Location, location, location. While real estate agents have always known the importance of that saying, in recent years, the hospitality industry has also adopted the mantra. Location-based technologies are — in a word — hot. While most hospitality uses so far are tests and pilots, 2016 will see rapid adoption: 20% of hotel operators queried for HT’s 2015 Lodging Technology Study revealed that they plan to roll out the technology within 18 months, and 28% of restaurants surveyed in the 2015 Restaurant Technology Study intend to add beacons to their technology strategies.
The Location-Based Marketing Association (www.lbma.org) calls location data the cookie for the physical world because beacons, GPS, WiFi and sensors on phones add context to data by identifying location, just as Web cookies do online. Knowing a guest’s location at a specific time helps hotels and restaurants tailor messaging and experiences and yields deeper insights into customers’ behaviors and patterns.
“Ten years ago guests expected a consistent experience across the brand,” says Chip Rogers, president and CEO of the Asian American Hotel Owner’s Association (www.aahoa.com). “Today they are looking for a tailored, individual experience. An individualized offer creates loyalty, and hotels can do that using location data.”
While hospitality has been slightly slower than other industries to fully embrace location-based opportunities, here are tips from experts both in the hospitality field and beyond to help define a technology roadmap that includes location-based elements.
1. Start small. Even though the range of opportunities is wide, from sending a welcome to a guest when he or she hits the airport geofence to finding them at the pool with their order, don’t try everything at once. Gravy , a location-based behavioral analytics provider, urges its customers to start without preconceived notions, because others have found unexpected value in surprising places.
With that said, don’t make pilots too small either, cautions Turnstyle Solutions, which leverages WiFi for location-based marketing. Start with several sites to benchmark against each other and provide more data to spot trends. Try that for six months to A/B test, identify KPIs and fine-tune the project.
2. Have a goal. Don’t deploy because competitors are doing it. Tie location projects to corporate goals. A group of 54 Subway stores (www.subway.com) in Northern Ontario, for example, sought more consistent Wifi, better understanding customers and increasing loyalty and redemptions in a TurnStyle Solutions’ Wifi program’s first four months. Subway is able to drill down to know actual consumer behavior by linking to specific WiFi devices that opt-in to a particular location. The project delivered a 17% redemption rate and customers responding to the first offer subsequently visited 5.2 times more often.
Just as the Chicago Cubs were starting to surge last summer, Sports World (www.sportsworldchicago.com) saw an opportunity to capture more traffic and fan info from across the street at Wrigley Field than they were getting via Twitter hashtags. They used Geofeedia (www.geofeedia.com), a location-based social media monitoring platform, to place a geofence around the park and neighboring businesses. “We’re building a huge list of followers from Twitter, Pinterest, Facebook, etcetera, and are able to engage them to come into the store or shop later,” says Bradley Rosen, Partner at Sports World, making a positive impact on revenue. “It’s more cost effective and it’s microtargeted.”
3. Prepare your environment. Thanks to open APIs, most companies dealing in location data say they can integrate with most any CRM, PMS, POS or other legacy system. Digital ordering and engagement company Tillster says modern platforms and maintaining a common version across the chain make it easier. By outsourcing to vendor partners that can leverage modern technologies such as Hadoop, NoSQL or MongoDC, hospitality companies can sidestep inflexibility in internal software and gain fast access to sophisticated segmentation and personalization technology, adds experts at mobile platform developer Smith Micro.
To prepare, vendors advise taking a close look at data quality. “I use Regal Cinema’s locations’ data and technology to accurately target consumers based on their whereabouts,” says Michael Carroll, manager, mobile, web & emerging media at Regal Entertainment Group (www.regmovies.com). Regal uses digital marketing platform MomentFeed (www.momentfeed.com) to deliver geo and behaviorally targeted messaging. “The two go hand-in-hand, because if our own data is inaccurate, then we won’t be able to accurately target the right person at the [right] place.”
On the hardware side, consider boosting Wifi or cellular signals and bandwidth throughout the venue.
4. Choose vendors carefully. Understand the vendor’s business model, which ranges widely. Zonetail (www.zonetail.com), for example, offers its app and geofence services for free and makes its money charging local businesses to show up on the app when guests look to see what’s around the hotel.
Some vendors charge monthly service fees for beacons; buy them instead and pay for software and service. That’s what many companies, including geomarketing and mobile software company Roaming Around do, the company advises.
5. Make sure the solution will scale. At $30 a pop, a beacon is cheap. But 10 beacons each across a thousand sites adds up. Gimbal (www.gimbal.com) a mobile engagement platform, recommends that companies consider installation and support costs — if they don’t run on USB power, for example, beacon batteries only last about 18 months.
Cloud architecture goes a long way toward helping scale across a brand and the multiple solution providers involved in location solutions, according to Cisco (www.cisco.com), while helping guests enjoy a consistent experience.
6. Set the right metrics. Incremental revenue, return visits, guest satisfaction rates, bookings – all are important no matter the marketing approach, but location-based marketing can also be measured in things like dwell time or how frequently customers pass by and DON’T engage, or visit a competitor.
7. Make data actionable. Create and automate rules via marketing and operations platforms to instantly act on location data. Mobstac, which uses beacons for proximity marketing, suggests integrating location data with existing customer service and sales staff to enrich their interactions with guests. Hyatt Regency Santa Clara uses tech provider Cisco’s locationing solutions with heat mapping to dispatch staff when a certain percentage of guests congregate at a location, or targets guests with dynamic digital signage. Geofeedia recommends integrating location data with a social media command center, so staffers can quickly match a site to a guest’s social media comment. Also apply rich analytics for longer-term insights, such as using heat mapping to detect guest movements to shape space planning, vendor rent rates, and so on.