In Q4 2021, cryptocurrencies were riding high while Mark Zuckerberg’s Meta announcement drove every business into a discussion about how they would monetize the metaverse. One year later and this web3 landscape now looks far more fallow. The question for hoteliers: do you react by abandoning your interest in blockchain and metaverse technologies?
Per the title, we caution that hotels take a wiser approach to all new tech. The shiny new tech always gets undue hype, then there’s a correction, and then finally there’s utilization. Right now, we are in the correction phase with of its naysayers in the public sphere spitting on the grave of Meta stock prices while pointing to a few crypto Ponzi schemes as evidence of the whole space as fiction. But there’s light at the end of the tunnel, with real world use cases favoring early adopters.
In the grand, grand, grand scheme of things, all new human inventions in our civilization tend to follow one basic rule: the innovations that increase convenience will eventually become king. We’ve seen this with cars versus horses, with credit cards versus cash and computers versus paper records.
During a positive hype phase, skepticism is a virtue. Likewise during our present-day crypto and metaverse winter, news of their demise are greater exaggerated. Still, there’s a profound lesson from this tech hype ebb and flow that you may apply to any trend affecting the hotel industry.
Namely, ask yourself and your team these three questions:
- How is this more convenient for the guest?
- Why can’t we do this using existing (non-blockchain, non-metaverse) systems?
- Will this save money for the hotel organization or brand?
Perhaps the third question is most important right now because costs are everything. Not just the costs on an income statement, but those in terms of your team’s time which is undoubtedly in limited supply. The mere act of investigating whether or not to put a hotel in the metaverse or set up a non-fungible token (NFT) loyalty program may be too expensive if your IT team is already strained.
Often, when advising hotel clients during a consulting assignment to evaluate their tech stacks, we opt for a ‘better the devil you know’ ethos. Executives or managers may have their gripes about a certain platform or a lack of features, but switching to different systems may be even more painful to the point where it ultimately isn’t worth it. It’s likely better to deepen the team’s training with existing systems so that they can more effectively use their full feature set than it is to start fresh.
Finally, to answer the first question, this is where web3 and the metaverse will eventually win. Once these tools are built in such a way that non-tech-savvy stakeholders (hotel managers, hotel associates and hotel guests) can frictionlessly use them, then there will be mass adoption.
Just consider some of the use cases that are both currently available and soon to be available:
- Payments from crypto to local currency, all with a tap or biometrically controlled approval
- Crypto-based loyalty programs with smart contracts that automatically govern royalty fees to the hotel during any peer-to-peer transfer of points
- Tokenization of each room night so that a secondary marketplace for inventory can be created, allowing hotels to sell low-demand blocks along with better intelligence for maximum rate discovery during peak periods
- Allowing prospective guests to tour a property (like test driving a car) to increase reservation confidence or to aid with post-booking, attribute-based upselling for specific rooms
- Using a virtual reality or augmented reality setup for staff training
- Reviewing and live-updating a property renovation using a 3D-rendered dollhouse view that can also heatmap guest and staff movements to identify possible logjams
- Showing event planners a digital twin of a hotel so that the exact logistics of an event can be reviewed, with the potential to sell them on an increased number of group attendees
Ultimately, what we ask is that you look beyond the buzz words and consider what will drive mass adoption based on convenience and present-day value. Gen Z wants NFT-based loyalty, so planning for that will help to endear you to the next generation of travelers. And while Decentraland may, by some estimates, have less than a thousand daily active users, how many kids these days are logging onto the Roblox servers to play and collaborate on virtual world creation? (Hint: it’s in the millions.)
Thinking broader, blockchain will eventually ‘change everything’ and it is something that you must explore then address in a visionary roadmap. But all implementations must be framed not in terms of what the current hype is but in terms of the fundamentals of hospitality: enhancing the onsite experience and the overall value for customers above all else.
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