On the surface, The Flamingo resort in Fort Lauderdale, Fla., doesn’t meet a lot of the criteria that would indicate its potential as a successful wireless hotspot. The venerable luxury Bed & Breakfast only has 25 rooms. Its business has always been predicated on the getaway weekend traveler. The Flamingo is all about a relaxing setting and a restful experience. However, a deeper look reveals the Flamingo to be a prime target for a wireless hotspot.
Researching the Location
Bryan Kidd, the CEO of Anywhere Internet, began providing network support services to the B&B almost a year ago. Kidd founded his company to vend services of several types to the luxury hotel niche. He was initially hesitant to approach the business as a hotspot despite that fact that such public access wireless LANs (WLANs) were a very exciting new business for his firm. However, Bryan found the fundamental appeal of the Flamingo as a hotspot to be too compelling to wait.
The Flamingo caters to a very luxury crowd. Its suites run from $189 per night up to $300 per night, indicating that its clientele are successful and often wealthy. Many of them are business owners and executives seeking that prized getaway weekend.
Also the Flamingo is a historic building and the owners are very sensitive about any kind of wall penetrations.
“As we found when we began deployment, drilling a bunch of holes would not have been tolerated by the owners,” says Kidd. “The Flamingo strongly emphasized that its guests not be disturbed by a noisy install.”
Anecdotal conversations with the reservation staff revealed that up to thirty percent of guests inquire about the availability of a broadband connection. Additionally, Kidd determined that many guests say that they would consider extending their stays if they could access their offices and customers more easily. Kidd found that on Thursday through Monday the B&B stays packed. However, the location experiences a drop-off in business midweek.
“The Tuesday, Wednesday business lull was just amazing,” Kidd says.
Kidd saw opportunity for the venue and his company. Despite this the Flamingo was uncertain about the change.
The Flamingo Resort prides itself on being a very high-service, old-world style luxury escape. This mindset comes directly from its very conservative owners, according to Kidd.
“We struggled at times just to get the Flamingo to consider upgrading its computers to speed reservations,” he says. “A hotspot seemed out of the question until we hit upon the proper approach.”
Kidd says that the continuity of service provided by his company served to build the trust level that got the owners of the venue to listen. Yet despite this existing customer relationship it was no sure deal.
He first had to educate the B&B on the services that upgraded computers could provide to its guests. The Flamingo basically understood that it would improve productivity for its staff and reduce costs. However, the opportunity to improve the quality of its guests’ stays was the deciding factor in adding hotspots to the equation–that and the notion of increasing the length of those stays.
“We explained that we thought that the midweek drop-off was due to business travelers having to get back to the office in order to do business,” says Kidd. “The Flamingo agreed with us but only when we suggested that a wireless service could encourage an additional day or two stay did the value of hotspot service really hit them.”
Kidd briefly ran through the economics of just one extra guest stay per week. At that point, the Flamingo finally got it. Still there were concerns.
The Right Technology
The choice of wireless ended up being the only choice for bringing broadband to the B&B. The owners were extremely sensitive about damage to the building and were absolutely adamant that the equipment not be a distraction. A wireline solution would have never worked.
Kidd chose to use Colubris gear and the Airpath network for its simplicity and interoperability. The design of the venue lent itself well to wireless and ultimately only a single access point with a 8.5dbi patch antenna was necessary to reach all of the rooms and common areas.
Kidd chose to own this equipment to reduce any perceived barriers to entry. There was no charge to the location for the installation except for the broadband DSL connection and a few wireless PC cards to keep on hand.
Ultimately, Anywhere Internet needed to drill only one hole — into an equipment closet — though even that prompted some hand wringing from the hotel. Installation took only a couple of hours, most of which was spent familiarizing staff with the new service. Once installed, the service lit up immediately. The first customer was waiting in the lobby.
Hotel employees have been thrilled. They now have high-speed service. More importantly, so do the customers.
Where’s the Profit?
Kidd reports that his chosen sales approach of linking the cost of the service to the more traditional advertising expense model bore fruit. The hotel is content and, for the most part, he is, too.
“We average approximately 15-25 customers per month,” says Kidd. “The location consistently generates several hundred plus dollars of positive cash flow each month.”
By most standards this is a successful hotspot. However, Kidd reports that some different choices might have been better.
“We chose not to pitch a revenue share to the hotel to simplify the message,” says Kidd. “In retrospect I believe it would have been better to involve them in helping push the service from the beginning.”
Anywhere Internet relies on point of sale signage to generate customer interest and some employee suggestive selling. He has noticed consistent roaming traffic to the location from out of town travelers.
“One local gentleman chose the Flamingo to stay for two weeks at $300 per night while his kitchen was being remodeled because it had wireless high-speed access,” says Kidd. “Once the hotel found this out I could not have convinced them to remove it for any reason.”
Kidd added that a regular guest from the United Kingdom mentioned that a local hotspot of his recently was lit on the Airpath network so this gentleman bought a three-month access plan that he can use at home and away.
Duplicating the Process
Anywhere Internet is busily approaching other hospitality locations in the Fort Lauderdale area. Kidd says that the hardest task is to educate potential customers with a simple enough approach to not make them afraid.
“It’s important to distill the concept to terms customers will understand,” he adds.
Kidd recently added a second location in the Boston area leveraged from a networking contact. This location followed his consistent model of following the wealthy (not necessarily business) customer. This location follows a different business model but matches his target demographic.
Many assail the hotspot business model as suspect. Certainly venues that are deployed without planning and some understanding of the location’s business needs can be vulnerable to failure. Kidd chose to deploy within a market he knew well. The primary lesson here is that WISPs can find gold in all sorts of places if they are willing to invest some research in the fundamental fitness of the location for the service.
Tim Sanders is founder of The Final Mile, a fixed wireless consulting group. His experience was gained running a multi-state fixed wireless ISP. He can be reached at www.thefinalmile.net or [email protected].