The hospitality industry is one of the fastest-growing parts of the global economy, and making sure that guest wants and needs are satisfied is one of the most important components when it comes to success. Mobile technology has emerged as a powerful new way to make personal connections with guests and provide the service and value that they demand. As more and more guests adopt mobile technology—such as smartphones and tablets—businesses have a new tool at their disposal.
As the name implies, mobile technology refers to devices and services that make consumer technology portable. It is driven by convergence, which is when formerly separate and distinct technologies are combined to create a wholly new product. One example of this phenomenon would be the converging of television, telephone, and internet technologies that created video calling through the use of webcams. The same convergence is being found in the mobile side of technology with devices such as smartphones and tablets. These products are wholly new devices, but each comes from the combination of a host of older technologies. Smartphones incorporate cellular phones, miniaturized computers, cameras, GPS technology, and audio players. Tablets are larger-screened versions of smartphones that often utilize a surround input system with touch screens, styluses, and voice commands. Both these devices have adopted the various services sought after by their older-sized cousins, including text messaging, teleconferencing, augmented reality, and instant online access. As a result of all these factors, the current generation of guests is adopting these devices at an extremely rapid pace: 65% of all Americans own a smartphone, and that number jumps to 82% for those under the age of 30. Similar statistics can be found for tablets, as ownership has risen from 3% just two years ago to 34% today.
The hospitality industry deals with creating and fostering personal connections with the guests who frequent hotels, restaurants, casinos, and other facilities. A part of these connections involves understanding the wants and needs of consumers. With the advent of mobile technology, businesses have a new and powerful way to delve into this territory and better foster guest satisfaction. Mobile technology allows businesses to directly communicate with guests on a personal level and offer various services and promotions that speak to their desires. It also creates a whole new arena of significant advances that can be made through the use of mobile technology, including guest enablement, augmented reality, interactive marketing, and creating the 24-hour hub.
Definition and Evolution of Mobile Technology
As societies became more technologically advanced, the effort to prioritize and invest in technological innovations increased, as it has the potential to improve efficiency in different aspects of establishments and companies. Mobile technology, also known as “mobile phone technology,” is the branch of technology that deals with mobile communication. Communication is the exchange of information between two or more points. It takes place between mobile phones through radio waves with the help of mobile technology.
Mobile technology, which deals with mobile communication, was introduced in the 1970s. The first mobile phone technology was “1G”; it was analog mobile technology. Afterwards, 2G technology was developed. 2G was a digital mobile technological advancement that permitted the transmission of SMS or text messages. Nowadays, new generation mobile technologies have come into being.
In the 1990s, “3G” technology was established. The third generation of wireless mobile technology allows wide-area wireless voice telephony, mobile Internet access, fixed wireless Internet access, video calls, and mobile TV. So far, more than 33 WCDMA, CDMA 2000, etc. mobile systems have entered into 3G mobile technology.
4G mobile technology, fourth generation mobile phone technology, is a global broadband Internet mobile wireless technology. This technology provides universal broadband coverage, allowing delivery of 100Mbps download and 50Mbps upload speeds. 4G technology supports and enhances different services like video streaming, online gaming, etc. Several companies have entered this race of introducing the world to 4G technology. Wi-Max, Long Term Evolution (LTE), and UMB wireless technologies are a few names amongst them.
The latest generation wireless mobile broadband technology is “5G,” where the data transfer speed is expected to go as high as 10Gbps. This technology is still at a research and development stage.
Benefits and Opportunities for the Hospitality Industry
Mobile technology has become ubiquitous in the hospitality sector. With the increasing popularity of smartphones, tablets, and laptops, the hospitality industry is adopting mobile technology for improved operations and customer engagement. Hoteliers are implementing mobile applications for booking and checking hotel amenities, resulting in reduced waiting time and quicker assistance. Additionally, enhancements in mobile technology have enabled holidaymakers to communicate perspectives and experiences instantly through social media. This is crucial since negative criticism on social media can damage a brand’s reputation, whereas positive reviews can boost a company’s profile. As evidence, several hospitality companies undertake marketing initiatives utilizing social media platforms like Facebook, Twitter, and YouTube. With the advent of mobile technology, customers in the hospitality industry have the flexibility to choose service providers based on service quality, price, and other factors.
One of the main reasons for offering mobile services to customers in the hospitality industry is to develop new revenue-generating mobile services. Individuals in the hospitality sector are undertaking the promotion of mobile services to continue attracting potential customers, thereby increasing their marketability. Since the number of mobile phone users is increasing rapidly, conducting business through mobile technology means those firms can reach a greater number of customers. Innovations in mobile technology (e.g. digital wallet, today’s mobile version of the web, short message service [SMS] as a marketing tool, and push media) have the potential to create novel opportunities for hospitality firms by providing new ways for guest interaction, service delivery, advertisement, and customer engagement. These innovations enable competition among service providers to provide more sophisticated and personalized services through mobile technology. Those with a well-articulated e-business strategy focused on services marketed via mobile technology can generate new revenue streams. Investments in mobile telecommunications infrastructure and innovations in mobile technology firms are enabling the emergence of the platform for services to be utilized by hospitality firms and visitors/tourists.
By offering personalized services that attract more visitors/tourists, hospitality firms switch from information provision-based value enhancement to service/activity-based value enhancement. This change in strategy can enable hospitality firms to consolidate their market position, increase their customer base, and facilitate sustainable growth in the long term. It is also crucial for tourism destinations to make investments in mobile telecommunications infrastructure and thereby enable the growth of mobile services in the hospitality industry.
Mobile Hotel Booking and Reservation Systems
In today’s fast-paced world, people are constantly on the go. Whether traveling for business or pleasure, booking and managing travel accommodations has now become simpler and more convenient with hotel mobile booking and reservation systems. These cutting-edge technology systems enable individuals to book hotels with just a few simple taps on their smartphones or tablets, making them a convenient option for many travelers.
Mobile booking and reservation systems come equipped with several important features, commercialization, and payment methods. A few of the features include an easy-to-use interface, registration/account management, flexible search options, comparison features, online payment options, confirmation status tracking, and customer service support options. Each of these features plays a critical role in operating the system and assisting users in making the most optimal decisions for their hotel accommodations. For instance, a user wants to book their travel accommodations. With hotel mobile booking systems, the user would log onto their account, select the desired criteria, and view an array of hotels and accommodations that best fit their needs.
The comparison feature allows the user to compare hotels based on multiple criteria, including room rates, proximity to certain amenities, or services offered by the hotel chain. Once the user has chosen their hotel destination, they would go ahead and enter necessary payment information. After the desired booking is confirmed, the system will then follow up with an email/smartphone notification confirming the reservation. If necessary, the user will also be provided with the option of canceling the reservation within a certain amount of time, depending on the stipulations set by the accommodation. This follows the idea of “reservation status tracking,” where users will be able to view the status of all reservations made through the app.
Most importantly, it is crucial that such systems receive and handle personal payment information safely. Therefore, the system will create and utilize an Online Payment Gateway, which is a technology used by merchants to accept online transactions securely. All payment and credit card information will flow through the gateway, which is then usually transferred directly to the user’s bank for approval. If the transaction goes through successfully, the money will then be transferred over to the hotel chain’s bank account, while the booking/reserving information is sent back to the hotel mobile booking system.
Key Features and Functionality
Because of current innovations in mobile technology, the hospitality sector is seen as one of the industries with the fastest growth potential. The mobile hotel booking system has become crucial in addressing clients’ expectations for accessibility and convenience. Mobile booking and reservation systems can help hotels attract new consumers, keep existing ones, improve guest relations, and make it easier for visitors to discover the hotel and book reservations.
Mobile hotel booking services allow prospective customers to search for hotels based on various criteria, view detailed information in a category or gallery view, and check the availability for selected hotels and unit types. Customers can also view reservations, input personal data for booking requests, and confirm reservations. The services enable customers to change their personal account data. For administrators, the services allow administrators to manage hotel and unit types, view statistics, and change status to book/reject reservations.
A mobile hotel booking and reservation system feeds information to a mobile client-side application in the customer and administrator areas. The user can search, view, book, and cancel reservations. The administrator can add, edit, and delete hotels/rooms, view statistics, accept and reject reservations. Information is gathered and stored in a database. A database design is a logical structure that describes the data stored in a database and the relationships between them. Input data are details describing a certain entity and their types. The database fulfills the system needs, requirements, and functionalities. Prospective clients or entities are represented by account details. The database is built with the MySQL application. The popular software for establishing client-server databases can be easily installed on different operating systems. The performance of the mobile system heavily depends on the relational database structure. The complexity of relational data models, data relationships, and record access in the database should be reduced as much as possible for optimal performance.
Significant complexity and higher requirements need to be fulfilled in the database design if the mobile system is designed for a large hotel chain with many rooms and high booking frequency. On the level of hotel chains, the compilation of statistics across several database users may also be needed. The database is a collection of tables that store details about hotel booking, and hotel and unit types are used as queries to retrieve desired detail data about a certain entity when the information must be displayed.
Integration with Property Management Systems
The integration with property management systems is not only desired for mobile hotel booking and reservation systems, but also essential so that changes made via the mobile interface can be viewed on the desktop interface and vice versa. One of the basic features is a connection to property management systems. This allows a mobile hotel booking and reservation system to communicate with property management systems used by the hotel. Such communication allows rooms offered via the mobile hotel booking and reservation system to also be removed from the property management system. In addition, occupied rooms cannot be reserved via the mobile hotel booking and reservation system. Conversely, bookings made via the mobile hotel booking and reservation system would also have to be entered in the property management system. At the time of the booking, the payment transaction would also have to be made in accordance with the payment practices of the property management system. When set, such communication would allow mobile hotel booking and reservation systems and properties that use such systems to cooperate with each other automatically. Such cooperation would not only make systems easier to use but also lessen the possibility of human errors and subsequently unhappy clients.
There are several property management systems in use in the hospitality industry, some widely used and known worldwide while some are less known but just as well developed and sophisticated. To delve two of the most known systems, property management system called Opera and property management system called HMS could be elaborated. Opera is developed by a company called Micros. This property management system is one of the most known systems in Croatia used by many properties. HMS is a Croatian property management system developed by a company called Migra. This property management system is less widely known, however, this system also contains similar capabilities and features as Opera. Mind you, not every hotel property uses such systems; certain smaller hotel properties operate without software support and such properties have no need for a mobile hotel booking and reservation system either. Nonetheless, every hotel property using a property management system sees such integration as a beneficial feature.
The integration with property management systems is a complex but very attainable process. In order for a mobile hotel booking and reservation system to connect to a property management system, there is a need for coders from the company developing the mobile hotel booking and reservation system to cooperate with engineers of the property management systems company. The first step is for the company developing the mobile hotel booking and reservation system to name exactly which property management systems are to be included in this project. Once the property management systems have been chosen, the mobile hotel booking and reservation system developers send questions about the possibilities of integrating property management systems. Such questions could relate to the basic functions such as which data can the mobile hotel booking and reservation system receive and this data can be implemented in such a way that it comes back to the property management system. When such questions are answered, separately for each property management system an integration concept is defined.
Mobile Concierge Services
Mobile technology has enabled the hospitality industry to harness powerful tools to better accommodate guests’ preferences. Leading hotels and restaurants worldwide are implementing mobile technology to better understand guest needs and provide an unforgettable experience. Service providers, on the other hand, make use of mobile technologies to increase productivity, gather insights, and improve service delivery. The arrival of new smart communication and processing technologies has enabled a new set of mobile services.
Mobile concierge services are becoming increasingly popular in the hospitality industry, as hotels and resorts offer mobile phone applications for guests that allow them to request services, complaints, in-room dining, items from housekeeping, and more. Many mobile apps are designed for smartphones only, ignoring the importance of tablet devices. Surveys showed that, in the United States, 15% of hotel guests had used a mobile concierge service; however, 32% showed interest in doing so. There is a clear demand among guests for mobile concierge services; however, the results from hotels as regards return on investment have been less encouraging.
Mobile devices allow hoteliers to intensify engagement with consumers, as they allow instantaneous access to previously unavailable insights about preferences, habits, and trends. Mobile phones can be used to peer into the psyche of potential consumers by constantly measuring the contextual factors that influence people’s mood and drive their behaviors. Hoteliers have the potential to directly engage and cultivate guests’ preferences via mobile technology and use this information to develop an experiential offering that fulfills these requests. As guests have a strong interest in mass-customized preferences, this type of marketing tool could enable local service providers to differentiate their service offering.
Personalized Guest Experiences
Mobile technology has pressed the hospitality industry to evolve to remain competitive. Guests now expect the same flexibility and convenience that they enjoy in their everyday lives, and hotels have turned to mobile technology to enhance guest experiences. In particular, mobile concierge services have revolutionized the hospitality industry by providing guests with a variety of options right from their smartphones.
Several hotels are now giving guests the option of taking full control of their guest experience through a mobile application, with which they can access hotel services remotely. Guests can request room service, ask which channels they have on their television, browse the hotel’s food and beverage options, and check restaurant availability – all before arriving at the hotel. This also allows guests to resolve issues before they escalate, such as checking if a particular dish is available at the restaurant when making a reservation, instead of realizing at the time of service that they cannot order what they want, which can lead to negative perceptions of the hotel service.
But mobile concierge services do not just represent a change in guest expectations. It also demands that hotels start being aware of data privacy and security as they now hold a bigger hosting responsibility regarding guests’ sensitive information. Mobile concierge services usually require guests to provide the hotel staff with information such as their arrival time, special requests, or credit card details to process transactions. As guests become more cautious about where they provide their data and the hotel places itself in the position of a large host, this kind of technology can become a barrier for guests to embrace services provided by the hotel rather than outside companies.
Overall, mobile concierge services have altered the way hotels work and their relationship with guests. The trend of providing a direct insight into guest preferences and adapting services again demands full control on the hotel side, giving back to hotels and OTAs the task of investigating trends and understanding, interpreting, and anticipating the individual guest’s needs and expectations.
Virtual Check-in and Check-out
Virtual check-in and check-out are processes developed in response to the growing demand for getting things done faster and easier, reducing waiting time. Checking in, or registering, is the first step of entering a property when requesting overnight accommodation. This “registering process” usually takes time, especially for larger properties, and a long queue may form, typically in a drawback to enjoying a carefree holiday. To eliminate it, “online check-in” was developed. It’s a service that allows guests to avoid waiting in line or waiting at all for arriving guests. Guests can register ahead of time (usually 1 day prior to arrival) using mobile technology, by themselves, and thus enjoy a carefree arrival at the property. The system recognizes them right away and directs them to their room or another destination. If they prefer not using technology, they could use a dedicated queue where trained staff would assist them. Another option is “remote check-in,” where guests can register already on the train or plane, and afterward, a staff would meet them and guide them to their room.
The same processes are used for check-out, or leaving the property. “Online check-out” allows guests to check out ahead of time in the same way as described for check-in and eliminate the usual check-out queues. With “remote check-out,” guests can check out already before arriving into the lobby. A member of a staff will call them to ensure there are no extra charges and that everything is okay, and ask for feedback. Then, all their bills would be sent to their mobile device or an email address, and their card would be charged. Otherwise, there would be a dedicated queue for outgoing guests. Virtual check-out may also be used. In that case, guests would stay in their room after check-out time, and staff would later enter the room solely for a cleaning procedure, without entering it previous to guests’ departure. This is important for preserving guests’ privacy.
Mobile Payment Solutions
Mobile payment solutions Mobile payment applications have transformed the way guests pay for accommodations and on-premises services. They have greatly reduced waiting times for guests at the front desk, eliminated the need for cash payments for dining, drinks, or spa treatments during hotel stays, and simplified the check-out process at the end of the stay. As a result, mobile payment solutions have become an integral part of the hospitality industry’s digitization.
Contactless payment options Contactless payment options are often integrated with mobile applications; however, they can also be implemented as standalone solutions. Guests using mobile applications can utilize the mobile wallet feature and pay for various goods and services with a smartphone/smartwatch at point-of-sale terminals, just as they would with a plastic card. Furthermore, thanks to the evolution of near-field communication (NFC)-enabled terminals, guests can tap their plastic cards to complete the payment, instead of physical contact with the terminal, which is important during a pandemic.
Mobile payment solutions can be leveraged to enable payments via self-service kiosks located in the lobby and at other guest-dense areas (e.g., gambling areas in hotel casinos). Such kiosks make it possible to reduce the number of employees required for payment processing, as a single attendant would be sufficient to monitor several kiosks simultaneously. On the other hand, such a kiosk-and-mobile scenario could also be fully automated, as guests would not need to interact with hotel employees at the check-out point. This would also allow for off-hour payments, which are especially popular in hotels with 24-hour operations. Use of a mobile device connected to one’s account would permit fast check-out or check-in automated payment processing without the need for human interaction. If the kiosk is equipped with facial recognition technology, such payments could be completed with a touch of a button.
Security and Compliance Considerations Increasing concern about data breaches, fraud, and privacy issues has made it essential for businesses to assess the overall security of their mobile payment solutions. Admittedly, the hospitality industry lags behind banking and government in implementing security protocols. Nevertheless, in a hospitality context, mobile payment solutions must adhere to Payment Card Industry Data Security Standards (PCI DSS), the standards governing all by-way credit card transactions. The hospitality industry is subject to these standards, sometimes called the PCI DSS compliance program, which spans more than two hundred security protocols. Participating firms are required to conduct an annual self-assessment and vulnerability scan, details of which must be reported to acquirers or acquiring banks. Compliance with the PCI DSS standards is not an option, as it is the legal obligation of all entities involved in credit card transactions, and non-compliance can result in significant fines.
In addition to PCI DSS compliance, payment solutions in the hospitality sector must adhere to industry and national directives regarding anti-money laundering policies. National regulations must be taken into full consideration, as they may require additional audit reports, such as those regarding the payments or IT infrastructure. Many above-mentioned topics fall under the umbrella of data security, internal controls in the IT sphere, and technological approach, making it essential to analyze and evaluate these topics thoroughly during the solution’s proposal stage.
Contactless Payment Options
The widespread proliferation of mobile devices, particularly smartphones, has transformed the way businesses operate. It has also changed the way customers interact with businesses, thereby impacting their behavior, needs, and demands. Cash and credit have always been the two main forms of payment for the purchase of goods and services by customers. However, as technology evolves and mobile devices become a necessity, a new and more advanced form of payment has emerged, known as mobile payment options.
Mobile payment options are advanced methods that utilize mobile devices to transfer money to the payee. There are many forms of mobile payment options, such as in-app payments, digital wallets, and near-field communication (NFC). Out of these payment methods, contactless card payments and digital wallets (Apple Pay, Samsung Pay, Google Pay, etc.) are the most widely accepted and used payment methods. A contactless payment, which is also known as tap and go payments, is a form of smart payment that employs RFID chips embedded in contactless cards or secure element in mobile devices to create secure transactions. These contactless cards and mobile payment devices only require tap-to-pay to process the transaction.
The popularity of contactless payment options has gone through the roof in recent years, especially after the onset of COVID-19 in early 2020. It is worth noting that the mobile payment process is not the same as contactless payment options, as the former involves the use of mobile interfaces, and the latter employs NFC-enabled devices. With the pandemic forcing everyone to take additional preventive measures, one of the biggest changes that COVID-19 brought about was the concept of contactless payment options. COVID-19 prompted many businesses to adopt this payment option, irrespective of whether they were related to hospitality or not. As the world opens back up, the demand for contactless payment options has not only remained the same but has now become a necessity for many customers.
According to research conducted by Atos and IDC, the majority (70%) of customers prefer contactless payment options over cash payments. A significant portion of the remaining customers rely on other smart payment methods or wearables to process their transactions. The pandemic acted as a catalyst that forced many businesses to adopt such smart payment options and embrace the technological wave if they wanted to thrive in the hospitality industry.
Contactless payment options are gaining momentum in every industry, but payment industry experts have predicted that the hospitality industry will be the fastest to adopt contactless payment options as compared to others. According to a study conducted by Mastercard in November 2020, it was found that over 32% of people are using contactless payments for the first time ever in their lives in the hospitality industry. 74% of people were sure that they would continue to use contactless payment options as the pandemic subsides.
Security and Compliance Considerations
As mobile technology continues to gain traction in the hospitality industry, hoteliers and hospitality managers are faced with several concerns: how to best utilize it for the hotel and the guest; the fear of jeopardized customer safety; and how to ensure compliance with updated systems. With mobile check-in/check-out and mobile keys poised to become the new industry standard, it is essential that hoteliers understand how to leverage technology to operate hotels more effectively and better serve customers before its implementation.
The introduction of mobile check-in/check-out and mobile keys raises fundamental questions for hoteliers. While mobile check-in/check-out offers a seamless arrival and departure experience, it shifts the responsibility of check-in from the front desk to guests. Hotel staff must be trained to offer assistance with mobile issues as they arise, and all hardware and systems that interact with the in-house guest must function properly. This includes the PMS, loyalty program management, point-of-sale software, and the property’s Wi-Fi network. Hoteliers must understand how to liaise with third-party vendors whose products are necessary for mobile implementation.
Mobile technology allows guests to access information about a destination before their stay, and some hotels are promoting mobile check-in/check-out as a way for guests to gain information about the hotel before arrival. However, if guests are not members of the hotel chain’s loyalty program, sufficient check-in details may not be automatically sent. This is also a concern for international guests who may not understand communication in their second language. Furthermore, there is a risk that guests will forego personal interaction with service staff and become frustrated if technology fails.
There is concern regarding the safety of mobile hardware, be it personal or hotel-provided. Although similar to credit cards, key cards have become a cheaper alternative to high-security keys, and hotels must weigh the benefits against the risk of a breach. More importantly, hotels must protect the data of guests. Any vendor that offers mobile software will ask for access to the property’s PMS, which contains sensitive data about employees, guests, potential guests, and the hotel. Failure to comply could jeopardize the security of the property’s entire computer network.
Future Trends in Mobile Technology and Hospitality
The hospitality industry is well-known for embracing technology and adapting to market trends. With user-friendly technology on mobile devices available at economical prices, digital development in hospitality is moving towards mobile devices. It has been anticipated that mobile technologies will be used in the future to entertain children during flights, recommend destinations, help find accommodation, and offer hotel-directed assistance. Mobile technologies will further enhance the opportunity for personalisation for hospitality industry players. Enhanced personalisation is anticipated to be accompanied by deeper profiling of customers through new technologies, innovative uses of current technologies, and the effective abandonment of old technologies.
From a hospitality industry perspective, the intense profiling of customers presents a new avenue for privacy concerns. If consumers want personalised services from industry players, they must disclose information on their habits and preferences, which they may be reluctant to do. Therefore, a balance must be reached between enhanced personalisation and privacy concerns. Furthermore, it is anticipated that educative tools will be used to help consumers understand the services offered by mobile-based technology. Concerns relating to individuals’ ability to consume products and services offered by mobile devices have become worrying in other areas of concern. For instance, with the consideration of child safety, marketing strategies used by the gambling industry and the resulting outcomes have been studied. Therefore, educative tools are anticipated to help consumers be aware of impending product offers and shipments and mitigate gambling-like situations.
It is anticipated that distinctive mobile service offerings will become a competitive factor, a weapon, and a marketing tool used by mastering technology players; hence, increasing the technological gap. If a player lacks the technological know-how, the attractiveness and competitiveness of the service offering will diminish, making it increasingly challenging to catch up with more advanced players. Service-related differences in mobile technology advancement are also expected to be a competitive and strategic situation. It is even anticipated that there will be player-firm-specific situations where technology-based service offerings are completely lacking and consumer groups left unconsidered.