Jens-Henning Peters Consultant
Everybody has heard about the crypto currency Bitcoin until this stage, but its largest competitor, Ethereum has remained mostly under the radar. Both of those open source digital currencies, and especially Ethereum, are experiencing tremendous growth. Both are also relying on the same technology: Blockchain.
In this paragraph you will have to forgive me if not 100% precise. I am writing as an hotelier, not as an IT specialist: This technology is an open ledger system that records all transactions made with the online currency. It does so simultaneously on many servers worldwide. Therefore transactions become public, traceable and difficult to copy. Of course this technology is still under development, fairly slow and from time to time hacker still manage to attack the system.
While Bitcoin and Ethereum seem similar on the first glimpse, it happens so that the latter has a competitive advantage over its competitor: It is boasting a feature that is called smart contracts.
The potential of smart contracts powered by Blockchain is already haunting establishment bankers at night. Actually banks are debating, whether to develop their own Blockchain models, to incorporate existing ones or to fight them altogether to defend their reason of being. Isn’t that fairly far-fetched you may ask? Well, the banking sector is watching closely, because smart contracts transactions are tracked but also programme themselves. That means money becomes smart and invests and save itself accordingly. But smart contracts go further it also lets you transact stocks, property, etc. freely, cutting out the service providers, namely the banks, notaries and lawyers of this world.
Imagine Ethereum like this: you put your money onto a task, it automatically finds the best deal or service, contracts for it, pays for what is used and even services penalties automatically.
Implications for the hospitality industry ?
Apart from the obvious applications for money or banking transactions, how could other industries profit from this emerging technology? Let’s think wildly about what impact smart contracts or cryptocurrencies per se could have on the hospitality industry:
Hotel Bookings: Imagine you would like to book a trip and instruct your smart digital money to automatically spend itself only on the best deals for a room night at your destination. Smart contracts closed between your currency and tech savvy hotels , could carry all necessary framework such as cancellation policies and fees of the transaction and fulfil themselves automatically.
Smart contract based guest experience: A Swiss Blockchain expert group has recently programmed a hotel reservation system based on Ethereum smart contracts. After only 2 days of programming the software was successfully running: Through a smartphone they were able to reserve & pay a room in ETHER online currency, arrived at the mock room without passing a check-in at reception and could open the correct room directly at the correct date with their smartphone. They proved that such solutions are fairly easily programmable already at this stage.
Casinos: By the use of public smart contracts, Casinos can prove their fair functionality and therefore attract clients.
Transportation: Imagine platforms that allow for transactions of singular tickets for the customer to move from one point to another (smart contract). Price transparency would be guaranteed, client’s money would choose automatically from the most convenient and cheapest solution at the given time, trust of clients and user experience improved. Providers could of course executive liberal revenue management, sell B2B and B2C automatically and be assured to receive payment for their services at the contractually agreed rates.
Of course this is all “Zukunftsmusik” as the technology is still in its infancy and there are still many backlashes. Also do we need to ask ourselves the questions if corporations are willing to accept (currently) highly volatile online currencies in place of trusted local currencies.
Certainly we will see an open source technology emerging in the coming years, that many developers will build solutions for. Maybe this will offer hoteliers and other hospitality players a chance to re-invent the way they interact with their clients. On the other hand, if the hoteliers shall sleep, external, more tech-savvy players will certainly enter the market and find their place in our industry based on this new technology.
Jens-Henning Peters Consultant
Jens-Henning’s role at LHC involves the development of learning centres around the world, advisory for the hospitality and service industry, as well as the creation and implementation of new services and products for the company. He has joined LHC in 2015.
Next to a Bachelor Degree in International Hospitality Management from the Ecole hôtelière de Lausanne (EHL), Jens-Henning also holds a Diploma as Hotelkaufmann (Management Assistant in Hotel and Hospitality) from the German chamber of industry and commerce.
Growing up in a family of restaurateurs, Jens-Henning has worked in various positions for leading hotels, restaurant and catering companies in Germany, Switzerland and Denmark, building a solid understanding of the operations in luxury hospitality organizations.
While studying at EHL and throughout industry internships he has acquired various experience in consulting projects. Bringing his entrepreneurial spirit to work, Jens-Henning has helped clients to reposition their portfolio, developed hotel and F&B concepts and held workshops and courses for various topics. His mother tongue is German, he speaks English fluently and is currently studying for his working proficiency in French.
When not at LHC, he enjoys riding his motorcycle and taking photographs. Jens-Henning is a passionate cook, always trying out new recipes he discovers on his travels.