The Lucky Bag: WLANBy Michael Toedt - Managing Partner and CEO at TS&C GmbH
Data has become the new gold in the Big Data era. When you look at the business value of companies such as Booking.com, AirBnB or Uber you can see the immense value of data. All these companies would have no basis for existence without the data they are generating.
Hotels also create huge amounts of data. One massive data source is the WLAN, a system hardly anyone pays attention to or makes use of. This, however, is a big mistake! There are calculations according to which a 200-room hotel gives up around 280,000 Euros per year by not tapping into this potential.
WLAN is generally considered a financial burden. In a study conducted by the Munich University in 2015, leading hotels in Germany were asked for the ROI of their WLAN investments. The hardly surprising result was that none of them had a ROI calculation.
A well-functioning Internet connection has become standard in hospitality. The quality of the Internet connection has even become one of the key decision-making factors during the search for a hotel.
According to network provider Ericsson interruptions during video streaming, i.e. when watching movies via the PC, Smartphone or Tablet, cause a level of stress, which can be compared to that watching a horror movie. This reinforces the importance of high-quality Internet access at hotels.
Nowadays, more than 90% of the consumers travel with mobile devices. Business travelers go online with up to three devices. This trend is referred to as BYOD (Bring Your Own Device). Moreover, travelers increasingly want to consume their own content. This phenomenon is referred to as BYOC (Bring Your Own Content). Guests no longer want to search hotel TV for interesting programs, but prefer using streaming platforms such as Youtube to satisfy their own preferences at any given time. The increased use of video requires an increase in bandwidth and considerable investments in hard- and software. The challenge is, however, that guests are no longer willing to pay for high speed Internet access. It has become a basic need, which they expect to be fulfilled without annoyance. But is there a way to make money with WLAN? Yes, there is by intelligently using the generated data.
In order to do this, the collected unstructured data first needs to be transferred into structured data. This can be done by forcing the guest to register and to identify by adding the contact data to his guest profile. By doing this, useless, unstructured data is changed into structured data and the system recognizes an actual person and no longer an anonymous device!
Due to the increasing share of OTA bookings, e.g. via Booking.com, fewer and fewer hotels have the full contact details of their guests, as the OTAs provide them only with the first and last name of the guest. Upon arrival at the hotel, the guest is either not willing to complete his guest profile or the hotel staff fails to ask for the details. As a result, most hotels only have contact details of less than 30% of their guests. Thus, only a fraction of the guest data is stored in the hotel's CRM system. But if a hotel does not communicate directly with its guests, there is no chance to generate direct bookings. This makes the hotel even more dependent on intermediaries such as HRS.
About 75% of all guests go online and so do their partners, friends, other meeting participants, and external visitors of the restaurant, spa or the bar. Contact data of all these people can be collected and used in the CRM.
But this is not all: Like a GPS system, modern Access Points can identify the location of a user with an accuracy of one meter. If this data is integrated in a central data management system, the hotel can see how long a guest spent at a specific location. Like Apple, Google and Co. they can use the previously unused data to see movement patterns of guests and thus learn what their preferences are. Communicate with the guest is possible in real time, based on his location. Also guest recognition works in real-time, which can help to enhance the service level. Further, the WLAN data can also facilitate staff planning. For example, if housekeeping receives an alert after a certain number of guests have used the gym, they can go and check the facilities when there is a real need, instead of working according to fixed cleaning plans.
Some will probably throw their hands up in horror; but others will see the potential. But don't forget – it's better to move with the times than to be removed over time.
If you want to see your potential, find out about SmartWireless and turn your available unstructured and almost useless wireless data with dailypoint™ into a highly valuable asset.
Dr. Michael Toedt is the founder and CEO of Toedt, Dr. Selk & Coll. GmbH, a leading Big Data Marketing and CRM company. Operating at the intersection of business and technology, he helps hoteliers with the software dailypoint™ to use the tremendous increase of data in order to become data-centric. Dr. Toedt has over 25 years of experience in operations, technology and marketing. He is the author of several books (among others “Big Data – Challenges for the Hospitality Industry” (2013) and “Data Revolution – How Big Data Will Change the Way of Doing Business” (2014) and his articles are published by journals on a regular basis. Dr. Toedt holds a doctoral degree in management science. He is assistant lecturer at the University of Applied Sciences of Munich for the subject “Customer Relationship Management in Tourism” and as guest lecturer at various universities such as the University of Applied Sciences of Bad Honnef, Kempten or NDS Hôtelleriesuisse. In the past, Dr. Toedt was regional vice president of SANSORA INTERNATIONAL, a subsidiary company of the Schoerghuber corporate group and accompanied many hotel associations during the production of their central customer and marketing data base. He was raised in his parents’ hotel and after completing a mercantile apprenticeship he graduated as cook to be employed in the 5-stars restaurant Hotel Koenigshof in Munich. 1995 he began his business economics studies at the University of Applied Sciences in Munich. During this time he visited the Cornell University, NY and is now President of the German Chapter.
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