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Why Your Hotel Doesn’t Need a Mobile App

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Posted by Alex Gaggioli
September 21, 2015

It’s 2015 and mobile applications are nothing new. Many companies, travel related or not, have seen tremendous success in the mobile app space. However, mobile apps are expensive to create and often require a lot of time and maintenance. Many independent hotels or even hostels have contemplated creating an app. It’s easy to become distracted by the “cool” and “wow” factors of mobile apps, but this doesn’t mean they are good for your business. In fact, mobile apps are a huge waste of money for most hoteliers.

I write this post from personal experience. I worked for a mobile app startup company whose  foundation was built upon the idea that hotel mobile apps suffer from a few problems:

  • They are expensive (true)
  • User adoption rates are low and extremely difficult to increase (also true)
  • They are time consuming and don’t offer much value to guests (also also true)

The company’s goal was to create a single platform where hotel brands could co-exist. The idea was that a consumer would only have to download one app in order to access hundreds of properties. Right now, many hotel brands and a lot of their sub-brands have individual apps. And even still, many individual properties have their own app. That’s a lot of apps hotels hope for you to download.

Even with a single platform, there is a major barrier between the hotel and consumer. No one wants to download an app for a short-term purpose.

Mobile-App-Blog-

On the surface, mobile apps sound like a great idea. Hoteliers and property managers want to connect with their guests and offer them value, in and out of the hotel. Mobile apps have the perceived opportunity to help hotels better communicate with their guests. But, what you find is hundreds if not thousands of proprietary apps (think Hilton, Marriott, etc.) in the Apple Store and Google Play that are hardly used. Getting a guest to simply download the app is one large feat. Getting them to use it is another.

The average hotel stay is 2-3 nights (source) and in that time you have to convince a guest to download an app and then incentivize them to use it. In general, mobile apps are used out of habitual nature, like messages, Instagram, or Yelp. But, many mobile users do not habitually use hotel apps.

There is no doubt we live in a mobile world. 75% of U.S. travelers own a smartphone. This number is increasing every day, according to Phocuswright. 80% of all mobile travel bookings are for hotel stays (source), which plays to an important trend.Consumers are spending more time on researching and booking travel on mobile than ever before. But, the most viable solution is not always a mobile app. Hotels have options when it comes to mobile strategy such as a mobile-optimized website. (Cloudbeds published a post on mobile strategy for hotels; see it here). Previously, a mobile app was the pinnacle goal of any mobile marketing strategy. Mobile optimized websites came in second. But, it seems as if mobile apps aren’t worth the time, money and effort for individual properties.

Techcrunch reported on a Nielsen study that said there appears to be an upper-limit to the amount of apps a consumer uses. Typical smartphone users will use 25-27 mobile apps a month and a majority of their time will be spent on only five apps. The majority of users’ time is spent on entertainment apps such as gaming, music, or sports. The Nielsen study shows that the competition for attention  is intense among developers.

Localytics reported in 2014 that the amount of apps that were only opened once decreased and that the amount of apps opened more than 11 times increased. While that is good news for app developers, there are still a lot of apps that go unused. As the graph below shows, the number of times that an app is opened 2-10 times accounts for 49% all apps.

Localytics Mobile App Usage Graph

According to Digital Trends, only 16% of users will open an app more than twice. Anywhere from 80-90% of users will delete an app after only one use. Numbers don’t lie and it is very hard to impress a user and keep them coming back for more.  

HotelTonight and Hipmunk continue rise in popularity. However, Google’s 2014 travel study concluded that search engines remain significantly more popular than apps as a way to start travel planning and booking, as summed up by Tnooz.

Additionally, the types of travel apps that are popular on mobile devices are very different from hotel apps. They tend to be OTAs, or tools used to get cheap accommodations at the last minute, or to find accommodation deals. They are rarely hotel apps. In fact, the hotel apps that do exist on the Apple app store for big hotel chains, like Hyatt and Marriott, get zero visibility in the travel section of the store. As of this writing, none of the top 30 results in the “Travel…Hotel Bookings” belonged to hotels.

Tnooz notes that the declining app usage is surprising as we are coming out of an app-happy phase. In general, people love apps, but that doesn’t mean people love using travel apps, such as individual property apps. Consumers are enticed to utilize other research and booking methods. What the study doesn’t tell us is whether or not people are booking on hotel mobile apps or OTA mobile apps.

Unless you own or manage a large hotel brand, such as a Marriott or Hilton, I can’t imagine that a guests would book their stay on your app, especially first time guests. It is hard enough for hotel brands to receive direct bookings, and mobile bookings are even more difficult to obtain.

While staying ahead of trends and being a mobile trailblazer are commended (especially by a hospitality tech company), not every solution works for every property type. It’s commendable to stay one step ahead of technology trends and to be a mobile trailblazer. (After all Cloudbeds is a hospitality tech company, and we love all things techie!) However, not all tech solutions work for all properties. Mobile apps are one of the failures for most properties–even the big guys. It may be new and shiny, but mobile apps do not give a return on investment for most properties.

Mobile apps can cost anywhere from $30,000 – $450,000 based on functionality and individual needs (source). Even the most basic apps come with a high price tag and a lot of maintenance.

For a small or independent hotelier, focus on your website. Get it mobile optimized, and install a mobile optimized booking engine. This is the best way for you to appear on Google Mobile, and for you to accept direct bookings from guests using mobile devices. Ignore apps.

For a list of hotel mobile options, be sure to read a previous post outlining all the mobile app alternatives.