Patrick Dixon has been ranked as one of the 20 most influential business thinkers alive today by Thinkers 50. He’s often described as a Futurist keynote speaker, and he’s authored 16 books (650,000 in print in 40 languages) including Futurewise, SustainAgility, The Genetic Revolution, Building a Better Business, and his latest book, The Future of Almost Everything.
Patrick consults to multinationals on wide range of trends / strategic issues, across every industry, and keynotes at conferences on global trends in up to 4 countries a week (53 nations) – from 15 to 4,500 people in each group, for companies such as Google, Microsoft, General Electric, GSK, Siemens, Phillips, AT&T, BP, Prudential, and Barclays Bank.
He has contributed (keynotes / lectures) to Executive Education, MBA and many other programmes at London Business School since 1999, as well as to Open Programmes at six other business schools.
Patrick is Founder and Chairman of Global Change Ltd (trends and strategy consulting), Chairman of Virttu Biologics Ltd (cancer research biotech), and non-executive director of Acromas Health Care Ltd (Allied Health Care Ltd, Nestor Health Care Ltd and Saga Health Care Ltd).
In This Episode, Patrick Talks About:
- What it means to be a futurist
- Motivating your staff, and the mistakes that many companies that demotivate their employees.
- How to amaze your guests by looking at the experience you create at your hotel from their perspective.
- Understanding how your customer is feeling right now – are they exhausted from a long day of travel, stressed about a business meeting they have tomorrow, hungry, thirsty, tired?
- Big data, and ways technology can enhance the customer experience.
- Social media, reviews, and the truth about how Google ranks reviews.
Resources & Links
- The Future of Almost Everything
- Futurewise: Six Faces of Global Change
- Sustainagility: How Innovation and Agility Will Save the World
- The Genetic Revolution: Today’s dream or tomorrow’s nightmare
- Building a Better Business: The key of Future Marketing, Management and Motivation
Guest Soundbite: Every leader is a futurist. You can’t lead without a vision of the future. You pick up the Wall Street Journal, or the New York Times, or the Financial Times, you’re not really reading it for today’s headlines because today’s headlines is simply about what happened yesterday. When you read today’s headlines, you are automatically, in your mind, thinking “I wonder what tomorrow’s headlines will be” or “Where the story’s going to go”. It’s a human instinct. We all do it.
It’s part of the human condition to plan, to think ahead, to strategize, to fantasize even, to have hopes, to have dreams. This is all part of the future. All leaders lead from a big dream, a big future vision. The more you can excite the people about your vision of the future, the more powerful your leadership will be.
Jon: This is the Lodging Leaders Podcast with Jon Albano. Session number 24.
Intro: Welcome to the Lodging Leaders Podcast, where top performing hoteliers and hospitality industry experts share powerful insights and actionable advice to help you grow your portfolio. And now your host, Jon Albano.
Jon: Hey everybody. Thank you so much for joining me for this episode of the Lodging Leaders podcast. You can find the show notes, links, resources and comments section for this episode at lodgingleaders.com/24.
Today’s guest is Patrick Dixon.
Patrick is known by many as Futurist. He’s been ranked as one of the 20 most influential business thinkers alive today. He’s authored 16 books including Futurewise, SustainAgility, The Genetic Revolution, Building a Better Business, and his latest book, The Future of Almost Everything. He’s given keynotes for companies like Google, Microsoft, AT&T and GE, and he consults to multinationals on wide range of trends and strategic issues.
In today’s interview, Patrick talks about what it means to be a futurist. He talks about motivating your staff, and the mistakes that many companies make that demotivate their employees. He talks about how to amaze your guests by looking at the experience you create at your hotel from their perspective. It’s the little things that really matter. He says it’s the emotional connection that we have with our customers that makes them our friends for life. We need to understand how the customer feeling right now. Are they exhausted from a long day of travel, stressed about a business meeting they have tomorrow, hungry, thirsty, tired, need a bathroom? He talks about big data and ways technology can enhance the customer experience. He talks about social media, reviews, and the truth about how Google ranks businesses.
Patrick has a lot of great ideas and he’s very engaging. I hope you enjoy it as much as I did.
So without further adieu, I give you Patrick Dixon.
Jon: Patrick, welcome to Lodging Leaders. Thanks so much for coming on the show today.
Patrick: Thank you!
Jon: It’s good to have you. I was thinking about Judy Maxwell, is a good friend of mine and she’s the editor of a AAHOA Lodging Business and Asian Hospitality magazine. She found your YouTube video on the Irish Hotel Federation keynote speech that you did. She sent me the video and she said “Look, you got to have this guy on the show. He’s a futurist, has a lot of great things to say, and I think he would be a really good guest to feature.” So I watched that and then I did a little research on you. I saw that you’re ranked as one of the 20 most influential business thinkers alive. You’ve authored 16 books with over 650,000 in print in 40 languages, including The Future of Almost Everything, Futurewise, Sustainagility, The Genetic Revolution, and Building a Better Business. Do I have that correct?
Patrick: Yeah, that’s correct.
Jon: It’s amazing. I just wanted to bring you on the show and see if you could share some of your thoughts on what it means to be a futurist and how that’s going to affect the lodging industry in the future. Does that sound good to you?
Jon: Okay, great. Let’s start out with you sharing a little bit about your background so our listeners can get to know you.
Patrick: I started off as a physician, a doctor, a real doctor looking out to people who are sick. But even before I started my full-time job as a physician, I’d taken my first sabbatical to start in IT. I’ve been multi-tracked to my life as the serial entrepreneur, a philanthropist, a physician and a writer, as well as an adviser to multinational corporations on global trends, which is what I do mostly these days.
Jon: Where does the information, the inspiration, for these ideas come from?
Patrick: I guess it comes from traveling. I think it’s tremendous privilege. Those of us who are working with companies around the world have the opportunity to visit maybe 25 different countries a year, with maybe 15 to 22 different industries a year, working with people who are cutting edge of change, people who are innovators, entrepreneurs, people who are breaking the rules of the business that they’re in, reinventing the future. I find that absolutely fascinating.
Jon: That’s fantastic. You’re known as a futurist. What does that mean?
Patrick: I guess we’re all futurists. You can’t lead without a vision of the future. You pick up the Wall Street Journal, or the New York Times, or the Financial Times, you’re not really reading it for today’s headlines because today’s headlines is simply about what happened yesterday. When you read today’s headlines, you are automatically, in your mind, thinking “I wonder what tomorrow’s headlines will be” or “Where the story’s going to go”. It’s a human instinct. We all do it.
It’s part of the human condition to plan, to think ahead, to strategize, to fantasize even, to have hopes, to have dreams. This is all part of the future. All leaders lead from a big dream, a big future vision. The more you can excite the people about your vision of the future, the more powerful your leadership will be. Every leader is a futurist. Therefore, every writer is a futurist, every journalist, every politician. We’re all futurists. Every mother and father is a futurist. Why? Because we invest in the future of our children. We have hopes and dreams for them.
A futurist is simply someone who has the privilege of spending all that professional life thinking and discussing and debating and analyzing the future. My job is to live in the year 2030 and to see tomorrow as history.
Jon: I noticed that one of the topics that you talk about is employee motivation and you’re talking about attributes of being a great leader. Can you talk about employee motivation? The reason why I asked on that is if you think about the hotel industry, unfortunately the way the structure of that model is that most of the people that interact most heavily with your guests are your line-level employees. Employee motivation is really critical to have, just a stellar staff that really delivers a high level of service whether it’d be a housekeeper, a front desk manager, the bellhop, even the shuttle driver. What do you recommend on that to motivate your employees?
Patrick: Yeah, people often say “Oh come and give a motivational speech.” We all need motivating. Quite frankly, companies are quite good at demotivating people. The fastest way to demotivate your team is to talk about share results and return on equity and improving your percentage share of the market. These things are frankly boring to most people. They paralyze people with boredom. Actually I see this at corporate events all over the world. There’s one big thing which motivates at just about every human being that’s breathing on the face of this planet. That is the desire to make a difference, to know that because I did something well, I’ve really made a special difference to someone’s life. Now that is absolutely the key to motivating frontline staff.
It might be that you’re an organization delivering care for people who are sick at home. I tell you it’s the same. The carers who go into the home of someone who’s 95 years old will probably be some of the lowest paid people in your community. But they are doing amazing things. They need to know that every day, they put a smile on someone’s face. Every day they enable an old person to stay at home. Every day they give someone dignity and empower them to live their lives.
That is exactly the same spirit of motivation that needs to apply to the janitor who is taking care of the restroom in the reception area of one of the five star hotels in New York. You may think that you are in the business of cleaning restrooms. Actually, you’re in the hospitality business because the very first place as we’ll discover later on in this interview probably. The very first place that our guest needs to visit, as a matter of urgency, when they arrive after a very long travel is probably going to be the restroom. The first impression of this entire hotel and the most lasting one may well be what they find when they get there. You’re in the health business because when the restroom’s clean, it keeps people healthy. You’re in the hospitality business because you’re welcoming people with a smile when they’re coming in and you’re saying “Hi, welcome to our hotel. Can I help you?” and so on.
It’s the same for the person who’s turning down the bed in the evening, or for the person who’s cleaning the balcony. Dealing with their annoying rattle in the air-conditioning unit, it may not seem a very big thing to them but that little rattle is going to spoil someone’s night sleep tonight and probably has wrecked someone’s night sleep for the last six months. Little things really, really matter. They really, really make a difference. When you can show someone what a hero they are for the things we say or do, you will find that they will follow you to the end of the years. Because the most important thing for a human being is knowing that they’re valuable, that they have meaning, that what they do is important and that they have a vital role to contribute.
Jon: I hear the motivation on how you’re positioning it with your staff. But how do you recognize the staff? so job well done because not every guest is going to as they dry their hands in the bathroom say “Thank you. The bathroom looks great.” for example. You know what I’m saying?
Patrick: Yeah, I do. I think it’s very important. I think a good hotel manager will know, I’m sorry to go on about restrooms, but will know all the people that came to the restrooms by name. It shows, it’s a signal, it’s a sign. The people that you called past that you think are nobodies, they are the most important people in our hotel. I say it’s exactly the same for the people who clean the rooms. It’s the little things that really, really matter. One of things we learned from things like Disney and theme parks is that everyone is part of the cast. It doesn’t matter whether you work front of house or you’re back of house, whether you work cleaning dishes, whether you’re sweeping the floor, whether you’re planting bulbs in the flower beds outside the hotel – everyone is part of the cast. We’re all part of this wonderful welcoming team who are creating, hopefully, the kind of atmosphere that makes people think that they really belong to us.
Jon: You’re so right, too. By the way it is the little things. You could have a stellar, a five-star hotel and every appointment in the room, but if the toilet in your bathroom, in your guest room is not clean or if the bed was not made properly or if you didn’t have enough towels, that’s what you’re going to remember.
Patrick: It is. The funny thing is hotels can so easily get it right but they so easily get it wrong. It’s not just hotels as well. It’s in related industries. Let me give you one small example from an airline and then let’s see how this works out for the hotel industry. I travel a lot across the Atlantic. Because I fly out to London a lot, I often travel on BA but it could just as easily be American Airlines. What I’m going to say would apply to both. When I’m going out west, obviously the adrenalin is running. I’ve got a 12-hour flight and I’ll have won the extra hours because I’m traveling. I’ve got a very, very long day. I’m probably going to walk straight to the business meeting then into a dinner. Then at the following morning, I’m going to give a lecture.
What do I need on the plane? The answers are I need power and I need the Web. Do I need champagne? Not really. Do I need movies? No. Do I need a bed? Yes, for an hour, that’ll be handy. But actually I don’t need any distractions. I just want to work. When I’m coming back, I’m completely bushwhacked. I am wrecked. I’ve been in New York for 36 hours working incredibly hard and I’ve lost quite a lot of sleep because I’m jetlagged. Do I need food? No, thanks. I’ve had it in the departure lounge before I got on the plane. Do I need alcohol? No, I just want to sleep. Do I need breakfast? You must be joking! Do I need any announcements during the flight? Please, no. Actually I just want pitch darkness, absolute silence. I want an instant bed. I want two bottles of water, three bottles actually with me as I fall asleep so I don’t have to ask anybody for anything. I want a well-made bed and that’s it. Just let me go.
The most important thing, therefore, for the airline to know about me is this: Is Patrick Dixon flying out or is he coming home? In fact, in terms of big days, we can get very lost in all these kind of stuff. For me, most of it is irrelevant. It’s little things that really matters. They just need one symbol by my name – O or I. O means outgoing, I means incoming. And they should have that for every business guest printed on the passenger manifest. Do you reckon British Airways does that? No. Do you think American Airlines does that? No. It’s the most important thing they need to know about me. If they know that I’m going out or coming back, they know everything about my needs. The other thing they need to know really is how long is my stay going to be in the US. Because again, that will profoundly influence what kind of requirements I have out and back. That’s a very, very simple thing.
We could move on to hotels now but I can give you 10, 15 or 20 examples that are as simple as that, that could completely transform a hotel’s relationships with their customers. The wonderful thing is it costs nothing.
Jon: Actually, let’s dive into that. As you’re talking, one of the things that always drives me nuts whether you’re staying at a budget hotel or a five-star hotel, I like water. I drink lots of water especially when you’re traveling because you get dehydrated. Nothing annoys me more, if you don’t have any water you have to go down to room service or go to a vending machine. Or if they have the bottles of water with little tag that says $6… It’s ridiculous! What does a bottle of water cost a hotel? They had a couple of bottles of water for every one of the guests or even as your first point of entry, you’re walking in, you just got out of the cab. Maybe the first thing you need to do is the restroom as you said. The second thing is give me a bottle of water while I’m waiting in line to check in. Let me hydrate. I can say no but offer that to me right away.
Patrick: That’s right.
Jon: It’s almost a non-expense for a hotel to offer an inexpensive bottle water. It’s a huge perk. I’d like that more than a prettier duvet on the bed.
Patrick: The thing that’s ludicrous about it is the biggest mistakes are being made by the biggest chains with the most stars. I can forgive a budget airline and I will certainly forgive a budget hotel. If they’re only charging say $45/night, God bless them. Goodness knows how they’re managing to do it and pay anyone a decent rate of pay. I will forgive the room if it’s not pristine clean and the air condition doesn’t quite work. That’s fine. But if I’m being charged $350-$400/night and I go in there and actually, if I touch that bottle of water I’m going to be charged $8, I think that’s criminal. And then I go to the Internet which is the other thing that’s going to kill me. Of course the first thing, I come in, I need water, I need the web. I can’t go to sleep because I’ve been working out some huge files and I just got to get them out my machine. In my case, it could be very big files of presentation. The person is shouting for them. They need them tonight. They’re going to look at them overnight lecturing on the issues tomorrow. So I’m going to sit there waiting to get rid of these files.
Then the first thing I discover is I can’t get online. Why is that? Because they want to charge me. They want to actually give me the password. By the way, they probably didn’t even give me the password in the lobby downstairs. I just want to be online and by the way, I don’t want to know whether I’ve got a choice between an ordinary service which basically means it’s going to take 25 hours or a medium service or a premium service. It’s probably still quite slow. I just want really, really fast web. If I’ve paid $350 for my room, I do not expect to pay any extra for it.
I always say this that the future is not about innovation. It’s not about smart tech. It’s about the single word, the single word which will drive the future more than anything else. It’s driven most of human history. It’s reactions to events which drive history, not the events themselves. It’s reactions to what a guests find in their room that makes all the difference. It’s all about emotion. It’s the emotional connection that we have with our customers that makes them our friends for life.
I’ll give you another example of small things. My rule is this: Always treat your guests as you would treat your mum. I remember, it’s a little while ago now but it’s in the days when I was still having to dial a phone connection sometimes to try and get even some kind of web connection in the hotel room. I remember I went down to the lobby and they offered me a bill for $250 for I think 30 missed calls, 30 times I’ve tried to dial this internet service provider and they last a couple of seconds [inaudible 0:14:19.6]. I said to them, “Hang on just a minute. Where was the warning that said that every local call will be charged at $5 minimum charge or whatever it was?” They’re absolutely ridiculous. They hedged and hedged and they hedged and they pushed back. I suggest, listen. “Imagine your mum comes to stay in the hotel. What’s the one thing you’re going to say to her?” You take her and say “Mom, just promise me one thing. Enjoy the hotel but don’t touch the phone.” Because we’ll kill you. If you say that to your mom, then you should say that to your guests. There should be hidden charges. There’s no small print in there for things very simple.
Another example of where hotels get it wrong. I remember one time I came in off a very long distance plane and I came to a 5-star hotel. They did some things nicely. They met me at the door. By name, they knew who I was. They could see me coming from million miles away because their systems told them that which is great. They said “Dr. Dixon, VIP, come and sit here. Come and have a cup of coffee.” I didn’t want a cup of coffee. It was about 3:00 in the morning my time. I just needed to go to bed. We’ll just take it possible to wait. They took it away for ages. I was 20 minutes sitting there with nothing happening. I didn’t need the cup of coffee. I didn’t want to drink a champagne. I just wanted to go to my room.
The most important thing is to understand. It’s the same thing as with the British Airways or American Airlines. We need to understand how is the customer feeling right now. I remember another time, I came into a lobby. I came in full of suitcases. I had stacks of books with me which were for participants for me to sign and had all these things and my heart sank because I saw that there was a massive conference. Some coach have just arrived before me and there look like 300 people waiting to check in. I was desperate to go to the toilet. I couldn’t do that because I don’t want to leave my luggage and, oh my word. Anyway, the security guy came straighter over and he said “Would you look me to look after your luggage? It seems like you probably want a restroom to freshen up.” I was so grateful. How did he know that? It’s just because he was using his eyes and looking around.
Another example of it is restaurants in hotels. Again, the eye is the most important tool that any member staff has. It didn’t matter who they are. They could be the gardener, the cleaner, the cook. But the eye is the window of the soul. You can read someone’s eyes. The most important thing for anyone in restaurant to do is if they’re a waitress, they’re constantly looking around the restaurant, constantly looking to catch the eye of someone. Most things can be communicated with just a very small signal. It’s obvious the person is asking for the bill or they’re looking for another bottle of wine or they’re waiting the next course. They’re still waiting for that guest or whatever it is. A good waiter can read the mind of 300 guests at different tables at the speed of light in 2 or 3 seconds. As an example of lots of little things, it really, really add up to a very, very big difference.
Jon: The keynote that you did at the Irish Hotel Federation event, you actually talked about how to amaze your guests. You’ve talked a little bit about that right now. Do you have any other suggestions?
Patrick: I think it’s just try to remember what it’s like to be a guest yourself. Here’s another example. It turns out to be an almost universal problem. I’ve been doing a global survey on this particular issue. You check-in, you get into the hotel room at 10:30 or 11:30, maybe quarter to midnight. You know you’re going to have to be on your feet tomorrow morning and breakfast is 7. Looking good. You go to your suitcase and, of course, the inevitable has happened which is that you’re pulling out a creased shirt. The first thing that every executive does, male or female, at that point and I know this because I polled people in my conferences. They all laughed at this.
You go straight to the wardrobe to look for the iron. Of course in the budget hotels, there’s an iron but in the five-star hotels, they want you to use the concierge service. They want you to phone down and all the rest of it. But at midnight, I want to go to bed. If I see an iron and I were relaxing, I don’t need to worry about this. I’ll do this in the morning. But if there’s no iron, I’m thinking “Oh my, what am I going to do now?”. If I phone down, I’ll have to wait 20-25 minutes and then they’re going to take my shirt away. When are they going to bring it back? I don’t want to be woken up for a shirt. And what if they don’t bring it back? It’s no good to be phoning around at half past 6:00, saying, “Has anybody seen my shirt?”
Actually what do you do in that kind of circumstance? I can tell you that most executives at that point, they go to the shower. They take a coat hanger. They put that shirt on the shower. They turn the shower on full and they hang the hanger at a place where it’s going to get mighty steamy. Then they’ll leave it there for 10 or 15 or 20 minutes. It’s just absolutely dreadful things for the environment in wasted energy and water, appalling things for the decor and the mildew and molds in the shower. It’s actually a complete waste of time. I’ve been discovered it’s not just me that finds that they’ve been dropped the shirt in the shower by a mistake or it falls off. Again, very, very simple things. Make sure the guest can iron his own shirt.
Jon: It is a small detail, but it is huge. They should have that option available for you.
Patrick: Make sure that there’s something that’s got carbohydrate in the room. There’s no point getting a fruit bowl. Who wants a fruit bowl at 3:00 in the morning? If you’re jetlagged, then you need to sleep. You need some cake and some bread, some biscuits.
Jon: But it’s going to have a little tag on it that says it’s $8 for that granola bar. So let’s move on to technology. I saw that one of the topics that you speak on is Internet of things. For everyone’s information, that’s really just everyday objects that have network connectivity so that could be allowing them to send and receive data. I feature back in episode 19, I featured a guy by the name of Les Ottolenghi. He is the global CIO and chief innovation officer for the Las Vegas Sands. This guys is a real pioneer. He was actually the brains behind the Holiday Inn brand going online and being the first hotel company to sell hotel rooms online. He talked about that.
He talked about the hotel industry, where it was going and he talked about things like for example smart keys in your car. They have some integrations with their property management system so when you enter the hotel or if you’re driving into the parking lot, they’ll have an alert that comes up. It will say “Mr. Dixon, thank you for joining us. You room is ready. Here’s your key.” That kind of thing. Or also using technology with lights so they actually know where the guest is in the hotel at different times and they can send them push alerts and things. What can you talk about as far as Internet of things and how it’s going to change the hotel industry?
Patrick: Let me just say once again, let’s look at it from the hotel point of view. Let’s look at from the customer point of view. What are the kind of things that will make your life easier for your customers? Here’s a list. I’m going through this list. People listening to this saying, “hey you can’t do that to me.” Just pause for a moment, take a deep breath and let’s think about what the customer would love. Then we can think about whether we can provide it. I’m on the way to the hotel. Before I’ve even arrived half an hour into my journey towards the hotel, I get an SMS confirming me the room number. It’s either enabling my iPhone or whatever to unlock the key directly or unlock the door directly through near field technology. Or it’s given me a code which I could punch in to the door as soon as I arrive. Actually, going to the reception desk to check-in is a complete and utter waste of time. You say “Oh no, straight away. Oh no, you can’t do that because you have to have passports and IDs.”
Listen, in the smartphone, digital world we can certainly do all kind of thing beforehand. It is not necessary to do it in the way it’s been done in the past. If in the worst case you can send a member of staff up to collect the passport if you really need an old-fashioned copy. It just should not be necessary anymore. So you punch the number in and you get access to the door. That’s the very first thing. Secondly, let’s make sure that we keep the Internet of thing simple inside the room. When you’re going into your room, I don’t know how many times you’ve struggled to turn things on or off. Every hotel room seems to have some design genius that seems to design his own thing. Each room has got its own computer program for this lighting system. Actually it’s inconvenient.
What a guess wants is a series of very, very simple to operate switches, the kind of things that they used to at home. I guess it’s fine to have a bathroom light that turns on automatically since you walk in. But actually, a lot of these things aren’t as useful as you think. They save the hotel money because they turn the lights off as soon as the guest comes out in theory. But again, how many of us have been in the bathroom? You’re just lying there having a hot bath and suddenly the lights are going out because it doesn’t see any movement.
Let’s keep it very simple, very convenient and appropriate. I’m saying billing, keys, all those touch points should be completely digitized using the hotels own app. But be very careful not to stretch too far beyond that into things and sound very small. Always think not about the big dates but always think about the little dates as individual human being, the individual guest right now somewhere in your hotel.
Certainly, yes I think SMS is a wonderful technology. I’ve already mentioned in terms of the arrival system. I think it’s a fantastic way to communicate with the guest. If you ask people what means they would use to get a message an urgent message to another member of their own family, they’ll always say SMS. Always. If you ask a conference delegate and say the question, just suppose, heaven forbid, just suppose a member of your own family was desperately ill 7.5 thousand kilometers away. What is the method that you’d expect them to contact you? Answer: SMS. SMS is a very personal thing. It’s not associated with businesses. It’s associated with relationship. It’s a fine method for the hotel to use. Near field communication is very good, helping to understand where the person is within the hotel rooms and facilities and lobbies and things like that.
Here’s another thing. I don’t know how it turns you being to the hotel, perhaps to attend some kind of a conference or meeting and you’re not sure where the meeting is. The hotel should be able to know that you’re a guest, that you’re a part of that particular group. They should be relaying meeting times and places to you regularly. They should be saying things like 7 o’clock there should be SMS saying “Breakfast is being served for you and the other participants from your company at X place, 2nd floor” and remind the meeting starts at 9:00 in x room. Fantastic!
You might think that a conference organizer should supply that but it’s a bit of a pain for them to do it. They print their programs and then they hope for the best. Those are kinds of things that should be automatic in terms of the hotel’s communication with their guests.
Jon: As far as with the guest and the push notifications, that would be extremely helpful, I think, because I’ve gone to many conferences and end up spending 20 minutes walking around aimlessly trying to find your way around. If it’s a large conference center, there may be 3 or 4 large events going on. Now you wait in line at a registration or a check-in counter and you realize it’s the wrong event. If the hotel can, even with the meeting manager, do a CSV export or something of the schedule and then associate that with the room block and then send those push notifications out somehow. Absolutely!
Patrick: The hotel has a lot of information. They know which guest is belonging to which group and they know which rooms are being booked by which.
Jon: I’m sorry. I was going to ask you if we can move on to social because I saw one of the things in your presentation that 80% under the age of 35 years old in the United States uses social media while traveling. Travel industry, people make all purchasing decisions based on reviews and especially with the discussion that’s going on in that way. It can really either make or break a hotel. I want to get your input on that.
Patrick: That’s certainly true. It’s a very tough and cruel world. But the good news is that you can be a small hotel chain and you can’t afford a big advertising budget but you will shine like the noonday sun. You will shine very bright and you will do really, really well if you just take care of your customers beautifully and treat them like your old friends because you’ll score very high on all of these platforms and things like Trip Adviser and so on. I think the power of the social media can’t be overrated when it comes to travel and it will become even more so. It’s got to the point where you can have the biggest advertising budget in the world but if the social media is unable to support you and in your image, then actually you best to sort your image out before you do your big campaign.
For example, let’s say one of the biggest global chains decides to do wall-to-wall media coverage by taking huge ads in newspapers, billboards, their advertising on the side of buses and trains and planes and they’re going really big time on radio, TV, everywhere. But the trouble is what that’s actually doing is it’s raising the consciousness of the customer usually not the point where they’re suddenly darling. But it just means that your name is in their minds, which is great. The point comes when they want a holiday or a hotel for some business reason. Then they’ll type in your name into Google.
The moment that happens, you’re then turned into social media because Google has engineered the web to make sure that a hotel website doesn’t appear. That’s a deliberate strategy and the reason is that most people are not interested in websites. They do not believe the message from the CEO or the marketing department anymore. They actually want social media. Google is pushing up the rankings of social media sites and forcing the hotels to buy pay per click presence on the right-hand side. What it means is that most of the traffic’s going to go straight into the first social media sites which appear. Most of it will go into the top 10.
Let’s suppose you type in the name of the hotel. Suppose the first thing that comes up is lovely hotel, but pity about the rats and I nearly died of food poisoning. That’s the first thing that appears. Then the second one down says “Disgusting hotel. This place should be closed down. It’s a health hazard.” and that’s a completely different side. The hotel is messed up. Every million dollars they spend will even more damage the reputation. Why? Because all it will do is amplify stories about mice, rats and people dying of food poisoning.
The trouble is those stories may not even be true. They could’ve been invented by a competitor. They could have been invented by a really angry member staff. But people will believe them. It’s interesting. If you show some really extreme possible or negative messages, people know that the really extreme positive messages are nearly all written by hotel staff. They just know that. By the way, hotels, just to comfort hotels. Hotels that score regularly 4 stars or 4.5 will get more customers than those with score 5. Why? Because nobody believes 5 stars are possible. You know those answers are manufactured.
Jon: Nice! I didn’t know that. Is that true?
Patrick: Yeah. A hotel or restaurant that scores 5 stars on some electric device is people know that they’re playing a game. They’re playing a game. You expect to see some negative reviews because you can’t please every customer. There’ll always be some customers that say “It wasn’t cultured enough.” Well the answer is it’s a very international hotel. Then others say “It was very international but it was full of local culture but I wished there’d be more English speakers.” You can’t please everybody. Every hotel will expect there are gonna be some people who’ve made a poor choice and were bit surprised by what they found or they’re just awkward people. It’s the whole tone of the spectrum of comments which make the pattern of believable insight into what the actual is like.
But what I’m saying is this. When I’ve shown people extreme comments, you know, like the one I just invented about cockroaches in the rooms, the rats running around and I needed to either food poisoning. Then you showed them the fantastic one. Most people, if they’re given a choice between a fantastic review, an absolutely diabolical one, or the official website, most people will go straight to the terrible review. They will ignore the website because who wants the website? It’s just what it is. It’s just marketing spin. They couldn’t care less what the CEO says about the hotel or what the local photographer shows. It’s completely irrelevant.
What they want to know is what’s the worst customer experience. That’s what people are grabbed by. Even though, when I tell them, I said “You knew when you pressed that button, you knew that the comment was so awful it had to been written by a competitor, right? And then everybody laughs. But you still pressed on it.”
The power of social media is that most people will believe the opinion of a complete stranger even if they suspect the stranger was paid by a competitor more than they will believe the marketing director of the hotel. Is social media important? You bet, it is!
Jon: It absolutely is.
Patrick: Should we be terrified of one bad review? No. in fact, an occasional bad review simply builds the integrity of your brand. But what’s very, very important is how we handle them so that any decent hotel or restaurant will be answering just about every review or comment that’s posted and saying things like “Thank you for visiting us. We really look forward to seeing you again.” or saying “I’m so sorry that your meal came out cold for the main course. We work whatever problem the kitchen at night as you know. We did give you 50% refund on your entire meal. But we look forward to seeing you again.”
Often there’s another side to the story. Sometimes I’ve seen people post things like “Mrs. Jones, we do welcome feedback. But according to our records, you have never visited our restaurant. In fact, it was closed for refurbishment on the night in which you said you were with us. We wish you well with your culinary habits, but please keep to the truth.”
Jon: I’ve heard some things actually that there are ways and I don’t know if this is accurate or not, but that if you have a negative review, you certainly want to respond to it. But there is a technique to responding to it where you can actually use keywords that are more of a positive spin. So if somebody said that the room was hot, you could say “I’m sorry the room temperature wasn’t as cool as you would like it.” or something to that effect where yes it’s a spin on words. But from a search engine’s perspective, it’s going to have a more positive result and move you way up.
Patrick: That’s true. But I suggest be careful about hat. The most important thing is to get the tone right in the response. But yes of course, be careful about the words you use. The important thing is to accept. Take it all on the chin and be magnanimous about it and say “Yes, we messed up” or even if you think you didn’t. I think the key is, generally and not just on social media but generally, to be extraordinarily gracious and generous wherever you possibly can, when someone’s raise to complain. I know people are always afraid to see. The trouble is that they get around on social media and everybody will be looking for free lunch. But actually that’s not usually what happens.
A really bad complaint can be turned into a wonderful, wonderful growth opportunity. I’ve seen situations where a customer who’s been terribly upset have turned out to be some of the strongest advocates of a particular brand because they say “They were just brilliant in sorting things out” because everybody knows that things can go wrong sometimes.
Jon: If you think about big data though and you kept on going about little data, which is an important way to look at the data. Les Ottolenghi was talking about using your internal data. That would be stuff like your property management system data, your financials, things like that. Even your loyalty program data. But then also looking at the correlation with that and what’s going on with the social discussion. What are people saying about your hotel or what are some of the trends that people are saying about hotels in general. It’s the combination or the correlation of that data that helps you be more proactive and setting the appropriate direction for your hotel. Do you have any thoughts on that?
Patrick: I think the important thing is let’s not get be two-phased about this. Data is only important if it gives you a direction to change. Otherwise it is just irrelevant. It’s just noise. Big data can throw up an awful lot of noise. The most important thing is to use good old-fashioned human intuition and ask questions that you have about your particular customers. Remember the story I told earlier about my different needs going out one way across the Atlantic and coming back. Big data wouldn’t have told you that. It would not have picked up this huge difference in the outgoing and the incoming, which is so incredibly obvious. I mean, every traveler knows it.
But Google wouldn’t have picked it up or would have taken an awful long time about it. But a human being can pick it up in no time. The human being can then interrogate the data. So you say, okay let’s look at incomings and outgoings. Let’s do a special market research survey on outgoing and incoming. Let’s do an observation about how many passengers are refusing meals, entertainment, breakfast and everything. Let’s try and match their refusal with other things that we know about so we can predict in advance who’s going to review the things. Once again, I say there’s big way around to crack a small nut because the answer is so obvious and I’ve just given it to you.
I would say people who are going to make the most money out of big data and some of the will lose billions of dollars on this. The people that are going to make the most money out of big data are people who are going to use common sense, intuition, better market research to start thinking. That’s why it took a lot little data. It’s the 20% or 5% of all the data you have, which is where most of the gold is. The rest is just junk especially in hotels.
Jon: Actually just to clarify, Les went to say that you want to use the data that you have in your system to post questions to your guest. So you’re actually getting feedback from them. For example you might have a theory. Your theory is that the outbound customers are going to have different needs than an inbound customer. You could use that data, that theory, and send a question or the insight, and you send that question out to the guests and say “Hey look, we were thinking about doing this. How does that sound to you?” Then you get this flood of feedback from your guests saying “Oh my God, thank you. Finally, somebody noticed that my needs are different when I’m on an outbound flight than when I’m on an inbound flight.” I think it’s critical.
You also talk a lot about the economy. I’m sure you know this. I actually saw that in one of your keynotes about the economic downturn and how it would affect the hospitality industry. Some people theorized that the 2008 recession and forward was the worst at the hotel industry has ever seen. Since then, the last 5 years or so, we’ve seen month over month increases in ADR, RevPAR, and occupancy. It’s the key performance indicators that hotels look for to gauge their success. That’s not going to happen forever. It’s very cyclical. It happens throughout. Where do you see the economy going in and how can hoteliers better prepare themselves for the next downturn that’d going to happen eventually?
Patrick: Let’s look at two facts which are really interesting. First of all, we’ve got massive overcapacity in hotels in most parts of the world. Let’s just take Europe. Every time a new hotel is built, another one has to be pulled down, period. The amount of demand for additional hotel rooms is some but is not dramatic. It depends the way you are in the world. But I’m talking about total number of hotels in developed markets like the US or Western Europe and so on. We need to be pretty careful about this. It’s the same with retail. Every time a new shopping mall opens, some other retail space is going to come under pressure somewhere. There’s got to be a big shakeout. We have too much capacity. That’s the first thing.
The second thing is that many people predicted the death of business travel, or the decline in business travel. They said maybe 10 or 15 years ago that we’d all stop traveling. We’d be using Skype and things like that all the time. Virtual teams would mean that we wouldn’t need to travel. To me that was clearly nonsense at the time and it’s certainly proven to be nonsense. Business travel on the hall in most sectors has increased every single year … it’s certainly continuing strongly right now. It’s growing especially fast obviously when we’re looking at that let’s say the Chinese business traveler traveling outside China. It’s less though for more a more mature market like the American travelers traveling within the US. Okay fine. That’s a mature market. It’s one that is overdeveloped and so on.
The fact is that there still is tremendously deep human need to breathe the same air. Virtual teams have proven very, very good at getting jobs done but absolutely useless in building trust. Business is all about trust. It’s about reputation. It’s about reducing risk. It’s about belief in the person they’re dealing with. It’s about liking the person. We’re back to emotion again. This is going to be powerful engine for business. That means breathing the same air especially when we’re talking about working across cultures. If you’re going to try and develop a new relationship let’s say in Vietnam and you live in Miami, you can try and do it over the phone if you want. You just lose out on the competitors because the competitors will be out there. They will be actually shaking the hands and they will be meeting members of the family and they’ll be saying your children are lovely and isn’t your granddaughter beautiful? And let’s play some golf together and let’s go to the theater. And they’ll be building trust.
The other stuff can be done over video conference later. This trust stuff is unmistakable, unavoidable. Because globalization is continuing to accelerate, the number of business meetings has increased exponentially, international business meetings for executives. While the videoconference meetings have grown dramatically and teleconferences have grown dramatically, and while virtual team working is growing dramatically, it is not enough to stop the growth of face-to-face business meetings. Some of that growth has been taken away. The growth would have been faster without all of these technologies. But business travel will continue to grow. Yes it will be more soulful, it will be better organized, had to be more efficient, people will be expected to work throughout their travel experience to reduce the downtime and so on. But it’s going to continue to grow. That’s very important.
That doesn’t answer your question about the global economy. All I’d say there is one very obvious fact that we are in one tremendously long period of flat or declining growth on the edge of deflation a lot of parts of the world and so on. It is obvious that when you pump in gigantic stimulus of various kinds and still see nothing happen for a long time. Eventually it is likely this season will pass and be replaced by one of our longest booms that we’ve ever seen. Of course that might be interrupted by yet another shock. If it is, that’d be an even bigger stimulus and even more economic chaos, which will make it even more likely that when it does come, that rebound will come with a tremendous force and power and strength. We can expect after that a further crash. It is impossible to conceive that we’ll ever go after this enormous slump back to perfect tranquility and microscopic cycles, which is almost imperceptible. It’s going up and down. It’s so stable. It’s not true. For two decades we hardly see a flicker. We are bound to see really long big cycles, which I think that the effects of which will be felt for 20 to 30 years.
Jon: That’s a great answer. With the hotel industry, what they found especially in the 2000’s what was happening and it was even having on the consumer level with home prices and whatnot is that people were overleveraging. It was like the heyday. They had this kind of a trance thing where they just expected revenues to continue on the upward trend or upward tick. What happened is they overleveraged then the economy dropped, they lost value. A $4-million hotel was now valued at $3.2 million. Then the bank started calling those notes in. Some of the advice that I’ve received from a lot of hoteliers is that you can’t over leverage. You have to plan for the worst but hope for the best. You have to make more wise decisions. If your revenues drop by 30%, how long can you sustain that?
Patrick: That’s unfortunate to travel industries. They’re always one of the first places to be hit. They could be hit for all kinds of strange reasons that are completely beyond the hotel’s control. It might be some regional conflict or it’s a volcano over Iceland, which suddenly paralyzes air space over Europe for a while. It can be the 2-3 planes of a particular model will dropout the sky together for some reason then there’s a whole lot of planes grounded. It could be two terrorist attacks on the tourist beach which wipes out confidence in a particular country’s tourist industry for several years.
There are many things. It’s not just the big economic cycles that these hotels need to worry about. There are many things which come crashing in for them. That means they have to be very agile. As you said, they have to manage their cash flow very well. They need to make sure that they’ve got sufficient reserves whether it’s some kind of a downturn. They thought these things through so they know in advance how they would restructure the staffing of the hotel over a 6-week period if they suddenly found that they had a full knock by 70-80%.
I think it’s difficult for hotels especially I would say in territories where a strange thing is going on like Tunisia or Libya or Egypt. People come in off a long way away from the trouble, even Greece. My wife and I flew out to Greece on the very day that we were told in the news that there are not going to be any petrol. People were hoarding food, that the ATM machines didn’t work, banks were closed. In fact, it was all completely normal. It’s easy for the travel industry and the hospitality industry to be severely damaged by rumor innuendo just worry about those so that neurotic visitors, customers and guests who read too many newspapers and watch too much CNN.
Jon: I actually have some friends that own hotels in the Gulf. The BP oil spill in the news have really damaged revenues for a much more extended period of time than it had to because they didn’t know any better. They saw everything on the news. They just assumed that the beaches would be tarnished and polluted. They fought that, the public perception for a long time to get people to start traveling back in there.
Patrick: My message to anyone listening to this podcast is this – when it comes to travel and hospitality, don’t believe what you read in the media. Social media is much more reliable. Go in the comment blog. Find out from guests who stayed at the hotel last week and find the hotel is still open, there’s still food on the table and everyone is very happy and no one knows what all of the fuss is about. Actually if you do that, you will have the most amazing time because you’ll find hotel rooms at half the usual price. You’ll find yourself in near empty planes. The staff is just so overwhelmingly grateful to see you that you’ve believed in them and you still come despite all the shenanigans that they’ve read about.
Jon: That’s great. We’ve gone long here so I don’t want to keep you too long. But I do want to ask you, if you could share a defining moment in your career. Just take a moment. Take us there and really tell us what it felt like.
Patrick: It’s a strange one. I would go back to my medical days actually, when I was caring for people dying of cancer and I’m still involved in medicine through an AIDS foundation which my wife and I started 27 years ago. That foundation is now in places called asset, and it’s in places like Uganda, Nigeria, Thailand, India, Russia, Belarus, looking to save lives of an HIV and care for people who are affected. My mutual work was cancer, looking after people dying at home. I learned one incredibly important truth which has lasted me forever. It’s this: Life is too short. Life is short. Life’s too short to do things you don’t believe in. Life’s too short to spend a single day doing things you don’t believe in. The importance of seizing the day, of making the difference, of treasuring the opportunity, I think this is absolutely vital especially in hospitality and hotels and travel industry to make every day special. Make it really matter. Make it count. It’s really important and it will never come again.
Jon: What a beautiful answer! Thank you. What’s the best way for our listeners to find you online?
Patrick: Globalchange.com is my website. It’s had 50 million visitors. I’ve had 5.5 million video views. Globalchange.com is where I put all my presentations. There are 650 videos there. On globalchange.com, you’ll find a text of the six entire books. My latest book, if I can mention it, is out this week and it’s called the Future of Almost Everything because I couldn’t get everything in one book. It’s a load of fun to write. I hope you’ll find it a load of fun to read.
Jon: Do you want to talk a little bit more about that?
Patrick: Okay, well the Future of Almost Everything basically is a summary of every single message that I’ve been talking about with every single industry, boards, and senior teams in every country, every territory, every sector throughout the world over the last 3 years. It’s been an exciting journey, a journey that takes me into 2040, 2050 and write out the 2100. It takes me into every sector of life every dimension of human existence and to every technology and every innovations – all in one book. The truth is about the future that every trend connects to everything else. Your life is connected intimately to 7 billion other people’s lives because we’re in this hyper connected world, we’re all on the same planet. It’s how these trends mesh together that creates the future. That’s what’s so fascinating about the Future of Almost Everything.
Jon: That’s fantastic. They can buy on Amazon?
Patrick: They could buy it on Amazon.
Jon: Fantastic. Well I’ll link to that in the show notes so people can easily find that for you as well.
Patrick: Thank you.
Jon: Patrick, I really appreciate your time today. You’re so engaging. I encourage any of the listeners to look you up. You’re going to find hundreds of videos online. I saw you doing lots of impromptu. It’s almost like you had an iPhone there on some of these little videos. You were talking at a trade show. You’re just so engaging every time you speak and you have so much wisdom and so much to offer. I really appreciate you taking an hour out of your time today to share with the listeners.
Patrick: I appreciate it. It’s been fun. Thank you.
Thanks for Listening!
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