If I have to pick an industry that’s most affected by the so-called “sharing economy,” it would have to be the hospitality sector. After all, isn’t Airbnb the perfect poster child of the sharing economy? Throughout the past 10 years, we’ve witnessed many spectacular promises and hypes. It’s time to hear it from the field.
How hospitality brands are engaging with mobile users
I sat down with Marco Lafrentz who heads tyntec’s cloud communications business, and two executives from one of the most renowned hotel chain brands Marriott. Margarita Yakovleva, Director of Sales at Aloft Abu Dhabi; and Hisham Ishak, Complex Direct of Marketing at Sheraton Abu Dhabi, and Le Meridien Abu Dhabi. Leading the customer engagement initiatives at one of the most prestigious hospitality properties — in one of the most upscale markets in the world — both Margarita and Hisham bring unique insights to the topic.
Q: Let’s start by looking at the impact of the sharing economy — the anticipated disruption to major hotel chains. Is the hype justified?
Hisham: If we’re talking just about Abu Dhabi, where there’re no serviced hotel apartments, I would say that the revenue impact from players like Airbnb has been negligible. More direct impact comes from the OTAs [online travel agencies], like booking.com and Expedia. Naturally, we would like to get more bookings through our direct touchpoints.
Margarita: Yeah. Definitely from the sales side, it’s more about the overall digitalization and the transparency that it brings to our clients. The fact that anyone can instantly see a list of available hotels from hundreds of various sources certainly makes my job as the sales director more complex.
Q: It sounds to me consumers are in the driver’s seat — how does that change the way businesses make decisions and engage with their customers?
Marco: Digitalization is definitely forcing all businesses to be more transparent. It forces the enterprises to push more information out to consumers, in an easily digestible way, and to invest heavily to gain speed in adjusting to changes and competition.
From a consumer perspective, it’s a very good development because digitalization is fostering competition, especially direct competition, causing the companies to make different departments work closer together, because you have to make the internal decisions much faster.
It’s not just the 24/7 customer service desk anymore, with mobile phones in their hands at all times, consumers are communicating and transacting whenever they want. And that spans across the entire customer journey, and involves multiple teams, either directly or indirectly.
Q: Another aspect of digitization is speed. The speed in which brands need to respond to customers. Is the hospitality sector more impacted by this?
Hisham: Before joining Sheraton, I worked at Victoria’s Secret. Compared to the fashion industry, I would say the hospitality sector is a lot more dynamic. We need to adapt in real time in many cases. Market conditions, local or regional, or even global issues, affect our business quite dramatically. If we fail to respond in time, in real time, we get left out. Yes, it does happen sometimes.
Margarita: Definitely. The whole cycle becomes much faster. And I think communications has a lot to do with it. With mobile apps, more people seem to make their decisions at the last possible moment. They know there will always be something available; they would do the research whenever they’re ready and just book it whenever it’s convenient for them. I think that has a tremendous impact on how we do business now. We’re looking at it as a way to stay ahead of the competition.
Q: Premium hotel brands like Sheraton and Aloft provide more than just rooms. Any differences in how you engage your guests for different types of services or ancillary services?
Hisham: Between the two brands I manage, Meridian and Sheraton, we have around 23 food and beverage outlets. Food and beverage in the Middle East is a massive business. To put it in perspective, between the two properties, 50% of our soft line revenue come from food and beverage. And that’s where we’ve been having many massively successful campaigns, with about 60% of the audience engagement coming through social media.
One of the interesting things we learned from the campaigns is that our food & beverage guests are totally different from our restaurant customers. Bar-specials campaigns to our Italian restaurant followers on Instagram was a total flop. We tested it and learned the lesson very quickly.
Marco: I’m glad you shared that example, Hisham. No matter which communication channel is used (messaging, voice calling or social sharing), each interaction needs to be shaped according to the users and the use case. The aim of many recent developments coming out of the communications industry, where I work in, is precisely to help brands focus on those aspects, rather than on technological merits of different tools.
Hisham: That actually echoes what our team has been trying to accomplish with our corporate initiative called Drive To Digital. A communications tenet of the initiative is to reach the right audience at the right time at the right place. In the past, say four years ago, we were mostly using mass communication, often resulting in poor ROI. We’re now definitely seeing how communication technologies have evolved to provide more seamless and deeper engagement with our guests around the world.
Q: Interestingly enough, communication works both ways. What are you doing differently when it comes to customer feedback?
Hisham: Communication is super important to us. We take customer sentiment as one of the most important indicators of our business. We believe the genuine sentiments of our customers, in their own words, are often more powerful than what we say about ourselves, about our own services and so on. When our guests pour their emotions out on social media or other digital platforms, we know it has an impact on our revenue. So, we make sure that we take care of each customer to prevent negative feelings from bubbling up.
Marco: With online transparency and the immediacy of customer feedback, brands are very aware of how the sentiment of previous customers shapes the next customer’s evaluation of their brand, even before interacting directly with the brand or purchase something. Many companies, across different industries such as financial services, airlines and insurance, invested heavily to scan all of those feedback channels, and most of these feedbacks are given in text format, where customers give a rating and then leave a comment. So, many tools are being developed to help brands monitor different channels, process and then forward them for proper mitigation and handling — which often triggers a two-way communication between the brand and the customer. I think the real challenge is to prevent negative things from happening.
Margarita: I totally agree. Trying to make the guests happy while they’re in our hotel, and rectifying the problem while they’re still with us, is key. So, we always try to get their feedback at our front-desk and engage with them before they leave the hotel.
In addition, as a leading hotel chain, we do have various programs and channels to monitor customer sentiment. Our loyalty program, one of the strongest in the industry, is a great example. We take great care of our loyal clients; some of them even get lifetime support wherever they travel around the world as our special global ambassadors.
Q: Any major changes you’re experiencing in terms of the type of content consumers are responding to?
Margarita: Something I find very exciting is what people are actually interested in knowing about the hotels these days. We realized they are interested in seeing a lot more of live video content. For example, last month we invited one of the bloggers to do a real-time Facebook interview, and to tour the hotel. We were excited to see that a lot of people watched the video. I think many of them are preferring to see the live video over the photos or videos that look commercially produced and published on our websites.
Hisham: Whether it’s working with influencers, bloggers, these are, again, sentiments. These are real-time and authentic. Not a commercial. So, we take that as a referral business. In the past, we used to be rather generic on how we respond, communicate, and connect with this kind of engagement. But with the changing consumer behavior, we now take it very differently, we engage with them, actively and in their terms.
Q: Looking ahead, what other changes you see becoming more important in your business? Some might point to communications becoming more context driven. Your thoughts?
Margarita: For Aloft, I would say, on-premise communication with the guests. Aloft’s customers are very tech savvy. We reflect that customer insight to many cool services we provide in our hotel. Our Emoji Room Service is a great example. It’s a cool way for our guests to order food or snack right from their rooms by using emojis via WhatsApp. The service was launched globally. As a global premier brand, we do have the operational power to deploy such initiatives, which is a big plus for us. Again, it’s all about understanding our clientele. They tend to be young, trendy and tech savvy; and open for newer, more personalized services, right from their mobile devices.
As more new communication tools become available, brands will have to be more creative and explore new ways of communicating with the guests. You really don’t want your guests to be bored, especially the ones who like to try new things.
Hisham: One of the new things we’re seeing in the digital space is AI, artificial intelligence. That’s going to be the way forward, in many ways. Chatbots being one of the recent examples. One thing to note though, when it comes to many social media chatbots, consumers show very little interest when the interaction seems too artificial. Although we’re exploring AI as an option, I don’t think we can actively use it until the technology matures to a stage where it can respond to consumers beyond just saying, “Okay, we’ll get back to you,” or any other set phrases like that. I still feel that human touch plays a bigger role even on the backend when it comes to bridging the gap between consumers and businesses.
Marco: A great point! Tools will constantly improve. But brands need to understand when and where a human touch is critical. And that can have two levels. It can either have a value creation touch, as we’ve seen it in the loyalty program that Margarita mentioned, where relationship aspects play a big role in shaping a good experience with the brand. The other level has more to do with completing a critical transaction such as buying, where the interaction needs to be directed and taken further, rather than just answering a question for instance.
Many brands are discovering the same. No matter how direct or indirect the engagement is, whether you’re talking directly to a person, through an AI-assisted messaging apps, or a social channel such as Facebook or Instagram, all of these interactions need to be shaped with the audience in mind. That’s what the brands need to think about, not about different channels and technological particulars of each option.
As a communications service provider, tyntec’s focus is on removing that complexity. More and more brands are adopting an omni-channel strategy where all relevant channels are already enabled, so that they can quickly select based on what they’re using it for, and whom they need to reach. Similar to how smart phones put consumers in the driver’s seat, communications platforms are bringing the channel control to companies now.