How is IoT revolutionising the hospitality industry?

With Intel estimating that in the next three years, there will be 26 smart objects for every human being on Earth, and with McKinsey estimating a potential global economic impact of up to $11.1 trillion a year by 2025, it is clear that IoT will revolutionise the way we do business, irrespective of whichever sector we may be working in.

 

Many of the top players like Marriott International, Hilton Group and Starwood’s Hotel and Resorts have adopted newer technologies to drive customer satisfaction. One thing that is common to every business in the hospitality industry is that to be successful you need to understand what your customer needs because it is one of the few industries which sees the actual physical participation of the customer in the sale process. It is also a business that thrives on the loyalty factor. So pre-empting your customer’s expectations is crucial in attaining business success.

 

This is where IoT technologies can help.

 

IoT and predictive maintenance

 

Not long ago I read about a small cafe in Sydney, Australia, called Get York Coffee, which faced a humongous loss of inventory because one of its refrigerators broke down. The day after this incident happened, the cafe’s owner, Shawn, fitted his refrigerators with sensors that could monitor the internal temperature of these refrigerators. The sensors consist of a gateway that connects to the cafe’s Wi-Fi network and hosts a web portal. The sensor unit is connected wirelessly to this gateway. This tiny sensor transforms the fridge into a ‘smart’ device by sending e-mail notifications to its operator if there is a rise in temperature above the acceptable limits. Such a notification, says Shawn, helps him place a service call before the device actually breaks down. He could also move his inventory, in time, into another refrigerator if needed.

 

This is an example of predictive maintenance, which is one of the biggest ways in which the hospitality industry can use IoT to improve their service, reduce their costs and even ultimately generate more revenue. Some bigger hotels are also using the technology to inform their staff about broken air-conditioners and leaky pipes. The Starwood’s chain recently began experimenting with an energy saving concept called “daylight harvesting”, in which an IoT device regulates the lighting in a room by turning down artificial lights depending on the amount of natural light that comes in. Businesses are also talking about using Iot devices and big data to map and store a guest’s personal preferences to automate the same during future visits.

 

Mobile and wearables: The hub of IoT

 

Imagine the possibilities arising out of connecting smartphones to other IoT-enabled devices? Take for instance, the Hilton group’s digital keys feature, in which you can stand at a stipulated distance of your hotel room and open the door by just tapping on the digital key in the hotel’s app.

 

The same technology is being used to automate or regulate the energy and lighting settings in the room of many hotels around the world. This sounds like a win-win situation to me–the hotel can cut down on unnecessary labour costs and the customer can get fast, uninterrupted service, literally “at the tip of his fingers”. In fact, a Magnani Caruso Dutton survey found that 74 percent of the 1,000 travellers surveyed preferred that their hotels were “proactively involved” in making their visits better. This meant that the customers were perfectly okay to relinquish a bit of their private information if that meant they would get a better experience for what they paid for.

 

Another huge area where the IoT is creating a wave is wearables. These devices are moving beyond the fitness, health or caregiving industries. In fact, some hospitality groups have already started incorporating wearable bands to give the customer access to the property and allow them to set or go back to their personal preferences while travelling within the properties of the same group. A great example of this is the MagicBand by Disney. The band helps sync your whole Disney experience in one device and allows customers to unlock their rooms, enter theme parks and even charge food and merchandise bought at Disney properties to their hotel room account.

 

The way ahead

 

Hotels around the world have already started experimenting with various IoT-enabled devices and technologies. Some prime examples are that of the Marriott International’s M-beta concept, which takes real-time feedback on services through touchpads placed throughout the building and adapts accordingly, to Aloft Hotel’s Project Jetson, which allows guests to adjust ambient settings in their room and much more by just ‘voicing’ their desires.

 

These examples are proof enough that the future is, in fact, right here. By incorporating IoT devices to your operations seems like a logical step to take in these times. If done right, after proper assessment of your assets and proper infrastructure to ensure data security, IoT will be the key to shaping your hospitality business into a success in the near future.

 

references:

http://www.intel.com/content/www/us/en/internet-of-things/infographics/guide-to-iot.html

http://www.iothub.com.au/news/how-iot-saved-a-sydney-cafe-thousands-433160

http://www.stamfordadvocate.com/business/article/Starwood-hits-environmental-milestone-6065115.php

http://hhonors3.hilton.com/en/hhonors-mobile-app/digital-key.html

https://mcdpartners.com/wp-content/uploads/2014/12/Seeing_Returns.pdf

https://disneyworld.disney.go.com/plan/my-disney-experience/bands-cards/

http://www.marriott.com/hotel-info/cltcc-charlotte-marriott-city-center/m-beta/22umtoc/home-page.mi

http://www.alofthotelshub.com/news/aloft-hotels-unveils-voice-activated-hotel-rooms/

How will IoT influence marketing?

Today, a promising technological revolution is predicted to make a global economic impact of about $1.9 trillion by 2020 and $2.5 trillion by 2025; and it is the Internet of Things. For those unfamiliar with the term, the Internet of Things or IoT may sound like one of those jargon that IT guys throw around casually. In reality, IoT is a progressively promising wave of new possibilities and opportunities, which will give the technology we use today a remarkable boost. In simple words, it is just establishing a relationship between machines. It refers to being able to share information through every day ‘things’ or devices over a network. It is going to change the way we connect with the world around us forever.

 

According to Gartner Inc., almost 26 billion devices of all kinds will be connected through the IoT by 2020. The intelligent systems that are created by these connected devices will provide us with data that will help study and explore critical information and patterns in the world. Such data will be useful for marketers—a study by Marketo found that about 51 percent of the world’s top marketers agree that IoT will revolutionize the marketing landscape in the coming four years. With IoT, marketers would be presented with the enormous opportunity of interpreting data from smart devices to evaluate consumer behavior, identify trends and tailor campaigns accordingly. But that’s not all. Let’s see how IoT will influence marketing as we know it in the near future:

 

Better mobility of data: The core of IoT lies in being able to share information over a    network. Information thus shared would be something that is extracted with the permission of the user and would translate into a marketer’s goldmine. With the devices doing all the work automatically, better and easier transfer of data will be possible. It will also be easier for a marketer to lay his hands on earlier unavailable data or information that was too cumbersome to collect.

 

Real-time, specifically targeted marketing efforts: This is especially true if we are talking about the customer’s in-house or in-store experience. A real-time exchange of data becomes possible, thanks to multiple IoT devices that sense location, and track the customer’s buying journey. Armed with this information, a marketer will be able to figure out if a customer is indecisive about the choice he needs to make. In such a scenario, the marketer can speak to the customer in real-time or send them a message on their authorized, registered phone number, maybe offering a discount or so. In effect, here, a consumer’s data collected through various IoT devices are being used as a raw material for real-time, specific marketing efforts.

 

Increased customer understanding: Why has social media become so popular? Because, it builds connections. IoT, too, is all about building new connections and making older ones stronger. Being connected to an extensive network of devices only means that communication becomes swift and meaningful. Instead of providing feedback and taking time to collect this information and act on it, now marketers will be able to receive feedback instantaneously and come up with remedies sooner. Such a level of connectivity also translates to better analytics. For instance, suppose your business sells coffee from a vending machine. The data collected from the purchases made at the vending machine will enable you to track patterns in consumer buying and also understand the demographics of purchase and consumption. Does the purchase rates spike during a certain time of the day? How often are purchases made and within how much time of one another? Such information will provide marketers a good ground to base their targeted and personalized marketing campaigns on.

 

Better click-through rates: With IoT, marketers are finally reaching their all-time aspirational high of ‘relevant advertising’. Campaigns and ads will be more streamlined, personalized and specific. This means that as a consumer you will see less and less of information or advertisements of things that do not matter to you; instead you will be rewarded with information of what you really do need at the right time and place. This will also ensure that marketers can be assured of better click-through rates and engagement for their campaigns.

 

IoT offers tremendous opportunity when it comes to customer engagement and marketing. Marketers are able to tide through two of their most important struggles—one being why consumers are interested in your products or services, and the next being that it opens the door for real-time interaction with your end-users or buyers. Although, some of you may feel a bit skeptical about privacy issues, and the kind of personal data that will be collated and used to market products and services to you, I would want to remind you that only if you allow the permission to a smart device to do so, will it be storing your data. The choice is still yours. Despite the many challenges it comes with, like infrastructure concerns, connectivity issues and security concerns, I cannot help but be optimistic about what IoT holds in the future for businesses like ours.