Wednesday, 29 July 2015

The story of smartphone self check-in to a hotel - mission impossible?

Over 4 years ago we set ourselves what we thought was a simple mission;
"to self check-in/digital check-in to hotels on our smartphone".

Our motivation was simple, and it still is simple;
"we want to use digital check-in ourselves in hotels, and it was not available in any hotels". 

But the thing is, our journey so far has been anything but simple.

So here are the reasons for our simple motivations;

  • we don't like queuing to check-in at hotels 
  • we don't like getting locked out of our hotel rooms by demagnetizing keycards 
  • we don't like wasting time at the check-in desk when we can be out exploring city attractions
  • we like to make decisions at the last minute to stay in hotels after hours (especially when on driving holidays) and we don't like being forced to only stay in a big expensive hotels that have 24 hours reception so we could book and check-in after hours; 
  • we don't like wasting time and going out of our way to pick up keys from a Real Estate Agency to stay in vacation rentals. 

We knew we weren't on our own about wanting digital check-in. We found many surveys from well known travel brands showing other guests were like us too - that is they wanted to digital check-in with their smartphones to hotels - e.g see this article here.

According to a recent report from PWC they predict by 2017 at least two thirds of hotels will allow mobile check-in. Although right now, there are still only about 20 hotels on the planet actually offering digital check-in. When we started 4 years ago, there were no hotels on the planet offering digital check-in, but a few were trialing it.

So what's going on, why hasn't digital check-in taken off yet? is there about to be a massive tsunami of digital check-in rolled out across the globe? PWC thinks so. Our story may help answer these questions.

Like many stories ours began remarkably well;

  • In July 2011, we completed building our first digital check-in prototype - Minimum Viable Product(MVP) completed -check.
  • In August 2011, we installed our prototype in an Australian resort and began testing it (see video below) - beta test product in real life environment to prove out the product - check.
  • Over the next few months we tweaked the product and ironed out some bugs from what we learnt on the beta test - refine the product - check.
  • We completed the beta testing with $15,000 prizemoney we received from our local University for winning the Universities annual business plan/entrepreneurship competition (our co-founding team were students at the time) - raise capital, and get some credibility - check, check
  • Earlier in the year we registered a company and formed a co-founding team with a mix of tech, marketing, finance and business people - register a company with 4 skilled and qualified co-founders - check. We were a young team at the time, all in our last year of our University studies; one of us was completing a Bachelor of Computing Science; the other a Bachelor of Marketing, the other a Bachelor of Accounting and Finance, and the CEO was completing a Masters of Business Administration.
  • When we registered the company in Feb 2011, we also submitted an International Patent application - patent application submitted check.
  • Later in 2011 just as we were finishing our beta trials, we received a $50,000 Australian Government Commercialization Grant. Raise capital and get more credibility - check.
  • We received publicity in national newspapers and journals about our grant and we were approached by the CFO of one of Australia's largest hotel chain who read about us in the newspaper and he was interested in buying our product - get traction and begin sales/negotiations - check.
  • We formed a partnership with a lock manufacturer and distributor to take the smart lock in our digital check-in system to market - secure the channels/resources to take our product to market check.
  • And in June 2011, we were selected as one of five finalists in a global business plan competition run by the Global organisation of Patent attorneys, representing our University and beating teams from from Harvard, Stanford, Yale and MIT to be runner-up- more credibility/traction check.

So we had achieved our mission to self check-in on our smartphone in six short months, and at the same time we had launched a start-up and checked all the boxes in readiness to take our product to market. It truly was an amazing beginning.

Here is a video below from August 2011 of our product installed in an Australia resort for the beta trials.

So things had gone so right for us in 2011, but when we tried to start selling our product in early 2012 to hotels, there was this big turning point and things started to go WRONG.

We quickly learned there were many things wrong with our product these included;
  • The hotels did not like the design on the smartlocks we were interfacing too.
  • The hotels did not like our business model
  • The hotels did not like the idea of their guests opening doors with only a time-sensitive code on a numberpad on a lock.
  • The hotels did not like the idea of only having an app to self check-in, they wanted the guest to self check-in on their website too just like with the airlines.
  • The hotels wanted the guest to check-in from an Online Travel Agency too such as Expedia, as well as on their smartphone, and as well as on their hotel website.
  • The hotels did not want to use our ID verification and sign in system on the app, even though this was legal in most countries
  • The hotels did not want the guests to choose their own rooms
  • The hotels did not want to learn any new software to operate the system
  • The hotels did not want to change any of their current practices in how they manage their properties
  • The hotels wanted to continue to offer keycards and metal keys as an option for guests to check-in
So for the next 3 and a half years we went about trying to solve all of the above things that were wrong with our product. In next weeks blog, we'll tell you how we went about addressing all of this.

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