LONDON—Hilton is looking to seize on the widespread uptake of such smart phones as the iPhone and Droid.
The hotel company has reentered the mobile download space, after an initial but soon-aborted attempt with WAP in 2001, and launched an iPhone application (or “app”).
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| Hilton's iPhone app allows users to search for a particular city hotel or for the nearest hotel; view hotel facilities and images; book and manage bookings; and use a “request upon arrival” function. |
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Speaking at the recent World Travel Market in London, Chris LaRose, director of Web site strategy and testing at Hilton Worldwide, said the onus is on the operator to move quickly because the consumer already has. With that thought in mind, Hilton’s three tiers of brands—lifestyle and luxury, full-service and focus service—have all embraced mobile technology. The iPhone app, allowing users to search for a particular city hotel or for the nearest hotel; view hotel facilities and images; book and manage bookings; and use a “request upon arrival” function, has launched in the U.S. and will launch in the U.K. during the next few months.
Research conducted on behalf of Hilton Worldwide has indicated the consumer’s desire to start using mobile technology. According to the survey, 58 percent of respondents said they would use a mobile device to check into hotel, 57 percent said they would change a booking and 42 percent said they would book business travel.
So far, the app’s popularity has attested to the survey results. A week after launch, the app was downloaded more than 6,000 times and currently ranks as No. 20 on Apple's list of most popular travel apps. All of the U.S.-based brands, excluding Home 2 (which doesn’t have an open location yet) and The Waldorf (for which it is deemed not yet appropriate), will have a downloadable app by the end of this year.
A strong signal
Even before the iPhone app was introduced, the uptake on usage has been remarkable. LaRose said there’s been “a hockey stick approach with a huge upswing. And we expect more of the same to come”.
He added, “When you have between 200 and 400 percent revenue growth year-over-year, it’s certainly something that people will pay attention to. Granted, it’s still very niche and the space is very small, but when you think about the total revenue that we do online and the potential to shift to mobile—it’s just huge”.
LaRose said the company has seen nearly 60-percent revenue growth between the first and third quarters, as it relates to the mobile space. And the company’s return on investment has doubled since July 2009.
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| Hilton’s three tiers of brands—lifestyle and luxury, full-service and focus service—have all embraced mobile technology |
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What’s more notable is that Hilton’s growth in the mobile space occurred without a shred of marketing. According to LaRose: “Nobody knew it was out there, but they found it on their own accord. This is something of me airing a bit of dirty laundry. We couldn’t get our act together internally to market the app … But what we’ve done is regrouped, and now everyone’s aligned with these iPhone app launches”.
As the infrastructure is in place already for the applications Hilton is offering on mobile devices, such as the “request on arrival” service with room service, housekeeping and other full-service options already established, there is no extra outlay to provide this in the mobile space. In addition, as with online booking and management, the mobile space has the potential to reduce costs of manning phone lines and to limit the possibility of information getting lost between the human who answers the phone and the action that needs to be put in place.
Obstacles and challenges
There are two foreseeable obstacles in the way of mass mobile take up, and one is roaming charges. If a consumer is out of their country of network, there are currently charges for accessing online data. The other obstacle is payment with the fear that some consumers will initially be reluctant to input their credit card details into their mobile phone. However as the technology assures the public it is safe to do so, it is thought the latter issue is not insurmountable.
Last-minute bookings from a mobile phone are prevalent in the data so far, and Hilton also is seeing bookings further in advance and new customers coming to the brand through mobile applications.
Any problems Hilton had in setting up the app came as a result of disruption within the company itself including the change in name, internal reshaping and the moving of Hilton Worldwide headquarters. Other than that, the experience and resulting revenue growth has been exceptionally good and the intention now is to continue expanding their mobile travel services.
“We see nothing but upside”, LaRose said.
