303 | Hotel Tech Goes Viral: COVID pandemic forces industry to modernize operations

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USE YOUR VOICE: Zenique Hotels’ Aloft in Dublin, California, has Amazon Echoes in rooms through which guests can interact with the property and the staff using only their voice. Though Zenique Hotels had installed the technology in its properties years ago, the coronavirus pandemic is forcing the entire lodging industry to implement tech solutions that keep guests and staff safe and reduces operating costs.

Hotel industry may lag behind in Fourth Industrial Revolution if too slow to adopt new technology, say experts

McKinsey & Co.’s latest study on how the coronavirus pandemic has changed our lives says society will refer to this historic period much like it does before and after a major war or disruption. We will categorize our ways of life as pre-pandemic and post-pandemic.

Many of the changes will involve embracing and harnessing the power of technology.

Much will change in the years ahead, including the way in which we will consume travel and how the hospitality industry will respond to changes in guest expectations.

Hotel owners and operators are finding out that part of our “next normal” includes investing in technology that will enable their businesses to thrive post-pandemic.

Adopting and adapting hotel operations to technology is critical.

The Global Economic Forum recently reported that businesses, especially small ones, that do not take part in the Fourth Industrial Revolution will not survive in a post-pandemic world.

To glimpse what the future holds for a tech-focused lodging industry, consider The Sinclair Hotel in downtown Fort Worth, Texas.

In January 2020, the property celebrated its opening with a nighttime light show that created firework-like displays using 500 drones. The entertainment technology sent a clear message that the Sinclair Hotel operations are wholly unconventional.

The landmark building, built in 1929, has been converted to the world’s first all-digital hotel.

The innovation underscores the current state of hotel technology and what’s just around the corner as hotel developers, owners and managers seek more efficient ways to operate a property as they prepare to do business in a post-pandemic world.

What the Tesla is to the automobile industry, The Sinclair Hotel is to the lodging sector, says Farukh Aslam, president and CEO of Sinclair Holdings.

Sinclair Holdings is majority owner of the hotel, a landmark building for many reasons, including its 1920s Art Deco design and its history as the headquarters of Sinclair Oil Co.

The hotel temporarily closed in March 2020 because of the coronavirus pandemic and is plans to reopen in February. The property is a member of Marriott International’s Autograph Collection. NewcrestImage of Dallas is an investor and manager of the property, which is attracting worldwide attention because of its use of technology to power and operate the hotel and to provide an all-digital guest experience.

A FIRST FOR HOTELS: In this video, Intel shows the unique technology and capabilities of the all-digital Sinclair Hotel, part of Marriott International’s Autograph Collection, in downtown Fort Worth, Texas.

In developing the world’s first all-digital hotel, Sinclair Holdings teamed up with Intel and its internet of things or IoT functionality that equips guest rooms with sensors that operate the lights, TV, HVAC systems and even the bathroom faucets and showers.

The Sinclair Hotel works with Cisco to deploy Power over Ethernet or PoE to keep the lights on and other systems running. It uses data collected at utility end points to manage back-office operations as well as the unique guest experience. Rooms have no manual light switches, and the guest bath is digital, even the shower.

An Ethernet is an internal system for connecting computers and other technology to form a local area network, which collects and shares information within the private network.

The electrical systems at the Sinclair Hotel operate on low-voltage DC power. PoE eliminates the traditional AC power with which most of our homes, hotels and other buildings operate.

“It’s a game changer,” Aslam said.

The inner workings of major household appliances such as refrigerators are structured to run on DC power. But most homes and buildings use AC power. So inverters are used to complete the power connections. Energy is sacrificed in the conversion process, an average of 15 percent of an appliance’s energy is lost.

Aslam explains why that’s significant for The Sinclair Hotel.

“When you have an energy loss, it comes out as heat. If you go close to a bulb, that’s lit up, it feels warm or hot. You won’t be able to touch a bulb that’s been on for 20 minutes, 30 minutes. At Sinclair, we have over 7,000 light fixtures and they’re room temperature. You can stick your finger inside the socket and nothing will happen to you because it’s running on 24-volt DC.”

Most office phones use PoE technology. The system carries both voice and data. Therefore, The Sinclair Hotel can collect a lot of data on how its energy and systems are used in operations. It puts a new twist on the adage “Knowledge is power.”

303 Website

LISTEN: THE GREAT TECH SHIFT: A guest at The Sinclair Hotel in Fort Worth, Texas, uses a touch pad to set the shower temperature. The property which first opened in January 2020 is the world’s first all-digital hotel. Its capabilities are harbingers for what’s ahead in the lodging industry as the coronavirus pandemic forces hotels to modernize operations. Episode 303 of Lodging Leaders podcast explores the pace of hotels’ tech adoption during the coronavirus crisis. (Photo: Sinclair Holdings)

It Started with Lighting

Aslam was first introduced to PoE technology in 2015 when building a hotel that had electrical power organized in zones. Each area such as the fitness center, a meeting room, the lobby, had dimming panels that reduced the amount of electricity generated to light the area. But the technology was faulty and did not achieve the energy-saving results that city building codes required.

“That led me to look more deeply into what is an LED light, how it is powered,” said Aslam who has a college degree in electrical engineering. In 2016, his search led him to Cisco in San Jose, California, which was experimenting with low-voltage LED lighting. He then attended a conference in Las Vegas to meet with Cisco and other LED experts.

“It turned out that was only the first thing we started doing – lighting. So lighting was the easy part,” he said. “Then it became obvious that we can do much more than just the lights.”

All equipment in the hotel runs on low-voltage Ethernet cables – the TVs, air conditioning and guest-facing technology.

Each fixture or appliance is an end point and because it’s connected to the Ethernet cable they can collect data about how they’re used. The information is used to increase cost-efficiency.

Working with Intel’s artificial intelligence technology, operators know when a guest room is occupied. The rooms are equipped with Bluetooth technology that tells how long the lights, TV and the HVAC system have been on and at what temperature. Combined, this allows operations to turn off the lights and lower the temperature setting when the room is unoccupied. When the guest returns, hotel management is notified via the guest’s cell phone ping and the room’s electrical systems are returned to where they were before the guest left.

“Anything that’s connected to the Ethernet cable now is getting power and data. And it has an IP address. That is amazing because now I can talk to every single device from anywhere in the world,” Aslam said. “The basis of artificial intelligence is data. Intelligence is as good as the data you have to tell something to do.”

Years of Innovation

Aslam is the first to tell you that although everyday hoteliers are just starting to adapt their buildings’ functions to technology, a lot of the foundation for technology, such as power over Ethernet, has been around for decades.

In Burlingame, California, Rupesh Patel, CEO of Zenique Hotels, credits his father, Raman Patel, with the design strategies that give their properties the competitive edge when it comes to a tech-based guest experience.

The family bought and sold a few properties over the years. In 2011 it acquired a La Quinta Inn and Suites in the San Jose airport market. They extensively renovated the property and moved it from 43rd to first place on TripAdvisor. The company then built an Aloft Hotel in Dublin, California. Now it is developing a Hyatt Place in Paso Robles.

The Aloft Hotel has digital check-in and mobile key. Its guest-room lights and thermostats are voice controlled via an Amazon tablet with the Echo app. It has a robot that delivers items to rooms.

The sky’s the limit, says Rupesh Patel, who advises a few tech startups. “We’re always interested in new technologies and given we’re in the Silicon Valley, it’s around us a lot.”

Patel recalls his father serving on franchisee committees that explored the use of technology to improve cost savings as well as the guest experience. Now that the younger Patel helms the family business, he’s seeing these things becoming commonplace – especially during the coronavirus pandemic.

“One of the big ones is mobile check-in,” he said. The technology “was kind of always there” but guests were slow to adapt to it. Many brands require loyalty membership to use the app, but a low number of members followed through on downloading and application. Meantime, many travelers who are brand agnostic want the capability. Patel expects to see third-party providers stepping in to offer the option to branded properties.

Electrostatic spraying has become a standard practice during the pandemic and Patel expects it to stay. Before the pandemic, he said, “hotels would not even think about investing $1,000 even up to $3,000 for the equipment. But it became a necessity.

ROBOT TO THE RESCUE: United Airlines uses the NovaRover, a robot, to spray its airliner cabins overnight with an EPA-approved antimicrobial solution called Zoono Microbe Shield that kills viruses, including the coronavirus. Hotel industry leaders expect such robotic technology to become the norm in lodging as owners and operators seek ways to satisfy guest expectations and reduce operating costs.

As a rule, the hotel industry has been slow to deploy new technology. But in the COVID-19 age, communicating with guests via texting and other contactless methods of providing customer service are “forcing hoteliers to look at it a little bit earlier and added into their CapEx budgets,” Patel said.

Though many of the solutions are new, modern guest expectations and the need for hotel businesses to maximize every dollar has driven owners and operators to take a new look at existing solutions.

Because of the concerns about contracting COVID-19 on contaminated surfaces, Zenique Hotels is substituting in-room tablets with QR codes, which were invented in 1994.

“I and several of my friends thought the QR code was such an obsolete technology. You saw it, but very rarely. And now you see it on every single table at every single restaurant and bar, and now you’re seeing it more at hotels. It definitely is interesting that it’s made a strong comeback. It took a pandemic for it to happen.”

Aavgo, provider of Zenique Hotels’ in-room tablets with touch screens, is shifting to QR Codes.

Patel won’t name the brand, but says it plans to implement QR Codes throughout their hotels so guests can use them to order food from the restaurant or a drink from the bar. “They can do it straight from their phone without having to download the brand’s app,” Patel said.

“The idea of everyone using their own mobile device is becoming really big because people trust their own device. They trust the cleanliness of their devices, and they’d rather use that than a new product or new hardware in hotels.

Another advancement is the advancement of robotics in cleaning a guest room, especially one in which a COVID-positive guest inhabited.

‘There are new technologies coming out and will become less expensive than they are today, such as robots that go into the rooms and either use UV light to disinfect the room or the electrostatic spraying,” Patel said.

The use of robots to disinfect a room will lower labor costs, a critical component to managing a post-pandemic comeback for businesses. The crisis has led to creation of new departments to deal with new realities, Patel said. It has “added the need for more people to do more things while our revenues have drastically declined.”

VIRTUAL CONCIERGE: Rajiv Trivedi of Tri Star Trivedi and TST Capital has invested $2 million in Virdee, a software program that allows hotels to offer guests a digital concierge that takes care of check-in and other on-property services. Contactless interaction between hotel guests and staff is a preferred method during the coronavirus pandemic, but Trivedi and others immersed in hotel tech say it’s here to stay post-pandemic.

Digitally Self-Sufficient

Rajiv Trivedi, former president of La Quinta by Wyndham and now founder of Tri Star Trivedi and its subsidiary TST Capital, made news in the fall when he became part of a group of investors that provided $2 million in seed capital to Virdee, a digital-concierge software program.

Product developers are Branigan Mulcahy and Nadav Cornberg, who are also founders of The Guild, a home-sharing platform in Austin, Texas.

Trivedi said his interest about Virdee’s technology was piqued last summer.

“During my days at La Quinta, we had invested a lot of time and effort in finding such a technology that can comprehensively address all needs of the guest. It was very difficult to identify a technology that is seamless; that is convenient for the guest; that will have added value; that can have savings proposition for the owners and operators; and that provides a greater level of security and cost savings in many of the areas, but more importantly, a system that can take care of soup to nuts, everything beginning to the end.”

While Virdee can manage guest check-in, Trivedi said there is value in keeping the front desk operations. “In my opinion, human interaction is enormously important. However, there are times when a hotel is very busy, they need a support and help.” Using technology like Virdee, “can help enhance guest experience as well and expedite the process of check-in.”

Virdee also creates an opportunity for the hotel to virtually upsell higher-priced rooms or added amenities.

Another big draw for Trivedi is the platform’s ability to do background checks or security clearances on guests, including a photo. It’s not super invasive but it goes a long way to deter sex traffickers. It also protects against credit card fraud.

The pre-pandemic front desk is obsolete. During check-in or check-out, front desk agents barely interact with guests, Trivedi said, “because they are focused on the computer. If you pull those people out and have them talk to the guest and have a pleasant conversation and assist them through the process of check-in through this virtual concierge, it will become a personalized interaction.”

Software solutions like those developed by Virdee are poised for widespread adoption in the COVID-19 age.

“If you look at the other industries, it already exists,” Trivedi said. “Airlines have put us into daily practice of going to a kiosk and checking in and getting your boarding pass or checking into your luggage. We seldom go to the desk anymore unless you have a question and there are people there. It is happening at a grocery store. It is happening at a hardware store. It is happening in fast-food facilities where you’re ordering your own food and simply paying. You’re self-sufficient with transactions done very efficiently.”

Many hotel owners are hesitant to implement new technologies because they see it as a cost with little return. But as the pandemic has stripped hotels of revenue, Trivedi expects owners to view technology in a new light and adopt it because it will save them money in operation and labor costs.

It is also what the younger generation of travelers expect, said Trivedi, the father of three teenage boys.

The emerging generation of travelers are reliant on technology, Trivedi said. “They are self-sufficient. They are not used to interaction. Their life is more or less is through social media. It’s different, but that is what it is. The hotel companies that adopt technology that is convenient for this generation will have a much greater chance of becoming successful. It could become a competitive advantage.”

New Tech Integration

In agreement with Trivedi is Adam Harris, CEO of Cloudbeds, a hospitality suite of products, including property management, a booking engine, channel management and a payment system.

Harris believes it’s the lack of technology integration that causes hotels to lag behind modern-day competitors.

“The industry is actually slower to adopt because you’re so much reliant on so many different platforms to work together in concert. Unfortunately, it just doesn’t work that way,” he said. “What we realized was if we built from the ground up this sort of new age PMS, and we wrapped around technology that meets day-to-day requirements, we can

Cloudbeds built what Harris calls a “new-age PMS” and the wrapped around other technology that takes care of other day-to-day business requirements. This frees up staff to directly interact with guests, either face to face or virtually via a handheld device.

Harris said he’s seeing more hotels than ever taking stock of the technology they have on hand and what new solutions need to be implemented in the midst of the coronavirus pandemic.

“Big and small operators all want new technology. I think if any theme that’s out there that is absolutely the commonality is, ‘How do we look at our workflow today?’

“Because of COVID, it’s actually the perfect time to invest time in reviewing your process or overhauling your technology,” he said. With lower occupancies, “hotels have an opportunity to sort of rethink workflows and see what can be automated.”

A major component of hotel operations is the property management system, including integrated programs that perform critical functions, Harris said.

“If you are offline, meaning you’re not in the cloud, you’re not alone,” he said. “Nine out of 10 properties are still offline.”

Many properties are “stuck” with legacy systems, which slows their adoption of new tech.

Often, a hotel adds new technology by integrating it with existing programs. Getting nascent solutions to co-exist and co-operate with legacy systems can create new problems and is not always efficient.

“We need to solve that as an industry,” Harris said. “And the sooner we do that, we will unlock an incredible opportunity to provide amazing experiences to all those people who are just gearing up to travel for the first time in over a year.”

LEGACY MESS: Cloudbeds uses these illustrations to show how convoluted most hotel operating systems are (above) and how its solution is to integrate property management and other functions into a cohesive program (below). Only one in 10 hotel PMS operate in the cloud, says Adam Harris, CEO of Cloudbeds.

Many of the customers that will book post-pandemic depend on their mobile devices for all kinds of everyday uses. Hotels should be part of that equation.

“For the first time in 2020, the largest population of future travelers was born after 1979,” Harris said, adding they grew up with things on demand. Think Netflix, Uber Eats, Spotify.

The on-demand mindset is here to stay. But such self-sufficient consumer behavior is not evident in the travel industry. Harris said he’s blown away by the fact that only 25 percent of airline customers use mobile boarding passes. With hotel brand loyalty programs, just 13 percent of the members use digital key. And the low-adoption rate is not the fault of the traveler.

“There’s no consistency across the industry that everyone has digital locks or everyone requires you to check in at the front desk,” he said. Consumers get frustrated with having to download and access too many apps.

To prepare to do business in a post-pandemic world, the hotel industry has to address two issues, Harris said. “One, we have to get ready for that new generation of traveler, and, two, we have to get off legacy tech.”

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