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04/30/2021

Generate New Revenue in the Pandemic Economy: Guest Wi-Fi Monetization Strategies

Today, most hotels monetize their own networks by using them to drive bookings and loyalty programs, but the hotel industry can do a better job of delivering users to their destination with less friction and frustration.
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People depend on Wi-Fi and internet networks every day, yet often, they perceive them as commoditized utilities. In fact, in public venues, customers expect complimentary access to Wi-Fi as part of their experience. Meanwhile, the infrastructure has remained complex and costly when deployed in dense environments like hotels where the number of devices crowd the wireless spectrum and bandwidth. Since providing Wi-Fi is table stakes for delivering a good guest experience, hotels have needed to upgrade their networks at least every five years, an expense that is typically shouldered by the hotel out of unrelated revenue. Hoteliers need to get creative with how they fund these networks.  

In the early 2000s, hotels charged guests for access to Wi-Fi. Internet access was perceived as a value-added service, rather than a required amenity. As mobile devices became equipped with Wi-Fi, hotels deployed purpose-built gateway systems to capture users and collect payment for access. This was a lucrative time to provide Wi-Fi services, but those opportunities are behind us now. Maintaining these “buy-to-browse” solutions costs more than the revenue they generate, largely because more than 50% of the issues guests have with internet access is related to these captive purchase portals. For over a decade, networks have been funded in part by advertising revenue. Boingo was an early innovator in providing this service for venues, but they owned the network and the customer. This model worked for unbranded venues like airports and malls, but didn’t sit well with hotels.

Today, most hotels monetize their own networks by using them to drive bookings and loyalty programs. When logging onto Wi-Fi, guests are redirected to a branded portal and encouraged to sign up for the loyalty program. After relinquishing personal information, they are delivered to a branded landing page with one-size-fits-all marketing offers that further interrupt attempts to get online. The hotel industry can do a better job of delivering users to their destination with as little friction and frustration as possible, whether that destination is their guestroom or a website. There’s nothing wrong with a branded landing page strategy, but newer technology can help eliminate friction, personalize offers, and elevate the guest experience. Cloud5 is partnering with SABA Hospitality which combines a digital compendium for venue information, self-service food and beverage orders, and A.I. chatbot functionality into a dynamic platform for engaging guests. Cloud5 can present room service and other services on the landing page, maximizing on-property spend, and driving revenue to support the network.

Advertising also creates ways to monetize networks and help offset some of the cost of critical network upgrades. Currently, there are advertising platforms for the hospitality industry that follow two models. The first model caters to the user by collecting data to build a profile. It combines the profile and location to personalize and localize advertisements to enhance the guest experience. The second platform’s model is designed to present advertisements that are “on-brand” for travel and tourism businesses.

Brands can also monetize by promoting other products or services outside the core product of reservations. Driving greater downloads of a branded mobile App is one such case. But until recently, there really wasn’t a technology solution to drive App adoption. Developed by the Wi-Fi Alliance (WFA), Passpoint enables mobile devices to join participating networks without jumping through the usual hoops. Passpoint networks’ architecture far exceeds the open or restricted public networks available in most venues by being truly secure with authentication and encrypted traffic. Passpoint accomplishes this by loading a certificate onto the user’s mobile device or laptop. This certificate is presented seamlessly to the network, however, getting the certificate loaded on the device is not seamless… unless you use an App. You can embed the certificate in a branded App and make the access experience frictionless. The App is the vehicle that provides a seamless user experience for the guest and the marketing impression for the brand.

Customer data is among the most valuable assets a brand has, and they have been leveraging networks to capture “first party” data for some time. This data is even more valuable if it can be tied to the mobile device a customer carries everywhere they go. With recent changes in mobile operating systems like Apple’s iOS 14, the device’s MAC ID is randomized per network. This makes it nearly impossible to complete the data profile of a guest, however, leveraging data from mobile Apps and Passpoint certificates can still help complete the picture of the customer. The most recent network monetization development leverages the Passpoint standard in tandem with WBA OpenRoaming™ developed by the Wireless Broadband Alliance. This establishes a framework for multiple networks to grant access to multiple Passpoint certificate originators from brands to MNOs. The Passpoint solution has always promised adopters the potential to accept cellular network customers onto their Wi-Fi networks and receive payment by MNOs. There is an OpenRoaming Free model that aims at driving visitors by providing easy access to the amenity network and there is OpenRoaming Settled that brokers the financial exchange. Next, venues and MNOs will be able to use solutions built on this framework to dynamically establish rates and terms with one another and form a marketplace.

In conclusion, as brands and venues seek to offset the costs involved with delivering a great guest experience, it is important to explore the most effective ways to monetize Wi-Fi networks. New technologies will help brands reach the ultimate goal of seamless, secure, and frictionless user experiences as guests access venue Wi-Fi as well as advertisements and content tailored to customers’ digital data profiles. Implementing modern monetization strategies affords the opportunity not only offset a hotel’s network investment but also to create a meaningful new revenue stream.

For further details on the latest Wi-Fi monetization trends and best practices, click the link below to register for the upcoming webinar: Generate New Revenue in the Pandemic Economy: Guest Wi-Fi Monetization Strategies

May 20, 2021 

11:00 AM Central Time (US and Canada)

https://us02web.zoom.us/webinar/register/WN_l_IKKQBuT0O_9Z_O4vKPgQ

Panelists:
Host:  Armand Rabinowitz, VP of Product Development, Cloud5 Communications
Rachelle Peterson, Global Distribution Director, CNN International at Warner Media
Rafael de Albuquerque, Founder & CEO, Zoox Smart Data
Rich Mazzola, Business Development Lead, Google