what hoteliers are looking for. Teamwork rules, and I salute the industry’s optimism!