LodgeNet wisely announced a wholesale rebrand last year at HITEC, shedding the skin of a former life that saw the company miss the boat on consumer content consumption shifts. The company now goes by the name SONIFI Solutions, and claims the slogan "content and connectivity" as its guiding light towards providing property-wide connected solutions.
In the effort to forget the past and focus on the future, the company has released an new iteration of its once-standard in-room entertainment software, STAY1000, that includes useful innovations such as a mobile remote that pairs a smartphone with a TV.
These sorts of updated products are an essential part of the company's new strategy, and are highlighted by its effort to push past its former self and into a broad connectivity solution that allows guests to consume content in any way they choose. Companies such as Quadriga, Intelity, Allin Interactive and many more are offering entertainment solutions for hospitality, so the market is only heating up.
Tnooz sat with SONIFI CEO Mike Ribero to chat candidly about how his company is moving from the past into a highly competitive present.
Let's talk a bit about the previous iteration of your company. The world left you behind a little bit there...
A little bit? I think that's a bit of an understatement! It's been a year since we rebranded, and the rebranding was about leaving the old company behind, lock stock and barrel. We knew we had to make serious changes to reestablish ourselves in the market, and not be seen as yesterday's news. And yesterday may be too kind - last year's news.
What we've been focusing on is the three I's: investment, in the company, talent, technology, process, and systems; innovation, as we didn't do much of it before when the company basically stopped at creating VOD across the industry without addressing the internet; and the third I is improving our internal processes so we could be more hotel centric.
It's hard for me to believe that this company was in business for almost 30 years and never once did they think it was a good idea to have someone with hotel experience making the decisions. Our focus has been re-establishing the relationship we had with the brands that we had worked with for a really long time.
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LodgeNet was rebranded as SONIFI Solutions last year.[/caption]
Since rebranding, how has the company been performing on the hotel customer side?
We've now participated in 6 RFPs/RFIs, and I'm proud to say that we've won every single one. Three that we can talk about: Hilton, Red Roof Inn and most recently Kimpton Hotels. We're going to be talking about 3 more in the very near future. We haven't lost a single competition so to speak that we've been involved with. I think that's reflective of the fact that we haven't tried to run away from our past, which was less than stellar, and tried to commit ourselves to understanding what our customers need - and then helping them understand what their customers need, so we can deploy technology not just for tech's sake but to help our hotels provide a solution that maximizes guest satisfaction without breaking the bank.
Unfortunately the hospitality industry has a history of deploying systems that start out as profit centers and then turn into cost centers - and we want to help them avoid that in the future. For example, WiFi has become a significant cost center. We believe in giving the guest a level of free broadband for their everyday tasks, but if they want to stream content in HD on a big TV, then maybe they pay a bit extra for that.
It's all about understanding what drives our customers and in turn what is driving them by virtue of what the traveler needs, and then create solutions that are both highly utilitarian and cost-effective.
Talk about re-connecting with the traveling customer after LodgeNet became such a pain-point in the in-room experience.
It wasn't just people staying in a hotel -whenever LodgeNet came up in a meeting, it would almost deflate people's interest in the meeting. The challenege for us is, as the largest supplier of contnet and connectivity in hospitality, we have almost 1.4 million guest rooms. So effecting a change overnight when you're talking about the magnititude and cost to upgrade all of those systems has been a challange. When we deploy new technologies, we still have to live with some of the technology that's been deployed for many years. We're trying to make it easier for hotels to upgrade their way out of the old systems, but this is a business where you're only as strong as you're weakest link. And this company had a lot of weak links.
I'm happy to say that we've made a significant amount of progress. What drove a lot of that feeling about the company was that the company presented no future, the company didn't give anyone anything to look forward to. We now have a lot for our customers to look forward to, everything form better leveraging the infrastructure and technology they have today to new technology that brings mobile devices into the mix and give the guest more of what they want, when, where and how they want it.
Did the lost direction of LodgeNet leave a hole for large brands such as Samsung to come in, or was it inevitable that this large players would offer an end-to-end content/connectivity solution for hotels?
The reality of it is that Samsung and LG are still incredibly dependent on us. More importantly, the hotels are dependent on us. When you're a bigger player, you tend to want the hotel industry to commit to your solution end-to-end, when in reality you may only have a piece of the value chain where you have the pre-eminent solution but requires a combination of vendors to come together.
The industry needs someone who can integrate that technology in a way that's best for them. We have no allegiance to any large player outside of strategic relationships, and our singular mission is to provide the best solutions to our customers regardless of what components that may comprise. There's not a single source major supplier that can provide the end-to-end needs of a hotel across their entire content and connectivity ecosystem - it's just too diverse for any single company to provide everything a hotel needs.
Hospitality entertainment is a global business, and one that is quickly affected by changing consumer consumption habits. How are you approaching these challenges as a new company?
It's the localization that's required globally in an area that's vertically niched - while its the same user in hospitality entertainment, it requires a different offering than what you see residentially. It's really one of the most unique viewing environments - but it's the most compressed, as viewing occasions might be only 15-20 minutes.
At home, you have the luxury of time, which means we have to make a solution that's incredibly efficient that allows you as a guest to get to what you want to watch quicker. And to spend the bulk of your time watching, as opposed to configuring, searching, trying to find...so by the time you've curated you're own content, you don't have the time to watch it. And that's one of the challenges that we have: presenting content in such an intuitive way that you spend the bulk of your time watching what you're interested in as opposed to searching for something to watch and then not having the time to watch it.
You've spoken about what the customer needs, and what the hotel needs. Talk about the innovation lab you recently announced in Menlo Park in the frame of the mistakes made as LodgeNet. Is this a play to make sure that getting left behind never happens again, and if so, how are you taking these lessons and moving forward with them?
The lab is a piece of it, it's the practical, the application side. It's essential a sandbox where we can play with our customers on a very strategic basis to try new things, to try new technologies, apply them to see how they work, see how the guest reacts to them. This has to happen in tandem with primary and secondary consumer research, to try to get a better understanding of what the guests really want and to reconcile those needs against what the industry perceives that the guest wants.
We just finished some research that will be available soon that clearly shows a gap between what the industry thinks the guests want and what the guests actually want. And we were frankly surprised how guests ranked the various extended functionalities available, and how much impact it can have on hotel choice.
We simply cannot afford to fall behind from an innovation perspective but we can't innovate for the sake of innovation. We have to innovate relevantly and with partnership with our hotel partners, because what they want is to be able to leverage our systems competitively.
Historically, not only did the company make a mistake by being a one-trick pony, it forced a level of homogeneity on the industry that didn't really allow them to innovate using guest entertainment.
What is the meaning of hospitality entertainment is this world of content everywhere, always-on connectivity?
I won't tell you which one, a major hotel brand CEO said to me, "I want SONIFI to create the type of solution that could become my Heavenly Bed. I want to be able to use guest entertainment competitively to the point where it becomes my distinguishing feature." And that's the challenge we have to undertake, in a way that we can offer everything to everybody, but do it in a way where if hotels work with us to drive the innovation, we have ot be able to facilitate that differentiation for a period of time.
That's going to require a level of customization that we're now introducing, and a level of personalization for the guest, that allows the experience to be not only relevant but really efficient so you're not going through content you're not interested in as a traveler.
We've been so dependent on the feature film and the adult business to drive this technology, but the amount of people who have time to commit to a movie while traveling don't have the time to commit to a full-length feature film. Now we're able to work with folks like ESPN to re-broadcast every single World Cup game 10 hours after its played for 99 cents. So guests can watch it in HD for 99 cents rather than their phone, and that's a good deal for the guest, that's a good deal for us, and a good deal for hotels.
Same thing with some of the self-improvement content with Deepak Chopra: smaller bits of content to consume at a price that makes it easy to consumer. It's more about what we can offer at the right time and the right place - it may be here in the public area of the hotel. It may be on the tablet while at a conference and you want to catch up on Game of Thrones.
Guests can do that all over the property - when, where and how they want it. That's the ultimate goal.
NB: Remote control image courtesy Shutterstock.