How Long Will It Be – Before WiFi Is Free?
There is nothing that irritates a hotel guest more than having to pay for Internet service. And herein lies a significant strategic competitive advantage for small luxury hotels.
Go ahead and do a Google Search for “What travelers think about hotel WiFi?” Then read a couple of pages of results and you’ll see how universally despised hotel Internet access fees are. USA Today, CNN, MSNBC, J. D. Powers, Hotels.com, The Daily Mail (and the list goes on) are all reporting on it. And bloggers are being merciless on hotels in their condemnation of Internet charges.
J. D. Powers just released its 2010 North American Hotel Guest Satisfaction Study which shows the number one hotel amenity is wireless Internet access. And WiFi use is on the rise – over three-quarters (77%) of respondents say they access the Internet through a WiFi device – up from just over half (55%) three years ago. And they don’t just want access they want high speed access – reliable quality service.
What I found most interesting in the study is that overall customer satisfaction of hotels that offer free Internet access is more than one full point higher than hotels that charge for it (8.15 vs.7.04).
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In other words, Luxury and Upscale chain hotels – those properties notorious for charging for Internet access – are willing to throw customer satisfaction under the bus to keep this revenue stream. The majority of hotels in other categories offer free WiFi. And now that even McDonald’s offers free WiFi it’s no wonder hotel guests feel it should be free.
In a BBC survey of more than 27,000 adults across 26 countries, close to four in five people believe that access to the Internet is a “fundamental right.” And by charging for Internet access, luxury chain hotels are inhibiting people from enjoying that fundamental right.
It’s easy to count the amount of money a hotel generates as a result of charging for Internet access. But it is more difficult to measure the amount of lost revenue as a result of people not booking because it is not free. Or those choosing to eat at a nearby Starbucks, McDonalds or the local deli because they offer free WiFi.
The other thing that can’t be measured is the damage these charges can do to a hotel’s brand. All you have to do is look though negative comments on TripAdvisor. A quick check of several luxury chain hotels on TripAdvisor turned up the following comments – all made this year.
- “Another disappointment was that WiFi was an additional charge. For this class of hotel, one would expect it to be included.”
- “I would probably prefer a Holiday Inn or equivalent where you can get free wifi, free parking, nice pool, free breakfast, and convenience for $100 OR LESS A NIGHT.”
- “WiFi was expensive and we had to pay for the parking as well. Why don’t they include them in the room price?”
- “All the extras in the hotel are very pricy and WiFi is an extra USD 15 per day.”
- “Also like many have said on here, it’s crazy to charge $15 for WiFi when the room and everything else inside the hotel costs so much.”
Hotel guests clearly despise being charged for Internet access. It’s the number one complaint among 1,815 travelers recently surveyed by Hotels.com – 75% cited this as an issue.
Free WiFi is an emotional issue for a majority of travelers. Expect this issue to intensify as more and more people switch from regular cell phones to smart phones. The more they become used to universal Internet access the more they will resent hotels charging for it.
For small luxury hotel marketing folk the implications are clear -
to increase customer satisfaction you need to provide high quality, in-room Internet access for free.
And when you do you’ll have a very strong competitive advantage over the large, branded, chain luxury hotels. Market this highly charged, emotional issue like crazy while you can. Sooner or later those large competitors will have to offer free Internet service.
How long do you think it will be before all WiFi is free? Share your thoughts – post a comment.
Safe travels – Madigan Pratt
Tags: brand building, customer retention, hospitality marketing, hotel marketing, Internet marketing, marketing small luxury hotels, small luxury hotels
9 Comments to “How Long Will It Be – Before WiFi Is Free?”
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It surely will not be long. WiFi is among the top “must-haves” for travelers today, with so many business travelers working mobilely, and leisure travelers who’d like to check their Facebook page, or personal email accounts. Any hotel who has not made the upgrade to include WiFi in their fees is surely going to drop behind the pack quickly- in this day and age it’s one of the surefire ways to gain loyal customers.
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Another good read, Madigan, thanks for sharing. Perhaps in the future we’ll see free basic internet, but tiered charges based on bandwidth and usage. With travelers downloading movies these days, not only does it take away from the hotel’s movie revenue (not that the hotel keeps much of this anyway, most goes to the provider), but if several do this at a time it can tie up the network. As a traveler I love free internet, but I’m still willing to pay for a high-speed, high quality connection.
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Madigan Pratt says:
Hi Daniel, you raise a valid point. I have seen luxury resorts charge for basic service with s surcharge for premium (high speed) access. Just got back from Scotland where that was the case – basis was $15 and premium was $25. Ouch! I chose basic and it was fine for business/email. (Gamers may be willing to pay for higher speeds.)
Perhaps more realistic prices which reflect cost + reasonable profit would satisfy guest (maybe $3 basic and $5 for high speed). But when so many other hotels offer it as part of the room price, I’m sure those asked to pay a premium will always complain.
There goes the J. D. Powers satisfaction scores as well as the TripAdvisor reviews. What’s more important? Each hotel marketing professional has to decide.
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Interesting. Just returned home from the Caribbean Hotel & Tourism Association’s Small Hotels Retreat in San Juan. The retreat was held at Wyndham’s Rio Mar Beach Resort. On their room key it says, “Want Free Internet Access? Join Wyndham ByRequest.”
They will give you free WiFi if you give them personal information they can use to communicate with you on a regular basis. Food for thought – bribing guests to reveal personal data for marketing purposes.
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With so many low cost retailers and other businesses offering free WiFi, I’m amazed that more luxury hotels don’t offer it. Heck, even lower priced motels are jumping on the bandwagon of free internet. I stayed at a Super8 a few years back, and they had free WiFi. I was amazed when I talked to a businesswoman staying at a very well known luxury hotel chain, and they made her pay for access.
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Great post. I stayed at a boutique hotel in Sonoma which offered free wi-fi, but it was not working, and the manager didn’t have enough smarts to fix it correctly for my whole trip. If it’s going to be free, it should work as well.
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There is nothing that irritates a hotel guest more than having to pay for Internet service.
The Caribbean will be one of the last regions where guests demand free WiFi. Guests in our market want/demand easy access but it does not necessarily have to be free. Our infrastructural challenges and costs of doing business are legitimate and my experience says, it has to be available and reasonably priced but it’s still a revenue stream for now.A free WiFi hotspot in our pool and lounge area has been very appreciated