untitledDRIVE- THRU
Produced by
TAKES OFF
H O S P I TA L I T Y I N D U S T RY S E L F - S E R V I C E T E C H N O L O G Y S T U D Y
A S U P P L E M E N T T O H O S P I T A L I T Y T E C H N O L O G Y
3
INSIDE PERSPECTIVE: Preparing the Way for a Self-Service Explosion . . . . . . . . .4
EXECUTIVE SUMMARY: Kiosk Check-In . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6
CHAPTER ONE: Consumer Attitudes Towards Self-Service . . . . . . . . . . .7
COMMENTARY: Self-Service Checks in . . . . . . . . . . . . . . . . . . . . . . . . .10
CHAPTER TWO: Lodging Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12
CHAPTER THREE: Restaurant Industry . . . . . . . . . . . . . . . . . . . . . . . . . . .16
CASE STUDY: The Business Traveler’s Best Friend . . . . . . . . . . . . . . .18
Group Publisher . . . . . . . . . . . . . . . . . . .Andrew Gaffney Associate Publisher . . . . . . . . . . . . . . . .Lenore O’Meara CEO . . . . . . . . . . . . . . . . . . . . . . . . .Gabriele A. Edgell President . . . . . . . . . . . . . . . . . . . . . .Gerald C. Ryerson
Editor . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Reid A. Paul Associate Editor . . . . . . . . . . . . . . . . . . .Kevin O’Rourke Author . . . . . . . . . . . . . . . . . . . . . . . . . . .Mary L. Carlin Creative Director . . . . . . . . . . . . . . . . . .Colette Magliaro Graphic Designer . . . . . . . . . . . . . . . . . . . . .Crystal Iglar Production Director . . . . . . . . . . . . . . . . . .Patricia Wisser Production Manager . . . . . . . . . . . . . .Kimberley Hartman Circulation Director . . . . . . . . . . . . . . . . . . .Jeffrey Zabe Marketing Director . . . . . . . . . . . . . . . . . . .Dan Ligorner
© 2005 by Edgell Communications
4 Middlebury Blvd. Randolph, NJ 07869 Tel: 973.252.0100 Fax: 973.252.9020
Founded by Douglas C. Edgell 1951-1998
WHY IS SELF-SERVICE IMPORTANT? Service is a key differentiator for the hospitality market. Self-service provides an option for consumers to interface with your brand, and another avenue to increase your service. Repetitive tasks like hotel check-in and food service pre-order can oftentimes be done quicker and more easily through an automated device.
WHY DOES SELF-SERVICE SEEM TO BE GAINING MOMENTUM RIGHT NOW? Changes in consumer attitudes and in the technology itself have brought about a general acceptance of self-service both in terms of usability and a willingness to use kiosks. Consumers have less and less time for routine and repetitive tasks, many of which can easily be automated. Consumers are also looking for a predictable experience, even though sales associates can vary in knowledge and experience. Self-service works best in a space without much value add for the human touch. I see this area exploding in the next 12-18 months, especially as the economy continues to improve.
WHAT ARE THE KEYS TO A SUCCESSFUL SELF-SERVICE IMPLEMENTATION IN HOTELS AND/OR RESTAURANTS? The first key is determining the need for a kiosk. What is the benefit to the consumer? An ATM is probably the most successful example of a self-service device because it has very clear benefits for the consumer. Usage will grow from usability—ease of use—which must be clear and very natural. Location is also key: The design must reflect the environment for placement. Reliability is very important for a self- service device. To build consumer confidence, guests need to be able to depend on it working. Integration with back-office core systems is also significant. Self-ordering should integrate with the POS and other systems to gather pricing and inventory; while check-in kiosks need to integrate with the PMS.
WHAT ARE THE IMPORTANT FACTORS DRIVING SELF-SERVICE IN HOSPITALITY— EFFICIENCY, REDUCING LABOR COSTS, UPSELLING, IMPROVED SERVICE? Certainly all of those play a role, but improved service is first and foremost. Improved food service means speed of service and order accuracy, and a kiosk can really improve both, because there is no communication with a person—the order goes straight to the kitchen. For hotels, providing a kiosk improves service through speed. With the kiosk users’ displacement out of the queue everybody gets served faster, including those at the counter or front desk.
Upselling on a kiosk for QSR means the average ticket size increases over the counter, both in terms of size and additional items. Counter people are less consistent at upselling than a kiosk. With hotels, the opportunity is there also, say for upgrading to a room with a view at extra cost.
Preparing the Way for a
SELF-SERVICE
4
To get the inside track on the latest self-service innovations
and trends in foodservice and lodging, Hospitality
Technology interviewed Tracy Flynn, vice president of
hospitality sales for NCR’s Retail Solutions Division.
5
EXPLOSION WHAT IMPORTANT CHALLENGES DOES SELF-SERVICE ADDRESS FOR HOTELS AND RESTAURANTS? For hotel and restaurant operators, the ultimate goal is the same: efficiently providing guests with a high level of service. How that service is provided be it through a quick and easy self-service experience or through interaction with someone at the front desk, is less important than the guest’s satisfaction and the delivery of the desired service. Self-service can help hotels and restaurants deliver that service efficiently, accurately and with high customer satisfaction.
Service should not be defined by the amount of time guests spend waiting in line. Both hotels and quick-service restaurants face distinct periods of heavy activity. Those periods—whether it is a lunch rush or a noon check-out—can be more efficiently handled by offering guests a self-service alternative.
Self-service can also help hotel and restaurant operators handle other challenges, like upselling and redirecting personnel to interact more with guests. In QSR settings, kiosks have been shown to be more successful at upselling guests as well as encouraging the use of credit cards. And, in both hotel and restaurant settings, after implementing self-service many operators have found great success by moving employees out from behind the front desk either to interact more directly with guests or to help handle orders more quickly and accurately.
WHAT DO YOU SEE HAPPENING IN HOTEL SELF-SERVICE IN FIVE YEARS’ TIME? Self-service will address and accommodate more and more guest requests and additional applications, like airline check-in at the hotels. NCR acquired [airline check-in kiosk vendor] Kinetics last year with a vision to integrate it with our hotel program, i.e. to check-in luggage at the hotel, providing a better guest experience. This is becoming very possible, to send it directly to your home from the hotel. As security increases and airport check-in lines get longer, separating the guest from their luggage will make check-in two different functions.
WHAT DO YOU SEE HAPPENING IN RESTAURANT SELF-SERVICE IN FIVE YEARS’ TIME? Soon, guests will be able to recall orders at every visit, say with a loyalty card for regular orders, or printing out a bar code or receipt to scan in and recall a previous order. Guests will then be able to add modifications. Payment is another big driver, we’ve seen a transition from cash to electronic cash recyclers in the last six months. This means the change from customer #1 can be reused for customer #2, like a cashier drawer. Previously, most kiosk implementations did not handled cash or used dispensers only, which meant too much cash was required for running the device.
WHAT NEW SOLUTIONS DOES NCR OFFER FOR HOTEL AND RESTAURANT SELF-SERVICE? For lodging, we have NCR EasyPoint Xpress Check-In, and we offer Xpress Order and Pay for QSR. We’re working aggressively on airline check-in in off-airport locations.
HOW DOES NCR’S EXPERIENCE IN OTHER INDUSTRIES CONTRIBUTE TO ITS HOSPITALITY SELF-SERVICE OFFERINGS? We are the world’s largest provider of self-service solutions—the leader in ATMs and in the retail self- service market. We really understand reliability and serviceability—especially hardware; usability; locations to maximize usage; and the consumer’s expectations in interfacing to a self-service device.
5
KEY FINDINGS Thanks to the dramatic increase of self-service options in other industries, consumers are ready for self- service hospitality. This interest in self-service may even translate into a willingness to shift brand loyalty based on access to self-service solutions. Even though relatively few consumers have seen or used a self- service option at a quick-service restaurant or hotel—16% for QSRs and 17% for hotels—more than 50% of respondents indicated that they were willing to use a self-service kiosk in either setting. More significantly, 38% of respondents indicated that they were more likely to dine at a QSR with self-service and 41% were more likely to stay at a hotel with self-service.
Lodging operators clearly are preparing for growth in self-service check-in and/or check-out. The trend is being led by larger hotel companies, averaging 758 hotels and an average daily rate (ADR) of $187.60. Even the hotels that have decided against self-service check-in have made the decision after careful consideration: 62% of such respondents indicated that self-service does not fit their industry segment. In total, 59% of respondents indicate that they plan to implement kiosks and of those 45% have already implemented self-service check-in or will do so within one year. Another 44% will implement self- service within two years. The key business driver for implementing check-in kiosks is customer service. Consequently, it should come as no surprise that a majority of hotels will measure the kiosk’s success by looking at customer satisfaction.
In contrast, while consumers seem ready for order and pay kiosks at quick-service restaurants, restaurant operators have not given the technology the same level of consideration. Relatively few operators elected to participate in the survey and those that did by and large responded that they were not considering self-service alternatives. Interestingly, those that did indicated deployment at over 2,200 restaurants within two years’ time.
METHODOLOGY During April 2005, three separate surveys were conducted covering consumer attitudes, restaurant and lodging operators. 1,125 were contacted via telephone in a survey conducted by Opinion Research Corp. In addition, Hospitality Technology conducted its own survey of industry-specific experts. One hundred and twelve lodging operators and sixteen quick-service restaurant operators responded to e- mail invitations to complete the online survey. The surveys were focused exclusively on check-in/check- out kiosks for hotels and order and pay kiosks for quick-service restaurants and did not include any other type of self-service solution for the industry.
Hospitality Technology would like to thank Mary L. Carlin for her insight into this study and her authorship of its findings. As the former editor of Kiosk Business, Carlin brought a wealth of experience and insight to the topic as well as a refreshing analysis of the findings.
Executive Summary
KIOSK CHECK-IN In the first Hospitality Industry Self-Service Technology Study, consumers, lodging operators
and restaurant operators were surveyed about their interest in self-service and the state of current
implementations. The results of all three surveys indicate a growing interest in self-service even
though restaurants are lagging behind both hotel implementations and consumer expectations.
6
7
QUICK SERVICE RESTAURANT ORDER & PAY KIOSKS For the consumer survey, respondents were asked whether they had heard of or seen a self- service kiosk to place orders and pay for food at a quick service restaurant. Of the sample, 16% said yes, and 83% said no (1% said don’t know). This indicates the relative newness of the technology for the majority of participants in the survey. The largest group answering yes was aged 18-24, perhaps reflecting the younger customer base of QSR. When asked to weight the potential benefits of the technology, 56% cited faster service, 55% shorter lines, 52% accuracy, 45% greater control, and 36% no interaction with a cashier (See Figure 1.1).
Participants were also asked how likely they would be to use an order and pay self- service kiosk at a quick-service restaurant. 56% of the sample said they were very likely/ somewhat likely, 40% were not likely, and 4% didn’t know. The willingness to use self-service is very promising especially in light of their overall lack of exposure to these devices.
Consumer Attitudes Towards
SELF-SERVICE From April 22-25, 2005, Opinion Research Corporation conducted a telephone survey of 511
men and 514 women aged 18 or older and living in private households in the continental United
States. The goal of the survey was to investigate consumer knowledge of and interest
in using kiosks for ordering and payment in quick-service restaurants (QSR) and for hotel
self-check in.
Privacy
58%
44%
50%
45%
52%
52%
59%
55%
61%
56%
8
1
The last question in this section asked, “Would you be more likely to dine at a QSR that offered a self-service check-out option?” 38% answered that they were in fact more likely to go to a restaurant offering self-service. This is especially interesting in light of the above answers; here is a new technology that most people haven’t even seen or used yet, but nearly 4 out of 10 are going to make a purchasing decision based on whether or not it is available.
HOTEL SELF-CHECK IN KIOSKS The second section asked about hotel self-service for check-in or check-out. Just 17% of the sample had heard of or seen a self-service kiosk that allows you to check yourself in and/or out of a hotel, 81% had not, and 1% didn’t know. As with the QSR question, this illustrates the relative newness of the application. The age group 33-44 was most likely to use a kiosk (72%). When weighting the potential benefits, 61% cited faster service, 59% shorter lines, 58% privacy, 52% accuracy, 50% greater control, and 38% no interaction with a desk clerk (See Figure 1.2).
As with the QSR weighting of benefits, speed and line busting came out as the strongest advantages of using a kiosk, and over a third of participants preferred not to interact with a person to complete such a simple task. In both cases, the younger the participants, the more they preferred this benefit, perhaps reflecting relative comfort using a new technology unaided. When asked how likely they would be to use a self-service kiosk, 59% were either very likely or somewhat likely to use such a self-service option. While the technology is relatively unknown, its
“Speed and line busting came out as the strongest advantages of using a kiosk, and over a third of participants preferred not to interact with a person to complete such a simple task.”
9
availability is likely to have an impact, given that 81% of the sample had not seen or heard of these kiosks before (See Figure 1.3).
When asked if they were more likely to stay at a hotel that offered a self-service check-out option 41% of respondents indicated that they were more likely to stay at such a property—a very promising response. Again, customer loyalty and purchasing decisions are going to be swayed by the availability of a technology that is only known directly by 17% of the sample thus far (See Figure 1.4).
WOULD YOU BE MORE LIKELY TO PATRONIZE A LOCATION WITH SELF-SERVICE
QSR
Hotel
RESPONSE
0
10
20
30
40
50
60
Figure 1.4
LIKELIHOOD OF USING CHECK-IN/OUT KIOSKS
What a difference a year or two has made in terms of the proliferation and acceptance of self- service devices. According to Jeffrey Rayport and Bernard Jaworski in their newest book Best Face Forward: Why Companies Must Improve Their Service Interfaces with Customers (Harvard Business School Publishing, 2005), the service industry is undergoing a major revolution as self-service kiosks sprout across the business landscape like dandelions on an open field in the spring. Following the lead taken by bank institutions, retailers, airlines and others, hospitality organizations are turning to self-service options in part because of necessity and in part because of opportunity.
Necessity stems from the typical labor woes facing the industry: rising labor costs, difficulties in attracting and retaining quality employees, and service inconsistencies due to employee mood swings. Opportunity knocks as technology capabilities grow, costs decrease, and use becomes more intuitive. Self-service kiosks provide new ways to deliver services, often faster and cheaper than by traditional approaches, with their rich media capabilities and their ability to be placed almost anywhere. Consequently, companies are seeking innovative, yet practical ways to combine people and technology to process transactions quickly and cost-effectively.
With the big chains joining the self-service bandwagon and negating the arguments of naysayers that this technology is not appropriate for hospitality, it is safe to say that self-serve technology has entered the mainstream and is here to stay. Perhaps we as a society should now be labeled as the “self-serve nation,” as we begin to see the concept of industrialized service first proposed by marketing guru Theodore Levitt in a Harvard Business Review article more than 30 years ago finally come to light and come to grips with the commodity-like nature of many basic services like check-in and check-out.
Despite the rapid proliferation of kiosks, the industry is only beginning to tap the full potential of this technology wave. Once considered only appropriate for the budget and economy sectors of the industry, kiosks show great promise in more up-scale segments as well (see Table 1). Today, most major full-service brands have embarked upon kiosk rollouts. According to this study, proliferation of kiosk devices is on the rise across the industry, from casinos to luxury hotels and resorts as well as within the mid-scale segment.
To date, the focus of kiosks has been almost entirely on check-in and check-out functionality; yet some hospitality companies are exploring the possibilities of adding other value-adding capabilities such as language translation for international guests, airline check-in for departing guests, concierge functions for in-house guests, profile maintenance and account management for frequent travelers, and guest satisfaction surveys for all guests.
One of the distinguishing characteristics of the service industry is the participatory role customers play with regards to the creation and delivery of the service. The customer not only plays a pivotal role in specifying the service parameters but also in delivering the service
SELF SERVICE Checks-in to Hospitality
10
by Daniel J. Connolly, Ph.D., Assistant Professor, University of Denver
11
experience. It may seem counterintuitive to think hospitality can be delivered via a kiosk, but that is exactly what this year’s respondents are saying. Over 90 percent of the respondent pool noted customer service—not cost reductions or labor issues—as the driving force behind kiosks. In addition, almost 60% of the respondents indicated that they were likely to use kiosks for check-in when given the option.
Kiosk and self-service technologies are becoming more important in the hospitality industry and are tools hospitality leaders should watch and experiment with—especially given the growing ubiquity of these technologies, a more technologically sophisticated society, and the need to minimize costs. The successes experienced thus far in hospitality and other industries suggest that these technologies offer great potential and are worthy of consideration. The trick is to find the appropriate blend of machines and people to optimize the organization’s service delivery, customer interaction, and customer relationship management.
Although technology is great, it is important to provide service options and let guests select the most appropriate approach based on their needs, situation, and comfort levels. Clearly, the adoption of self-service technologies is changing the high-touch tradition of the hospitality industry and will put more pressure on organizations to pursue customer relationship management (CRM) initiatives to provide personal touches at each point of customer interaction. Kiosk technology will likely cause some changes in staffing requirements, particularly with the skills sought. If customers are doing much of the data entry and transaction processing, service agents can focus more on greeting and conversing with guests. Personal skills rather than technical skills will once again rise to the top of the selection criteria.
Despite these issues, kiosk applications offer a great deal of appeal to service providers and are likely to transform the notion of service as it is presently defined today. The Internet is perhaps the biggest kiosk of all. While the impact of kiosks may not be as profound as that of the Internet, the future could get exciting, so stay tuned!
Dan Connolly is assistant professor at the School of Hotel, Restaurant, and Tourism Management and the Department of
Information Technology and Electronic Commerce University of Denver's Daniels College of Business.
GUEST ADVANTAGES
•Flexibility to select desired service delivery method •Shorter lines •Faster processing times •Added convenience •Increased control over transaction •Communications conducted in native language •Additional services (e.g., airline check in, frequent travel program account management, concierge, etc.)
•Consistent service delivery (i.e., service is not subject to mood swings)
•More privacy (by completing transactions off-site)
HOTEL ADVANTAGES
•Labor reduction •Operational efficiencies •Consistency in service delivery •Ability to expand service reach, capacity, and offerings •Remote check-in options •Opportunities for incremental revenue •Use of multimedia to personalize and up-sell guests •Convert variable costs (labor) to fixed costs (machines)
•Free up staff to handle more complex transactions •Data capture (e.g., guest feedback surveys) Always available (i.e., 24/7)
TABLE 1: KIOSKS CREATE WIN-WIN OPPORTUNITIES
Lodging Industry
SELF-SERVICE In addition to the consumer survey, more than 100 lodging operators responded to a
questionnaire covering attitudes towards self-service check-in and check-out implementations.
The survey reveals that attitudes towards and expectations of self-service have changed
remarkably in the hotel sector in the last few years. Kiosks have evolved from Internet access
or ‘virtual concierge’ services to become a popular guest alternative to the front desk. Kiosks can
now dispense card keys, print maps of the property, and print folios to avoid a wait at the front
desk when you’re sprinting to catch a flight.
Business travelers in particular have been clamoring for hotel self-check-in kiosks, having become accustomed to the convenience of the airlines’ self-check-in options at the airport. Frequent travelers have come to expect speed and convenience from their airlines and their hotels, and customer loyalty is being driven by the availability of such options as hotel self-check in.
Our first self-service study of the lodging industry reflects these new developments. As shown in the chart below, larger properties and hotel chains are the early adopters, as they have the most to gain by shortening the lines at their front desks. Of the hotel operators responding to our survey that had already implemented kiosks, 46% had less than 1,000 rooms, and 43% had between 1,001 and 10,000 rooms. The largest properties accounted for just 11% of the total, but may end up accounting for a greater number of kiosks in place (See Figure 2.1).
10,000 or more
Fewer than 1,000
12
2
13
WILL KIOSKS BE DEPLOYED?
CATCHING THE WAVE A major wave of kiosk deployments has taken place led by industry leaders like Hyatt, Hilton and Marriott. “If you don’t have self-service options, you’re not offering your guests a full-service experience,” Barry Shuler senior vice president IT strategy & chief technology officer at Marriott International recently wrote in Hospitality Technology. “Exceptional hospitality is reinforced through deep, continuous conversations with guests, whether with carefully trained service associates or through robust self-service offerings.”
Similarly, as Tim Harvey, senior vice president and CIO of Hilton Hotel Corporation explains: “We think that self-service will be a standard for all brands, but may not look like a kiosk. For example, with Web check-in at focus service brands we’ll provide a scanner and key dispenser in the lobby to complete the check-in process.” The economics are tougher for smaller hotels. We are also researching co-residing with an ATM.” Co-residing or hybrid kiosks can help reduce footprints in precious lobby space and foster economies of scale for getting a new deployment financed and off the ground.
Size definitely influences the impetus for installing kiosks. The longer the lines, the greater the advantage to be reaped by offering line-busting alternatives, and the larger the chains, the larger the budget for launching such initiatives. Of our sample, the average number of hotels for operators deploying kiosks was 758. In contrast, respondents not implementing kiosks had an average of 165 hotels. The average daily rate (ADR) was $187.60 for hotels implementing kiosks, while those without reported an ADR of $164.60.
The current push forward in hotel self-check-in deployments was reflected in our data for planned kiosk installations. 45% of respondents with kiosk plans in place will reach full deployment within one year; a further 44% will be fully deployed within two years. Just 11% have kiosk plans that are three or more years out.
2
KEY BUSINESS DRIVERS Behind the push to self-service is an interest in improving service. “Business travelers know what they want and go directly to the kiosks,” explains Gary Dollens, vice president of product design and strategy at Hyatt.” If they need a desk clerk they can go directly there, but if not they can go use the kiosk and get on their way. Echoing the sentiment, Hilton’s Harvey adds, “We deploy kiosks for offering customers a choice…use the front desk or use self-service.”
Overall enhancement of the travel experience by increasing speed and efficiency is the shared goal of both the airline and lodging industries. Not surprisingly, many hotels appear to be examining self-service solutions that combine airline check-in (and even luggage check-in) as well hotel self-service.
Customer service is the ultimate goal for hotel kiosk installations, coming in at over 92% with our hotel operator respondents. Improved service drives customer loyalty, as the airlines have found with their kiosk installations. At over 63%, improving operational efficiencies and redeploying resources is the
second major business driver, perhaps reflecting the pressures of a difficult travel economy and the high rate of staff turnover. Competitive differentiation came in at 24%, but this aspect should increase in importance as more and more major chains offer kiosk check in to their guests. The lowest number, 11%, chose to increase revenue and upselling opportunities through their kiosks. Again, as this technology moves forward into ubiquity, the strengths of kiosks as key business drivers in these areas will become more and more apparent. Some chains are already looking into offering upgrades and rooms with a view through their kiosks, and research has shown that customers tend to react more favorably toward upselling onscreen than coming from an employee (See Figure 2.3).
0 20 40 60 80 100
92%
63%
11%
14
2
15
CUSTOMER SATISFACTION Our respondents’ key measures of success for hotel kiosk deployments were also overwhelmingly in favor of customer satisfaction, shown in the chart at 58%, followed by usage rate at 34%. For Hilton properties with kiosks, “Success is measured by usage and customer feedback,” explains Harvey. According to our survey, the average number of kiosks deployed per location is 3.1, and this number will fluctuate (as will kiosk location) according to usage rates. Customer satisfaction is more difficult to measure, and is generally done through feedback to staff or customer surveys (See Figure 2.4).
For those survey respondents without any plans for kiosks, we asked why. The Achilles’ heel of any business plan for deploying kiosks has always been the difficulty of measuring return on investment, or ROI. The inability to measure ROI tied with no IT budget at 19%. A lack of investment money for IT spending is a problem that has historically slowed the lodging industry in making many technological improvements. A more insurmountable problem for kiosk initiatives is reflected by the 62% who feel that kiosks do not fit their hotel segment. This perception will change with time, and with changing customer expectations for boutique and smaller leisure hotels.
Customer Satisfaction Usage Rate
Kiosks do not fit this hotel segment
19%
62%
19%
SELF-SERVICE When restaurant operators were surveyed about self-service implementations, relatively few
operators completed the survey. While the sample size was too small to draw any sweeping
conclusions, the data does lend some interesting insights into the concerns and interest levels
for kiosks in the QSR space. As with hotel check in kiosks, the overwhelming goal of QSR
deployments is to improve customer service. Of our respondents from the restaurant industry,
nearly 88% of those deploying kiosks named that as their key business driver, and
almost 63% are deploying kiosks with the goal of increased revenue and upselling opportunities.
Other
63%
38%
13%
88%
13%
BUSINESS DRIVERS FOR ORDER AND PAY KIOSKS
Upselling has been particularly successful for kiosks in the QSR space, as customers respond much more favorably to a prompt onscreen (“Would you like fries with that?”) than to an employee suggesting it. Employees are also less reliable in remembering to capitalize on upselling opportunities, and high employee turnover in this industry has made this problem more acute. Upselling on kiosks is an area that is quantifiable in terms of ROI for justifying deployments. The other key driver, at nearly 38%, was improving operational efficiencies and redeploying resources—particularly staff, who can focus on customer service and leave repetitive tasks like order and payment acceptance to the kiosks. Answers listed under ‘Other’ included increased average check sizes and speed (See Figure 3.1).
16
3
46%
8%
31%
15%
Figure 3.2
Only two of our respondents plan deployment within a year, but six out of sixteen plan it within two years, to be deployed at over 2200 restaurant locations. This reflects the curve of early adoption that often exists for important growing technologies, with the key players moving ahead first. For best business practices, POS (point of sale) integration ranked as the most important issue, followed by remote management and prominent location. POS integration is critical for the smooth integration of self-service into QSR—particularly for pricing and stock updates to be done automatically and as close to real time as possible. Remote management has taken a giant step forward in keeping kiosks up and running, and has largely erased the public perception of five years ago of kiosks as “those things that never work.” Prominent location is more critical than many first time deployers realize; if customers don’t immediately see the kiosk as an option to standing in line to order and pay, they won’t know to look for it, and therefore won’t use it.
In choosing a kiosk vendor, cost was the top factor, followed closely by durability and vendor expertise. Respondents are also looking for end-to-end, retail hardened solutions that are upgradeable and easy to service. Peripheral options and wireless were the least important options, reflecting the early days of this relatively new technology for wide-ranging adoption in the QSR space.
For those respondents with no plans for implementing kiosks in their restaurants, we asked why not. Over 46% cited “Other,” and explanations included: “We have small locations and are service intensive;” “Prefer face-to-face customer service;” “Not convinced that it makes sense in QSR;” “Won’t work for us;” and “Not enough info. or testing.” These answers reflect the concerns of many in QSR who will be watching to see how the early adopters fare. As with hotel check-in kiosks, the big players will pave the way before kiosks become necessary tools for gaining competitive advantage through enhanced customer expectations of speed and line busting. “No IT budget” was the reason for nearly 31% of our respondents, followed by “Kiosks do not fit this industry” and “Cannot measure ROI.” Again, these perceptions should change as the technology’s acceptance matures and grows.
FACTORS LIMITING KIOSK IMPLEMENTATION
“WE ARE IN A SELF-SERVICE WORLD TODAY,” INSISTS Gary Dollens vice president of product and design and strategy at Hyatt International. “It is absolutely a critical component to what you should be offering your customer to use it for their arrival, departure and to ensure that the information that the hotel has given the operator is correct.”
Hyatt has already introduced NCR kiosks at the New York Hyatt and the Hyatt Regency O’Hare in Chicago and is beginning the first phase of a nationwide rollout this month. “Our plan is to roll out over 100 kiosks throughout the domestic hotels and we will continue to add functionality to the machines. In many locations we will add additional kiosks as people use them more,” explained Dollens. “We’ve been testing these machines since August of last year, and we know where the bugs were and have them smoothed out. We are confident that we will have smooth rollout.”
This commitment to self-service was not taken lightly at Hyatt and is not the company’s first experience with self-service. “This is not technology for technology’s sake,” says Dollens. “We tried kiosks in 1994 and we were ahead of our time. But, now that the airlines have educated the public on using kiosks it has helped us.”
MEETING EXPECTATIONS Business travelers are expected to keep the kiosks humming. “Initially, we think that it is going to be geared toward the business traveler who knows how to operate the machines,” says Dollens. “The business travelers know what they want and go directly to it. If they need a desk clerk they can go there, but if not they can use the machine and get on their way. Most business travelers have become so used to being able to go right to that kiosk and check themselves in and it is effortless.”
However, Dollens is quick to point out there are significant differences between hotel service and airline service. “The self-service kiosks free up the front desk for those people that really need a particular service,” he says. “Unlike the airlines where once you check- in you are gone, in a hotel guests often use the front desk for a whole host of other reasons. Our real goal is to provide an additional service for those that want the kiosk as a way to simply check-in or check-out, while improving the service level for the rest of the customer base.”
While Hyatt is expecting the kiosks to slowly gain acceptance with all travelers, the company is careful not to make the kiosks a focus of the traveler’s stay. Despite the temptation, Dollens insists, Hyatt will not use the kiosks for other potential services to avoid having guests spend long amounts of time using the kiosks and creating lines.
“The goal of the kiosks is helping guests accomplish what is really necessary for them,” Dollens argues. “Still, you have to ask what will the guest utilize at the kiosks without overburdening the machine. We have been really careful that we control the amount of time at the kiosks.”
The Business Traveler’s
18
19
Which is not to say that more applications may not be added in the future. Hyatt is investigating allowing guests to select room locations. Initially this may be restricted to low medium or high floors, near the elevator, or a particular zone. “Guests may not be able to pick an exact room in the building, but you can select a location very close to where a guest wants to be,” he said. “We also see the functionality down the road of people being able to print out their airline boarding passes. That is where I see this whole product headed in a year or two.”
According to Dollens, hospitality specific experience and functionality led Hyatt to NCR EasyPoint Xpress Check-In kiosks. Given Hyatt’s international portfolio and its commitment to a major nationwide self-service rollout, it was also critical to have a business partner that had an international reach and extensive experience with self-service solutions in a variety of industries, ranging from banks to retail stores to restaurants.
Simplicity and ease of use were critical concerns for Hyatt, when designing the guest interface. Guests can swipe a credit card and after a few touches of the screen an encoded key card and a basic printout containing the room number and directions to the room are created. “For us, the simple functionality of the fully encoded key was very important,” explains Dollens. “Otherwise, the process becomes very confusing for guests. We wanted it to be as simple as possible.” The kiosks also have the ability to print any coupons or comps for guests that are part of a package or other group, such as a AAA partnership or other similar groups.
REINVENTING THE FRONT DESK Dollens believes that as the use of kiosks grows in popularity the concept of the front desk will change. The return on investment on programs such as kiosks is something that hotels are going to have to determine over a period of time, according to Dollens. “If more and more people use the kiosks, we will see some corresponding efficiencies at the front office.”
The location of the kiosk is another factor that Hyatt put a great deal of thought into and will be vital to acceptance of the technology. Hyatt will be placing the kiosks as close to the front desk as possible. “In our tests, when the kiosks are away from the front desk they have much less usage. As a result we’ve decided to put the kiosks right in front of the desk.” Indeed, in the future, when Hyatt renovates its properties or builds new hotels, it will create fully integrated self-service “pods” right in the front desk for maximum exposure and guest use, according to Dollens.
Currently, Hyatt plans to have an employee available at the kiosks to assist guests and handle any issues or questions that may arise. The goal is that if somebody has any questions or concerns mid-transaction, a Hyatt employee is there to handle the issue without forcing the guest to go stand on line at the front desk to get service. As guests become more comfortable with the technology, Hyatt expects the need for assistance will decrease.
“I look at the larger hotels such as the Hyatt Regency Chicago with 2,000 rooms. We currently have five machines in that hotel and I can see up to 10 machines in those locations. We have those big days when you have 1,000 people coming in and you have 500 transient customers who are going to go right to that machine, because they are frequent travelers, they know the east tower and the west tower. They don’t get confused about where they are going in the hotel. It is a 30-second activity for these people,” explains Dollens.
“Kiosks free up the desk for those people that really need a particular service.”
DRIVE- THRU
Produced by
Hospitality Technology would like to thank NCR for sponsoring the first Hospitality Industry Self-Service Study.
21
1