The hospitality industry is making a strong rebound after the pandemic, and many hotel chains are now creating new sub-brands targeting a very diverse band of travelers. Recently I came across a new hotel brand B4T owned by the East Japan Railway Company (JR East). In addition to the highly efficient train system they operate, JR East also runs shopping malls and hotels at train stations. Utilizing contactless self-checkin and checkout machine becomes a norm in Japanese business hotels these days, but what strikes me the most is how much farther the B4T chain goes by introducing cloud reception. It replaces a traditional on-site reception and management team with a 24 hr chatbot or video support team via the guest’s smartphone, which I assume can be located in a centralized place that supports all the B4T locations simultaneously.

What’s in

The hotel provides the absolute minimum set of amenities and pare down a hotel stay experience to the bare essentials of providing only

  • comfortable bed
  • toilet and bath
  • secured door

What’s out

Other than what’s provided in the room, you cannot request additional towels/toiletry or borrow other items. There’s no phone in the room because all contact with the hotel are conveyed via your own smartphone. No reception also means no package sending or receiving which is a core component of a Japanese hotel (you can send your luggage in advance to your hotel, or send it back home after a stay so as you free yourself from hoarding thems in public transportation)

There’s no vending machine, coin laundry, icemaker, and things we usually take for granted in a hotel but might not actually utilize during our stay. Even if we need to use those, due to the proliferation of convenience stores in Japan, can’t we just walk downstairs and browse the much broader (and better) selection there? In fact, some of the B4T locations actually sport a real convenience store next door. And for those who only stay for a night, going to the laundry might not be warranted. And how many people actually need to cool a drink or two during a stay? For those traveling light for a business trip, they obviously don’t carry around heavy luggage, thus there’s no need to send/receive luggages. By honing into their target audience (light travelers), and boldly eliminating everything that have a very low probability of usage, not only can the hotel slash upfront acquisition cost and cut room rate, it also reduces

  • inventory and operation cost
  • property management frictions (the need to subcontract and coordinate asset maintenance to different vendors)
  • opportunity costs (e.g., resources that can be spent otherwise on upgrading room comfort such as a better mattress, a more soothing shower head, higher quality fixture, etc.)

What can we learn?

Ask what is absolutely essential

Thinking about our own house and all our possessions, does it come as no suprise that we are also making all sorts of assumptions about what to stock, but in fact seldomly use? For example, we assume a suburb house must have a perfect lawn, and a kitchen needs to have some entertaining capabilities for big parties just because every house has it. Do we consciously identify the absolutely essential things in each context? Things that are left unused don’t get unnoticed. Rather, they take up space and require us to maintain them, consuming time, money and energy.

Consolidate and scale resources based on real demand

By centralizing operations that are standardized (e.g., each satellite performs similar tasks) to a hub, the hotel chain not only cuts costs but also becomes more flexible to demand and resource fluctuation. There are always times such as at 3 am when the front desk staff are idle but just standing by in a traditional setting. In contrast, the “cloud reception” team, just like server resources in cloud computing, can be scaled as needed from anywhere in the world. Reducing staff in each physical location also mitigates the labor shortage issue that has been plaguing the hospitality industry after the pandemic. This can also be seen in the usage of remotely operated robots to restock shelf in convenience stores.

Leverage external providers to offload peripheral jobs

We don’t need to be totally independent and provision everything in house. Like the B4T hotel that “outsource” vending and laundry, with a robust ecosystem around us, we can safely delegate tasks to (or purchase services from) external providers so we only focus on our core set of activities that provide the most value to our targeted users.

Conclusion

Does the B4T hotel feel so stark or a lack of “humanity”? I will only know after my next trip to Tokyo. However, given the vibrant nature of the city and its endless supply of activities, it is natural that a hotel that only provides what matter for a good and safe sleep at the end of the day will find its audience.