This article was originally posted In RE Advisor, Issue II February 2017.
For 2020, the number of mobile users worldwide is forecast to grow to 7.26 billion, according to Pew Research, and now cell phones outnumber the world’s population Businesses, particularly public retail spaces such as malls and shopping center, need to answer the demand for connectivity in their spaces to attract and retain visitors. Wi-Fi connectivity in physical spaces is the necessary conduit to provide the demand. Visitors to commercial spaces look for Wi-Fi not just due to a lack of signal from inside a large building, for example, but also for speed and data usage concerns. It is not surprising that Wi-Fi is the most requested guest amenity because people expect connectivity almost as a right. Connectivity has become as necessary an amenity as a bathroom or a parking space, reflecting directly on the overall quality of experience in your space for visitors.
Since Wi-Fi and connectivity are absolutely necessary, how should a company investing in this technology measure its return on investment? Companies find that rolling out Wi-Fi to a network of physical locations may be the most complex and expensive project an IT department will tackle. Too many companies set out without a clear business case for Wi-Fi and are uncertain how the company will measure its return on investment as well as the ongoing costs such as helpdesk personnel, annual licensing fees, and Wi-Fi marketing customer acquisition efforts. The business use case should be to promote their corporate marketing objectives, gain valuable insights on the behaviors, enhance customer experience, and create relationships rather than just check off a box in the list of amenities a commercial space provides.
Commercial landlords may say, “Why not let the retailers or tenants install Wi-Fi”? On the surface it seems easier and more cost efficient for the tenants to do their own leasehold improvements, however this thought process fails to see how these improvements build valuable data assets for the landlord. Owners do have certain goals in common with their tenants such as increasing visitor satisfaction and increasing foot traffic resulting in higher store sales. Wi-Fi connectivity is a channel to help reach those goals. However landlords have two distinct goals separate from their tenants to both increase property values and future lease rental rates. Wi-Fi data can be a huge digital asset if the Wi-Fi experience is treated as a marketing touchpoint rather than a utility. How valuable would it be for owners to tell future tenants, “30% of your foot traffic are millennials that like J Crew”? Or that “a significant portion of your Wi-Fi audience are snapchat users”? It’s these types of matrices that can give a landlord insight into their properties like never before which can make a big difference in being able to manage the property more efficiently and effectively. As a landlord, being able to understand foot traffic patterns, who are the people walking through the property and where are they going, can determine which types of tenants an owner should be accepting in their properties in order to maximize profits.
The first step in building a Wi-Fi experience is selecting the appropriate hardware. When selecting Wi-Fi hardware there is a dizzying array of choices. There are enterprise grade high density solutions which give IT a central dashboard to execute and monitor Wi-Fi connectivity. This is ideal for a multi-location operator that wants to monitor all its locations centrally as well as control the messaging over Wi-Fi to all its properties. Some of the moderately priced models can work in a small shopping center or a single location when analyzing data across many locations is not applicable. However, many of the more economically priced models do not allow for social profile log ons, so if that is a priority for you, which it should be, then those solutions limit a business in terms of growth of its Wi-Fi channel.
A word of caution when considering free hardware offered by third party service providers. This option is usually low grade, low functionality equipment that either requires the end user to pay for access, such as Boingo, or features an ad network that is controlled by the installation company and not by the business. These models have started to fall out of favor due to the poor customer experience and the lack of flexibility for the business owner.
What type of Wi-Fi experience should businesses provide to visitors? The first option is always an open Wi-Fi network, which allows customers to access Wi-Fi by simply selecting the network. It’s the easiest for customers to use, but many people don’t trust open networks due to security issues and there are zero opportunities to interact or build relationships with customers.
A second model is the simple sponsored splash page, which can help commercial venues stay on brand and collect email addresses but doesn’t offer any personalized marketing or a touch point to connect with their visitors.
The third model is the general advertising experience, which is typical when using outsourced hardware. It allows businesses to collect data on visitors, but not control the message as the advertising network belongs to the hardware company. Marketing is not personalized and can be perceived as spammy from end users.
Finally, the most data driven solution, the personalized marketing experience. Statistics show that 10- 20% of visitors will take advantage of the free Wi-Fi marketing experience. Visitors sign in with email or social profiles and are taken to a personalized experience curated by the sponsor of the Wi-Fi. This helps owners stay on brand and it creates an opportunity to connect with visitors at a moment where they are most receptive to interact with you. The system remembers the user by name the next time they visit, building the relationship between owner and guest to enhance the shopping experience. This can be followed by a transactional email to the landlord after the visit as well. These emails provide the information a landlord could use to improve the experience for the visitor as well as the tenant. The most significant return on investment is found using this method.
Wi-Fi may be the most requested guest amenity, but it is also a conduit to the largest addressable audience that a brick and mortar business has, its foot traffic. This audience can be larger than its website traffic or social media presence combined. If done correctly, Wi-Fi onsite marketing can turn a cost center into a revenue generation channel and create a valuable digital asset. The question that businesses need to answer is if the cost to acquire and nurture digital audiences and the value of the corresponding digital assets are worth the cost of installing and maintaining a Wi-Fi.