Is this really the future of Alpine tourism?
Reto Gurtner on the future of the Swiss Alps
From connecting all services to working in the clouds
Did you know that the first internet cafe in Europe was not in London, but in the heart of the Swiss Alps, in a then little-known place called Laax? It was 1998, and the dial-in web server was located in New York, so the costs were as high as the altitude.
Nonetheless, Reto Gurtner believed in the power of the internet and pursued the idea. Such is the nature of vision and passion. As Weisse Arena Gruppe’s (WAG) CEO, he has always been one to push the boundaries with a great sense of intuition for the future.
As a tourism provider that brings in around CHF80million annual revenue, WAG has brought Laax onto the global stage with a complete digital transformation, connecting the service providers of the resort directly with its customers, on a central digital platform called InsideLAAX.
We caught up with Gurtner to find out why this move was necessary for a Swiss ski resort like Laax.
Why is digital transformation important for a Swiss ski resort?
We all know about climate change – for mountain tourism it’s impact is a reality we must prepare for, as the annual amount of snowfall in the Swiss Alps is expected to decrease by up to 28 per cent by 2050, and only occurring at altitudes above 1.500 meters, which shortens snow seasons by two to four weeks.
To offset that, we are expanding our value offerings but better understanding our customers and creating a much more fulfilling customer experience for them that they will want to come back for the year-round experience. Our strategy is to give our customers the best (but not necessarily the cheapest) and create an emotional experience.
So, digitalization is the tool to give us the information and is key to the process of getting closer to our customers. Our view is that if we want to provide a higher quality customer experience, reduce hassle and streamline the offered experience, everything that can be digitalised should be digitalised.
Everything that can be turned into something conveying data and everything measurable should be digitalised. If this is done, information is available just-in-time and it is possible to act based on as timely and accurate information as possible.
In tourism it is typically difficult to tie together meaningful customer data because there are many independents such as separate ski schools, restaurants, hotels, equipment rentals. Laax is able to do it because we are centrally coordinated and we are able to create a unified customer experience unlike may other resorts.
The transformation part is an ongoing process – we didn’t just jump into our evolution, as it’s always been part of our DNA. But the process of getting everyone to shift their mindset towards being more data-analysis minded and forward looking is not easy.
Digitization goes beyond a website and online booking portal. Can you tell us how data has transformed how Laax operates?
Our aim is to create a community with transparency and trust: many people are concerned about how their data is used and we want this to be fully transparent to them. We want to give power to the customer so they can look after their own data.
WAG collects data, for example of gate entries, parking space vacancy, on-mountain customer quantities, daily revenue, and web sales. These data are presented in near real-time dashboards that are available for various parts of the organisation, that helps us ensure resources are directed to the best place at the right time to enhance customer experience.
We know that our customers are on average around 45 years old, a lower average than in many other resorts. We can assume that they are digitally savvy and comfortable with us using data that will enhance their experience.
We’ve created a great website and booking system interface, and look to integrate more technology features that will improve the customer experiences, such as voice command (as users may want to buy tickets or book parking, reserve a table at a restaurant whilst driving to Laax). All new features and initiatives follow the guidelines:
- Digital First
- Mobile First
- Local First
Secondly: Precise forecasting so that we can understand how to best optimize the mountain facilities depending on a given day’s demand, based on weather, time of year, what else is happening at a given time. Ultimately, this will enable more automation, so that we can focus on more human tasks.
Finally, what to do with all the data? All collected data is useless unless it can be analysed, combined and understood to ultimately guide and aid decision making.
Data analytics is when the brain work is – it’s layering your smart data over your KPIs. We need quantitative analysis to take granulated data and look at correlations. We have set this up to be integrated into the backbone of the system.
What have been the most challenging tasks of implementing digital change?
How do you change a mindset it is a challenge to be forward-thinking? It takes time to educate people and to ignite the passion. It’s up to the leader to carry the fire, not the ash, and that is the most time-consuming.
2. Technical feasibility
The technical work has not been done according to a clear-cut master plan. Instead the premise has been to act in an agile manner, being able to test ideas quickly in a tangible way and being able to steer into a new direction when required.
3. Producing ROI – value, profitable business model.
Investment in digital transformation is definitely a long term investment, but a necessary one. It may take a bit of experimenting and unexpected costs in the beginning to get the right mix. For us, it was moving the digital team inhouse to create our spinoff Inside Labs, so we can deliver an experience that is 100% focussed on the LAAX customer. From what they have developed and learnt from the LAAX digitization, they can now adapt and scale this for other businesses.
How do you feel this digital transformation has positioned you for the next 10 years? How do you see WAG evolving from here?
We have been one of the most successful cases of digital transformation in Switzerland. We are positioning ourselves as a year round destination with a co-working space for a customer segment that combines work with leisure.
We’re also looking at internet of things. Data from connected skis and equipment and will give us a richer picture of the patterns and consumption of our international clientele, who tend to rent their equipment.
With rich data, we can build unlimited clusters of customers data, and the buyer is in control of their data. We are starting experiment with cryptocurrency and blockchain so that all the independents can be unified on a a common ledger and trade on equal terms. This creates trust and eliminates bureaucracy. Bureaucracy = no productivity.
Finally, big changes are coming from Asia – which is set to grow from less than 2% snowsports penetration to over 20% after the 2022 Winter Olympics in Beijing. We’re looking at WeChat and using it for social media to Chinese audience going out to the snowboard community.
It’s an exciting time, and we look forward to sharing what we’ve achieved with the speakers and CEOs that will join us in Laax for WORLDWEBFORUM’s Pre-Unconference on the 13-16th January, 2019.