Industry Going Mobile – But Don’t Forget Data Security

This article is extracted from the official website of the hospitality Financial and technology professionals’ organization. This American organization provides tools for hospitality professionals while creating a network for hoteliers.

We found this article interesting and relevant to the course as it is discussing a subject that everybody is concerned with: the question of data security when making payment with a mobile device.

In the hospitality sector, new mobile solutions are skyrocketing and are transforming all traditional services while providing various benefits for hotels: enhanced customer experience, more efficient processes and optimized revenues. Some of the new mobile solutions that are currently used by hotels are booking application on Smartphones, Check-in, loyalty programs, etc.

REUTERS/Shannon Stapleton

The next phase in the development of mobile technology in the travel sector is the near field communications (NFC) and e-wallets. NFCs are the natural prolongation of the mobile customer experience and encourage the payment of every hotel services via the guest mobile device. Each purchase made by the guest will enable to identify his purchasing preferences and may be used further for loyalty programs.

However, even if the mobile experience is improving, some questions remain on the data privacy aspect. Thus, with the fast development of near field communication (mobile payment), it is crucial that hoteliers take necessary action to ensure data protection.

Surprisingly, mobile payment transactions are more secured than the magnetic cards although as the point of sales can be accessed by hackers (the tourism industry is the first attacked by hackers).

Some solutions have already been tested such as tokenization. It transforms the 16 digit information included in the magnetic card into a « token » which is a set of words, phrases or symbols in order to encrypt the guest sensitive private data. Tokenization prevents consumers for having their transaction information stored in the hotel’s point of sale.

As NFCs are expected to increase substantially in the future, there is a need to set standards for mobile payment in the travel industry for both hoteliers and customers.

Although it represents a big investment to implement the system in tourism structures such as hotels (especially for independent ones), the ROI may be interesting as it will enable to reduce personnel costs and to have a better sales strategy with a direct access to guests’ purchasing preferences. Besides, more and more people use Internet to make purchases (especially tourism products). Indeed, according a Médiamétrie/NetRatings and Fevad study of June 2010, 58% of the French Internet users bought tourism products and from 2002 to 2007, the number of Cyberbuyers in France increased by 261%! (France: Les Cyberconsommateurs, 2010).

Nevertheless, this innovation may take time to be adopted by a majority of guests as people are aware of the risks of hacking. As an example, the recent hacking of the FBI website by the dissenting group: The Anonymous proved to the audience that any data could be hacked easily by competent people. 

Source: English, M. (2012, February 2). Industry going mobile - But don't forget data security.  Retrieved February 6, 2012, from Hospitality Financials and Technology Professionals: http://blog.hftp.org/industry-going-mobile-but-dont-forget-data-security/