The cost of saving on technology.
By Chris Hartmann and Beat Barblan ~ HVS International
Friday, 19th May 2006
Hoteliers' lack of attention to technology details can lead to significant amounts of lost revenue.

I recently attended a three-day sales conference in a major resort hotel. The location was chosen because of the relatively inexpensive airfare, reasonable, all-inclusive room rates, the availability of adequate meeting space, beautiful surroundings, and last but definitely not least, the promise of sufficient technology to satisfy business and leisure requirements alike.

In addition to sales representatives, branch and area managers, marketing and IT directors, the attendee list included a number of company executives from all over the world, their spouses, and in some cases their children. The agenda promised the usual variety of presentations, workshops, training sessions, role playing exercises, as well as award dinners, cocktail hours, and a free afternoon to rest and play.

The objective was for the participants to learn the details on the latest, soon to be released products, gather new skills, get to know one another better, communicate face to face, evaluate potential synergies and future opportunities, share their tricks and visions, and also have some fun. The expectation was that in the after hours, in the comfort of their rooms, or in suitable common areas, people would be able to catch up on the work "back home" via easily accessible high speed internet connections. The ubiquity of laptops at the departure airport security check and in the hotel lobby a few hours later, was evidence that all were ready to "hook up" and at the very least, catch up on some of the daily e-mails that would be received and needed answers regardless of where the addressee happened to be at the time.

The three-day conference was a success. Products were presented and explained, questions were raised and answered, information was shared, connections were reaffirmed and strengthened, new business opportunities were identified, and for the most part, people had fun too. The resort facilities were excellent. One would expect the attendees to want to return to the same location next year. Yet surprisingly, when surveyed, almost everyone agreed that they would not. Why? For essentially two technology-related reasons: 

  • Inadequate availability of high speed internet access (HSIA)
  • Insufficient and low quality in-room entertainment options
As promised by the hotel operators during the booking process, HSIA was indeed available at the hotel but not where and how we wanted and needed it. The business office, a tiny room with very limited connections, offered HSIA at a prohibitive premium. Wireless was available in the hotel atrium, next to the dance floor area (ear plugs anyone?!), not ideal for conducting business.

Occasionally, we could also pick up a wireless signal in the conference rooms and answer e-mails while pretending to be focused on the speakers or workshop leaders. Connections in the guest rooms were not much better: expensive and hardly high speed by any standards. The end result was that most of us returned to our offices to face mountains of e-mails that at least in part, we expected to be able to deal with while at the conference.

The in-room entertainment, or lack thereof, didn't help either. There were an inadequate number of free-to-guest channels and reception and the picture quality of the older TVs, quite poor. To make matters worse, the pay-per-view choices were expensive and also quite limited, especially for families. This was particularly frustrating for those attendees who brought their children expecting them to be able to watch TV during some of the time their parent was attending the conference. I can tell you first hand that having kids around who cannot watch TV, chat online or even surf the net, is not a pleasant experience. More than one colleague traveling with his family remarked that his kids were sorry they came, despite the luxury of the surroundings.

Inadequate internet connectivity coupled with limited in-room entertainment options were enough to convince this group to switch to a different hotel next year. From the perspective of the hotel, this means a loss of $60,000 (our bill this year) in revenue and potentially more considering lost references and bad publicity.

Today's guests, whether they are traveling on business or for leisure, expect the technology in the hotel they are staying at to be at least as good as what they are used to at home. In some cases, especially for business travelers, it is imperative that this be the case since it is expected that they be able to continue conducting business while away from the office. With an ever-increasing work demand and the challenges of balancing home and office, making the travel experience as pleasant for the family as it is for the attendee, is critical.

The lesson to be learned from this example is simple and clear: Identifying and meeting the guests' needs for technology is an essential component of hospitality sound business practices and has a direct impact on revenue. While in general no one would argue against saving on costs, to do so at the expense of essential technology is penny wise and pound foolish and ultimately costs far more in lost revenue opportunities than it saves in expense.

chartmann@HVSit.com or bbarblan@hvsit.com 


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