Smart City Strategies and the Forgotten Visitor Economy

In our latest contribution, Michael Driedger, co-founder and CEO of Operto, looks at the lack of focus on the visitor economy in smart city strategies

A smart city uses IoT to collect data in order to manage its resources and services more efficiently. These insights then form part of its smart city strategy, affecting planning, policy-making and innovation. Delving deeper into the wording of these strategies is a revealing exercise. Words such as ‘visitors’, ‘travellers’ and ‘guests’ are strangely absent, particularly as urban travel has increased so dramatically on a global scale. 

Vancouver, Canada, which is my home, has even removed hotel beds and banned Airbnb-style room sharing (for political reasons) – so why are visitors to our urban areas not being included in our smart city initiatives? Search London’s smart city strategy and you won’t find the words ‘tourism’, ‘tourist’, or ‘traveller’. The word ‘visitor’ also only appears once and no mention is made of making travellers to the city a part of their smart city plan. 

How does tourism factor into smart cities?

Facing inwards is something that cities have been doing increasingly over the decades. Sister cities (or twinned cities), once commonplace in the 1980s, have been forgotten, with more and more cities instead, choosing to create policies, plans and strategies in isolation. 

Therefore it’s not surprising that smart city strategies don’t mention tourism and internationalism outside of international investment in digital technologies. Decision-makers prefer to focus on infrastructure instead (which are tangible and can be moved forward by their engineering departments), such as fibre optic cable or 5G rollout. These citywide infrastructure projects are the types of smart city initiatives which garner the most focus. 

In my experience, cities generally struggle with innovative strategies and plans. Having elected bodies makes it tough to change and be nimble in regards to innovation because cities have had the same structures electorally and departmentally since their foundation.

Citizens don’t make a city

While researching many smart city strategies for this article, only the city of Edmonton in Alberta, Canada, recognized that in order to make real city changes, they need to move from a traditional government-centred approach to a citizen-centred model (page 8) in order to truly make their city smart. But even they still haven’t caught on to the fact that citizens aren’t the only people that constitute a city.

If you break down a city into residents and visitors you begin to see why current smart city strategies are going to struggle. London, for example, has a population of 9 million and it receives 30 million visitors a year. Three times as many people visit the city as live there. More striking is how this ratio increases for towns like Wisconsin Dells (the ‘waterpark capital’ of North America) which has a permanent population of 3,000 people with 4 million people visiting every year (and 10,000 hotel rooms). How do you build a smart city policy when you only account for the much smaller permanent population? That’s the key question. 

Layer on top of that, the hotel and vacation rental industry which is also the last vestiges of many analogue technologies. The online travel industry (due to heavy regulation in Europe) still extensively uses faxes because they need to deal with European hotels that have legacy policies of faxing reservations or guest confirmation details.

Vacation rentals collect paper contracts in places like Palm Springs in order to remit them to city officials showing compliance with local laws or scanned passports to city police for more and more locations across Europe. These industries need to be brought into the fold and incorporated into urban smart policies so that visitors feature in future planning policies and the growing number of travellers are taken into account in a modern technology-enabled future. 

“If you break down a city into residents and visitors you begin to see why current smart city strategies are going to struggle.”

Moving on from guests, did you know that hotels and hospitality properties have a much higher carbon footprint than everyday homes because they just don’t turn off? Hotels are ‘on’ 24/7, all-year-round. This simple realisation is another missing link in smart city strategies.

Sustainability and efficiency are key

A few years ago, whilst working with hotels (as part of a larger green building project), I noticed that the energy model predictions showed that the hotels were going to have the same energy footprint as the hospitals on the project. After talking with a number of engineers on the project (because I assumed this must be wrong), they confirmed that this is indeed accurate, ‘both building types never turn off’.

This was my rationale for creating Operto, which integrates smart building hardware like thermostats into the online booking world and makes short-term rental properties, hotels and serviced apartments more efficient. Increased efficiency through a more sustainable operation system can save 20% of the carbon and energy of heating and cooling systems. Smart property automation creates a smart stay in a smarter building which in turn can contribute to smarter cities overall. These are important issues for smart city strategies.

Taking the hotel energy problem back to Wisconsin Dells with their 3,000 residents and 10,000 hotel rooms, and you’ll probably find that those rooms only have a 50% or lower occupancy rate as visitor numbers to a waterpark in the winter season of Wisconsin aren’t very high. Energy accounts for 60% of a property’s carbon footprint, so now you are looking at a whole sector of buildings in Wisconsin Dells which has a carbon footprint that is well in excess of that of its permanent residents.

Any smart city strategy which doesn’t include the terms ‘tourism’ or ‘visitor’ certainly won’t be able to build a strategy around smart buildings or significant energy reduction. A smart city strategy in 2020 which doesn’t account for smart travel or smart stays isn’t really much of a strategy at all.