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Cendyn’s Charles Deyo isn’t your typical hotel tech founder by any stretch of the imagination. Deyo is an avid scuba diver, he meditates under pyramids for spiritual guidance and even plans to play guitar at an underwater music festival next year. By 1996, the same year that Expedia was born, Deyo had spent 20 years in the hotel industry before founding Cendyn with his wife Robin to help hoteliers win in the digital age. Cendyn’s first product to market was its eProposal solution which allowed hotels to accept group business RFPs via their websites and grow their group business. While eProposal is still a core component of the Cendyn Hotel Sales Suite, it is only a small piece of Cendyn’s current offering. Today Cendyn’s sales and marketing solutions power more than 30,000 hotels globally through products that touch on hotel CRM, sales software and hotel digital marketing services. Back in 1996, Cendyn’s initial product to market was its eProposal solution which allows hotels to accept group business RFPs via their websites to increase group bookings. Today, eProposal is still a core component of the Cendyn Hotel Sales Suite. The best tech companies listen carefully to client pain points and develop solutions based on those requirements. The history of Cendyn is a textbook example of how to build a great business by listening to your customers. As the internet boomed through the early 2000s Deyo and his team noticed that there was a huge skills deficiency in digital marketing amongst hotels and began to offer digital marketing services to help clients grow their direct channel. During our interview with the Cendyn chief, Deyo told Hotel Tech Report that the biggest inspiration for building his empire was Grateful Dead frontman Jerry Garcia. When asked why, he noted that the Grateful Dead is not just an iconic band but is actually one of the greatest brands of all time. The Grateful Dead brand is so prolific that at its peak it raked in more than $90M per year. Deyo believes that the Grateful Dead’s success could be attributed to one of Garcia’s core beliefs that is summed up in this iconic quote: “We did not want to just be the best at what we did, but the only ones doing it.” ~Jerry Garcia Deyo has always wanted to innovate ahead of the competition and be the “only one doing it” as an ode to Garcia. When Deyo started Cendyn there were few (if any) online platforms facilitating group business RFPs in hotels and he wanted eProposal to be the only one doing it. While others were busy copying his recipe for success, Deyo was pioneering the concept of hotel CRM to provide actionable marketing insights where hotel marketers previously lacked any tools to make data driven marketing decisions. Cendyn is yet again pushing ahead with plans to change the way hotels leverage CRM systems within their businesses. Historically, the hotel CRM sits within the marketing function but Deyo and his team believe it will become much more operational in the future and Cendyn is focused on pioneering the ways hotels leverage CRM systems for operations and not just marketing. Related article: "Super Angel" Dave Berkus on the convergence of PMS, CRS and hotel CRM Deyo believes that hoteliers, too, can benefit massively from living by Jerry Garcia’s credo. The hotel industry is one of the most competitive in the world and in order to stand out hoteliers must find unique ways to can add value for hotel guests, shareholders and staff. In this exclusive interview we spoke with Cendyn CEO Charles Deyo about the competitive advantage enjoyed by hotel technology early adopters, the evolution of hotel CRM as an operational tool and more. Power couple Charles and Robin Deyo co-founded Cendyn together What was your background prior to starting Cendyn? Before starting Cendyn I had many years of hospitality experience including 13 years at Hyatt Hotels as Regional Controller and AVP of Sales and Marketing, 3 Years at Kerzner International as Senior Vice President during the development of Atlantis in the Bahamas and 3 Years as Regional Vice President at Boca Resorts (which also owned The Biltmore and Registry Hotels). Tell us about the Cendyn founding story. After spending 20 years in the hotel industry, I realized that hotels needed software solutions to run their business better. We developed solutions that eliminated the pain points for hotels and drove sales and marketing performance. When Robin and I started Cendyn in 1996, the Internet bloomed in front of us and we decided to use this new medium to develop web-based tools that could help the industry we had worked in for years run their businesses better. The first product we brought to market was eProposal, which is still the industry leader almost 20 years later as part of the Cendyn Hotel Sales Suite. Back then, I did it all, from being the programmer to the accountant and everything in between. We were a small, family-run tech firm. After expanding into hotel CRM and digital marketing, (we were one of the early trailblazers in these areas for the industry), the momentum kept going as we won some of the biggest brands and best hotels in the world as clients. That really amped up with the investment from Accel-KKR a few years ago that gave us opportunities to open new locations, acquire companies and accelerate product innovation. Today, we’re lucky to have over 30,000 hotel clients using our solutions. Who was Cendyn's first customer? Frank Calaguire at Starwood. Frank and I worked at Hyatt together and we deployed our first SAAS solution (Cendyn eProposal) at The Westin back in the 90’s. Frank was a good friend and the Managing Director at Westin Copley Place. eProposal is now in over 22,000 hotels worldwide. The hotel tech market is incredibly competitive, how does Cendyn stand out? Cendyn is a cloud-based software and services provider that develops integrated technology platforms for driving sales and marketing performance in the travel and hospitality industry. The Cendyn Hospitality Cloud offers the most complete set of innovative software and services in the industry, covering hotel marketing, guest engagement, group sales, and event management. Cendyn's eInsight CRM is more than a marketing tool and delivers operational insight Who is one mentor that has made a big impact on your entrepreneurial journey? This is probably not one you hear everyday in hotel tech interviews but The Grateful Dead has had a huge influence on my perspective both personally and within the realm of entrepreneurship. Jerry Garcia said: “We did not want to just be the best at what we did, but the only ones doing it.” Most people don’t realize that the Grateful Dead was one of the most successfully marketed bands of their time and turned their brand into a cash cow which generated $95 million a year at one point. What's one commonly held belief that most hoteliers believe to be true that is actually wrong? Hoteliers believe delivering personalized experiences is hard. I have always looked at technology as an enabler for innovation. With the right enablers, hoteliers can take advantage of technology to make personalization easy, which is one of the cornerstones of our eInsight CRM product. I think either hotels don’t know where to start with their data, or they haven’t democratized access to the right people who can leverage it to drive home personalization. Hotels that standardize 2-way communication among systems and make data integrations a priority are the ones able to break through and outperform in personalization. Information is more relevant, robust and customized when all the systems are speaking to the touchpoints guests have in the journey. What's the most surprising thing you've learned about scaling technology into hotels since founding Cendyn? I was always surprised that standardized integration took so long for our industry. Today, we integrate to hundreds of hotel systems which is key to getting a true 360-degree view of your guest. There are hotels leading the way in how they use technology integrations and those at the other end of the spectrum, but what we do see day-in-day-out is in those hotels that have done so, they have an improved ability to; send the right message to the right guest, through the right channels; gain a clear understanding about the history and preferences of each guest in real time regardless of how they booked; empower their guests to receive information and communicate in the ways that work for them; and deliver the best kind of service, whether it be human interaction or through the use of technology. How do you see hotel tech changing in the next 5-years? We will see more intelligent use of data with AI and bots to further leverage the guest experience. Because of more integrations between technology systems and a higher flow of data between platforms, bots and AI will increase in learned automation and intelligence that can deliver more of the right messages, at the right time through the right channel. We’re in the process of breaking new ground with CRM technology as the core with bots and AI serving based off centralized intelligence. In five years, it will all evolve around the model of a central global profile for guests that references a sophisticated rolodex of data to help serve the customer’s desire for personalization at every touchpoint. Bots will make recommendations, personalize communications and adjust service algorithms in real-time based on data points. CRM will no longer be seen as a marketing function, but rather an operational tool that intelligently orchestrates how everyone interacts with a guest. For Cendyn specifically, we will continue to grow our organic revenue at 20% year over year, along with continued evaluation of M&A opportunities. Do you have any new products or feature launches? As we continue to operationalize CRM for hotels, our latest release of eNgage allows for more sophisticated algorithms that anticipate varying engagement opportunities with hotel guests that, in turn, alert hotel staff. We have a lot of hotels using this solution with great success for personalization, including our client TFE Hotels, headquartered in Australia. They’ve got eNgage across their international hotel group in Australia, New Zealand, Germany, Denmark and Hungary. What advice do you have for hoteliers in this economy? Adopt more technology. Even with all the strides the hotel industry has made, it is still behind other industries. Technology must have an ROI by driving sales and marketing performance. With eInsight, our CRM product, we drove an average 33X ROI for our hotel customers in 2018. As the economy hits an inevitable slow down, technology will determine the winners and losers. What's one piece of advice that you have for any entrepreneurs looking to get into the hotel tech space? Keep it simple. Make it valuable. This has been a mantra of Cendyn from the beginning of our company. What is the best book you've read lately? I think we are experiencing significant generational differences due to technology, social media and the varying thought processes. Given that, I thought “Sticking Points” by Haydn Shaw does a great job of explaining how we can make this work with our evolving business teams. Great people working in harmony make great companies. What is your favorite podcast Cendyn’s upcoming podcast series, of course. What is one thing that most people don't know about you? I play guitar and am certified in scuba diving. I plan to play the underwater music festival in Big Pine Key, FL next year. I also meditate under a pyramid on life and business opportunities when needed.
Unseasoned technology buyers often make the assumption that the biggest companies have the best products. It’s not a terrible assumption when you think about it. After all, didn’t the biggest companies become so big by delivering great products to clients? There’s the old adage that “nobody gets fired for buying a Xerox” - doesn’t that still hold true? It’s true that big companies often get big by delivering great service to clients but technology changes so quickly that assuming ‘bigger = better’ can lead technology buyers into precarious waters. When companies get to a certain size, they risk losing focus on customer relationships. Many massive companies, especially in hotel tech, have become synonymous with poor customer service. Think about the last time you called your CRS vendor because the system went down but they don’t reply for 48-hours - that’s a major problem. Similarly, when engineering team grows to a certain size, the company’s products become plagued with feature bloat. Teams become more and more disparate which makes working on the same product a disaster if the organization isn’t managed properly. Big companies are also notoriously susceptible to disruption from smaller and more nimble firms. This isn’t to say that everyone should go jump into bed with the startup down the street. The most savvy buyers know to look for the most innovative vendors who have achieved product market fit, are innovating quickly and will become the giants of tomorrow. Travel Tripper is a firm that has proven itself in the market, is innovating at a rapid clip and still maintains strong relationships with clients through world-class customer support. Don’t take our word for it, read what verified Travel Tripper customers are saying. Perhaps that’s why hoteliers have rated Travel Tripper’s CRS #1 in the world for 2 years in a row. The firm has recently expanded its offerings through a highly praised merger with Pegasus so we sat down with Travel Tripper president Gautam Lulla to get a behind-the-scenes perspective on what’s to come. The important thing for hotels to remember is not to judge tech vendors by the size of the company, but by the quality and capabilities of their product and their dedication to customer service. ~ Gautam Lulla Prior to launching Travel Tripper, Gautam worked at hotel tech giant Amadeus so he has seen the inner workings of both startups and massive enterprise in the space. He also began his career working in hotel operations and eventually corporate hospitality where he developed unique insights about the hotel tech vendor landscape before jumping in himself. As with many great businesses, Travel Tripper’s founding team created the business to solve real-world problems that they were experiencing. After working with several distribution and marketing technology vendors, the leadership team at Highgate Hotels wasn’t impressed by the results they achieved and thought they could do it better, so they launched Travel Tripper. It turns out that they were right -- now hotels around the world are knocking on Travel Tripper’s door to tap their knowledge, technology and services. We are lucky to have caught Gautam in the midst of his integration between Pegasus and Travel Tripper, which he calls a highly synergistic transaction. Gautam Lulla Travel Tripper's NYC Headquarters What does the Travel Tripper-Pegasus merger mean for clients? It’s important for us to emphasize that as a combined company, no capabilities or services will be lost. In fact, exactly the opposite is the case. The driving force behind the merger was our complementary set of strengths, from our product offerings to our customer base. In this case, 1 + 1 really does = 3! To illustrate, Pegasus has always been uniquely and natively built for enterprise hotel chains and have more experience serving chains than any other business in the history of the hospitality industry. Additionally, Pegasus has a long and proven record of helping hotels increase corporate business with their Corporate Sales Representation Services, offering instant connections to 800+ corporations and 30+ consortia and TMCs. Additionally, the recent introduction of Pegasus Business Intelligence Platform gives Revenue Managers the ability to turn their raw data into actionable information to positively affect their bottom line. Travel Tripper has built its reputation among independent hotels and casinos with its powerful CRS, e-commerce, and digital marketing solutions, which work together to help hotels grow their overall business while maximizing revenues in their direct channel. Combining this strong suite of products means that we can now offer existing customers and prospects a broader range of solutions tailored to their needs. What is Accel-KKR's thesis behind the new infusion of capital? Accel-KKR is a company that invests in high-growth technology companies in many verticals and different industries, not just hospitality. The primary thesis for their investment was the recognition that both Travel Tripper and Pegasus were two companies with a similar DNA of innovation and top-notch customer service, as well as complementary sets of strengths in our product offerings and customer base. They believe that they can provide us the infrastructure and support to help take our combined company to the next level. What was your background prior to launching Travel Tripper? I started my career in the hotel industry with Taj Hotels in India, where I was introduced to the world of hotel technology, after spending about a year or so in the front office. As Electronic Marketing Manager, I was responsible for managing the usage of our central reservation system as well as building and strengthening relationships with our CRS providers. I was also responsible for growing the GDS business. Subsequently, I joined Pegasus Solutions in Scottsdale, Arizona as a Product Manager and stayed there for about two years. It is where I learned all about the the workings of a CRS, and what better place to learn it than at Pegasus. It was the clear leader in the space with no competitor even a close second to Pegasus. Later on, I accepted an offer from Amadeus in France to join their e-commerce team. Hotel booking engines were a part of the portfolio, however as a GDS company it was not economically viable for hotels to pay GDS transaction fees on top of CRS fees for their direct booking channel. But Amadeus decided to invest in Hotel IT solutions, with the intent of replicating their success in Airline IT. I subsequently moved from France to the United States and continued with Amadeus for two years, during which time I became deeply involved with our first prospective customer. But after a short while with Amadeus USA, I realized I was also far removed from the center of activity within Amadeus and got a little bored. It’s when I decided to join Travel Tripper, in its earliest days. What made you decide to jump in and launch Travel Tripper? My friend and ex-colleague Kurien Jacob had just started a booking engine company and asked me to run and grow the business. After leaving Amadeus, I was ready for a new challenge that would allow me to work at a much faster pace, so I jumped right in. Technically, I didn't found the company, but I joined as a partner when we were just a team of three people. As a partner, I did or oversaw everything on a daily basis—from product design and development to engineering, sales, and marketing, invoicing, customer support, so, literally everything that a young company of that size has to deal with. Travel Tripper's Reztrip CRS took gold in the 2019 HotelTechAwards Who was Travel Tripper’s first customer? Highgate Hotels was our first customer at Travel Tripper. Kurien, who had started the company, was the Chief Revenue Officer at Highgate Hotels at the time. He was convinced that Highgate could earn more direct business if they designed a booking engine, designed by the way, as a seed that would grow into a full-scale CRS, with certain features. So, that was sort of the rationale in founding, the raison d'être of the company. It became our motto and philosophy: Be Direct. Highgate tried out the first version of our product on one of their properties, a very large midtown Manhattan property. Even though it was a big risk for them, they went ahead and tested the technology anyways. After seeing spectacular results with the first property, we rolled out the booking engine across various Highgate hotels in New York and elsewhere. One of our other early customers was the Leela Hotel Group in India, which also benefited a lot by taking a chance on us. We increased their website contribution by very impressive numbers. Another early customer of ours was the Stratosphere Hotel, a large 2,500-room hotel in Las Vegas and our first casino hotel (a segment in which we now have 30% market share in the U.S.). We were able to get them on board because of our strong track record. They joined us in 2008 and significantly increased their website contribution as the result of our partnership. How do you see Pegasus and Travel Tripper working together moving forward? The combined entity of Pegasus and Travel Tripper provides a solid platform for hotels that want innovative technology solutions combined with the best customer service in the industry. Pegasus has a deep and storied history in CRS and distribution, and offers world-class demand generation services designed to increase direct and corporate bookings while considerably expanding a hotel’s market reach. Travel Tripper has grown a strong reputation in helping independent hotels and casinos/resorts in direct channel optimization, bringing user experience to the forefront in our CRS, booking engine, e-commerce, and marketing solutions to help drive highly profitable direct bookings. Our merger brings together the best of our combined capabilities to help hotel groups large and small to directly own guest relationships and maximize bottom-line ROI. In short, we are a formidable and disruptive challenger to some of the bigger (yet more stagnant) players in this space! Who is one mentor that has really helped you scale the business? I’m lucky to have several mentors who have helped and influenced me at different stages of my career. In my early days at Travel Tripper, right after leaving Amadeus, I remained close friends with an ex-colleague of mine, Andy Ahluwalia, who has since passed unfortunately. Andy had built a successful business in our space and was very encouraging and gave me sound advice about the effort and the patience that it would take to make this company successful. He also taught me a lot about how to sell the product and negotiate with customers. I'm very grateful to have known him. Kurien and the team at Highgate, from whom I’ve learned a lot, have also been spectacular supporters of Travel Tripper. Of course, they have been one of our key customers since the beginning and have a vested interest in our success as a company. They’ve always been very encouraging and have provided me with the space and room to make mistakes and persevere while growing Travel Tripper. Highgate itself has grown tremendously since the time when we started our company. Watching their growth and expansion, even as they were already such a large company, has been an inspiration for me. And Paul McGrath, erstwhile and now again Product Manager extraordinaire was my first boss at Pegasus—he taught me all about the workings of a CRS. Paul led the product management team at Pegasus during its heyday and has returned to the company to once again lead the product management team of our combined company. What's one commonly held belief that most hoteliers believe to be true in your niche that actually is false? Unfortunately, in this industry, the size of a hotel tech vendor sometimes is overplayed or overemphasized, while the quality of product and engineering teams is underemphasized. People often assume that large companies have better products simply because they can afford better engineers relative to smaller companies. This is far from the truth—I've seen very large companies struggle with their platforms and engineering initiatives. And I’ve seen smaller companies blow away the industry with their solutions. The important thing for hotels to remember is not to judge tech vendors by the size of the company, but by the quality and capabilities of their product and their dedication to customer service. It seems obvious, but happens more often than you think. What's the most surprising thing you've learned about scaling technology into hotels? I don't know if I can call it a surprise as much as learning, but one of the things that we have learned how to do effectively is to scale the platform based on evolving needs. For many organizations, it is quite difficult to anticipate the proper architecture in its early days until you meet challenges along the way. You can plan and design for scale, but there will alway be unexpected hiccups and scaling issues that you will certainly come across along the way, no matter how well you plan ahead. Therefore, you should plan and design as best as you can, but also be prepared to make some fundamental changes along the way when you encounter obstacles. We've done that several times throughout our history and have been able to successfully scale the platform. For example, when Travel Tripper took on Stratosphere Hotel around 2008, I recall that traffic volumes would peak around a certain time of day, and the system would simply keel over and fall down, so we always had to reboot at around 4:00 p.m. It turned out that was a relatively small problem to solve that wasn’t anticipated at initial design time. Along the way, we've come across other challenges as our customer base grew to a certain size. At one point, we started getting hit by a lot of robots that were scraping our booking engine user interface to get pricing information on our hotel customers. This is a common phenomenon in our industry and we were able to resolve the issues along the way when we encountered them. What have been some of the most successful partnerships for Travel Tripper over the years? Obviously we have numerous close partners in the industry, and our relationships with all of them are very important. We enjoy our partnership with Stay Wanderful, which provides a conversion optimization tool that helps hotels to increase their direct bookings and revenue through instant gratification and AI technology. We have worked closely to provide a strong integration and good user interface that generate good results for our customers. OTA Insight has also been a great partner for us on the industry level. Their company offers one of the top hotel Rate Intelligence/Business intelligence platforms on the market. We often run many marketing initiatives together to help educate the industry, such as webinars, roundtables, and our upcoming Tech Talks series at ITB Berlin. If you could partner with any vendor in hotel tech, who would it be and why? As a CRS company, there are so many vendors that we need to build interfaces and integrations with. We particularly enjoy working with the ones that are open to quick integrations in order to foster better functioning between our respective products. In other words, they do not lock up their APIs and charge unreasonable fees for integration and certification. How will the hotel distribution landscape change in the next 5-years? Traditionally, the companies in the hotel tech space have focused on being very good at one “category” of product. Sure, a PMS company could offer a booking engine, but ultimately it was more known for being a PMS company. The new startups in the space have amplified this trend. But now that companies are starting to mature and consolidate (ourselves included), the lines are going to start blurring and it’s going to be difficult to pigeonhole a company into a product type or category. The industry is moving quickly in the direction of a “platformization” model, where the breadth and interconnectedness of solutions will trump—or at least bring together—smaller niche solutions. We think we are on the cutting edge of that trend. We see ourselves as the strongest provider of the products and services we offer to the hotel industry. We are well on the way already. Does Travel Tripper have any new product or feature launches we should know about? Travel Tripper and Pegasus have recently launched innovative new products lately that we think are going to be very exciting for our respective customers and prospects. To help hoteliers combat rate disparity and increase direct revenue, we created Rate Match, a powerful price checking and rate matching tool that automates best rate guarantee against the OTAs. On the e-commerce side, we recently introduced a very simple but enormously helpful ADA Monitoring Platform and audit services to help hotels mitigate legal risk of potentially expensive ADA compliance lawsuits. We are also about to launch Conversion Plus, a new direct booking optimization tool that drives conversions using personalized messaging and special offers based on real-time booking engine rates, OTA comparative rates, and user behavior. There is power in numbers which is why we recently launched the Pegasus Business Intelligence Platform. This solution offers Revenue Managers a way to turn raw data into immediately actionable information to amplify revenue management and marketing success across all distribution channels, all in one place. We combine guest data from multiple sources and deliver it with automated intelligence and easy-to-understand dashboards. The result is instant insights that help guide a hotelier’s strategy to increase bookings and occupancy and improve revenue and profitability. What's one piece of advice that you have for any entrepreneur looking to get into the hotel tech space? Be patient and persevere. It's a crowded space, and it’s getting increasingly more crowded and competitive. There are a ton of companies that you will need to work and integrate with in order to succeed. In the hotel CRS space, the barrier to entry is quite high so it will require a lot of money and technology to be built before you can come in with a viable product for a meaningful segment of the market.
Direct booking campaigns have been a centerpiece of hotel marketing for several years now. The push to encourage guests to ‘Book Direct’ stems from efforts to both reduce commissions paid to third-parties and to forge stronger bonds with guests. Without an intermediary, a hotel can market to the guest before, during, and after the stay, regaining control over the guest relationship, both financially and strategically. Evidence shows that the efforts have begun to pay off, says hospitality marketing firm Kalibri Labs: Loyalty member campaigns have either strengthened or stabilized the growth through Brand.com, while the OTA channel has either held steady or decelerated. Brand.com generates 50% more bookings on average to U.S. hotels than the OTA channel. To make its assessment, Kalibri Labs analyzed 80 million transactions from 18,000 hotels in its proprietary database. The results are promising, revealing solid gains in profitability and rate competitiveness among sampled hotels. Related article: Do loyalty programs for independents actually work? Direct bookings are more profitable Hotels prefer direct bookings due to the lower customer acquisition costs, which have been rising for the past several years. When it comes to how much revenue hotels spend on booking-related costs, the data reinforces the narrative that OTA commissions have risen at the greatest clip. With hotels facing 45% commissions from that channel, the 27% cost for loyalty-based bookings is a striking contrast. However, once a hotel turns away from intermediaries, it must spend money on marketing to secure bookings, some of which is spent on paid search and some on discounted Book Direct rates. So, some of the money saved on third-party commissions ends up going out the door anyhow. Even after accounting for the additional costs of paid search and discounting, the Kalibri Labs analysis found that direct bookings were 12.5% more profitable than those derived from OTAs. In fact, the more impactful value of direct bookings may be in the corresponding rise in Average Daily Rate. The ADR for Member Rate/Loyalty bookings reflects a solidpremium compared to OTA bookings (after acquisition costs are removed). ADR has grown to 9% in 2018, up from 8.6% in 2016. Even when tested for weekend/weekday and lead time differences, Net ADR for Brand.com loyalty bookings is higher in total, and for each chain scale. This is counterintuitive, as members-only rates are promoted as the “best available rate.” Are hotels lying to guests? On the contrary, guests are responding to the upsell. That’s the whole point of recapturing control of the guest relationship: Once a hotel can market directly to the guest through its upselling platform, it reveals new revenue opportunities such as room upgrades, bundled room rates, and premium experiences. It appears that guests respond to these efforts, pushing up the net ADR for brand.com when compared to the OTA channel. To achieve the greatest profitability for your hotel’s direct booking efforts, keep your marketing costs in check with metasearch management tools. And don’t neglect your hotel website - make sure you are working with a top rated digital marketing agency for hotels that can optimize conversion to your booking engine; you want potential guests clicking through from search to have a user-friendly experience. Direct booking tools can also encourage new sources of demand, such as from travel agents, in addition to existing loyalty members. Loyalty programs generate more bookings at a lower cost Since the launch of mainstream direct booking initiatives in 2016, loyalty program memberships have grown at between two to five times the growth rate before Direct Book. As more guests enroll to take advantage of exclusive rates, more bookings originate from loyalty members. In fact, the report found that “almost half of the business in the U.S.branded hotels is derived from loyalty members.” Do loyalty programs for independent hotels actually work? The cost savings are also significant. It’s just more expensive for a hotel to keep purchasing a booking from an intermediary, rather than re-engage a loyalty member to generate a booking. When calculating the benefit of a recurring guest coming three times after an initial visit, the average net benefit to a hotel using industry averages is approximately $65 per loyalty member, compared to cycling through 4 different OTA customers. To maintain that top-of-mind engagement with loyalty program members, carefully segment guests in your hotel’s CRM and then schedule e-mail marketing campaigns to nurture those relationships. With a precise and thoughtful approach to loyalty marketing, your hotel can generate more bookings at a lower cost, all while building that long-term relationship. A Revenue Management System is also beneficial to hoteliers seeking a more balanced approach to distribution. With the power of a comprehensive RM, small tweaks can create big results. This granular control of pricing strategy drives better ROI for direct bookings, which generate $8.33 for every $1 spent. Compared to the $4.77 to $1 ratio for OTA bookings, the investment in loyalty-based revenue management technology delivers more bang for the buck. It’s all about the mix Ultimately, it all comes down to channel mix. Hotels that work with OTAs must do so with an honest appraisal of the value these channels bring -- and how direct bookings fit into a specific hotel’s revenue profile, says study co-author Cindy Estis Green: “[OTAs] will do anything to be a part of the sales path. If you collaborate with them, you have to do it with your eyes open. The trick for each hotel and brand is to determine in each market what pipes are flowing and what’s available. It’s optimal to cherry pick which bookings are available at the highest possible profit margin. That’s the challenge everyone has.”
Creating a great work environment is the single biggest determinant of success for any business. Companies that foster great work environments attract the best people and the best people build the best products. A 2017 study that analyzed 326,000 employee reviews at publicly traded companies found that firms with high employee satisfaction outperformed the overall stock market each year by 135bp (1.35%). A similar study of 400,000 employee ratings found evidence of a statistical relationship between employee perception and a firm’s future earnings. Sophisticated enterprise software buyers know that when they partner with a technology company, they are buying into not just its products but its vision, mission and team. These buyers perform due diligence to understand the viability of any business that they plan to partner with and a deep analysis of employee satisfaction and vendor culture is part of that process. Hotel Tech Report hosts this award not just to help the community find great jobs, but also to help fast track diligence for hotel tech buyers who want to learn about the best vendors to work with. Understanding organizational culture is important for software buyers because companies that create great work environments retain employees longer, service customers better and innovate faster. Perks like ping pong tables, office snacks and vacation days are nice, but our 10 Best Places to Work in Hotel Tech list is determined by the glue that holds companies together. Each year we ask thousands of employees at hotel tech companies how they feel about their employers and anonymize the results. The 2019 scoring is based on 7 key data points: Work-life balance: Please rate how well your employer promotes work/life balance. Personal development: How much importance does your employer place on your own personal development? Gender equality: How would you rate the opportunities available to women in your firm? Employee confidence: How much confidence do you have in the future of your company? Values alignment: How well do your values align with the culture of your organization? Employee engagement: How passionate are employees about the company? Growth prospects: How many open roles are there for your employees to grow into? Without further adieu we give you 2019's 10 Best Places to Work in Hotel Tech: 10. Triptease Our research on Triptease validates that the Company truly lives and breathes the ethos of its name. Employees consistently cited off-sites and team trips as the highlights of their year. According to LinkedIn data, Triptease has grown its employee count 72% in the last 2 years. Sometimes when companies grow that quickly, it’s hard to maintain a great team culture. With the team spread all around the world, Triptease brings new employees for training and team building to the LondonHQ. New employees rave about the experience for the learning and friendships that come from it. Other notable events include Triptease’s renowned Direct Booking Summits (America, Europe, Asia) and a company wide Christmas party in Madrid (let us know if you need HTR on the scene to cover next year’s party - this one sounded like a rager!). Triptease employees are constantly blown away by how much management cares. One employee cited an unexpected bonus for a month of killer performance and another described to us how open management is to employee travel focused on career development. Ultimately, Triptease is one a big happy family and employees around the world are constantly connecting through a multitude team building activities and trips. Employees love the fast paced nature of consistently launching new innovative products. Check out open positions at Triptease 9. GuestRevu GuestRevu had a year in which critical company milestones rallied the team together. Not only did GuestRevu acquire a large regional competitor but the team also launched a major version update that required all hands on deck. Despite all the craziness of rapid growth, a new version launch and a major acquisition - one employee raved to Hotel Tech Report about how supportive the entire team was during the loss of a loved one. Another told us that she often needs to bring her 9-year old to work where he is always made to feel welcome and at home. The firm is so committed to its team that it sent out a company wide survey asking what employees wanted to learn and then purchased everyone access to Udemy classes to help them develop those new skills. The marketing team took classes on video editing and is already leveraging those skills to develop a series of video case studies for GuestRevu. Check out open positions at GuestRevu 8. Beekeeper For a company building software to help teammates communicate better - Beekeeper takes employee engagement and experience very seriously internally. As one employee told us, “Beekeeper does an excellent job of capturing feedback and always checking in to understand where you want to go and providing actionable feedback and support to get you there.” The Company promotes a healthy lifestyle through lunchtime sports and CrossFit. Taking it one step further, Beekeeper offers unlimited PTO and flexible work schedules to accommodate the expectations of the modern workforce. Beekeeper’s culture exudes transparency and humility. One employee told us that the team was initially put off by management’s decision to require employees to clean dishes at an off site before they realized that this was all part of the team building. This employee told us that the people they ended up washing dishes with ended up being their closest new friends and that the experience gave them an opportunity to bond in a way that most rarely do in the modern workplace. Another employee told us about a rewarding experience they had volunteering together at a homeless shelter. The team’s humility shined through further when a new employee (2 weeks in) alerted management about tensions between two departments. Much to their surprise both teams were thrilled to hear their new colleague’s insight and showed their appreciation. Management even went one step further offering this individual to run a huge cross-departmental retrospective 5 weeks into their job. It’s not often that companies are so open to self-reflection and change coming from a new junior hire and we really admire the culture that Beekeeper has nurtured. Check out open positions at Beekeeper 7. Hotel Effectiveness Hotel Effectiveness is an incredibly successful company that largely flies under the radar of hotel tech buzz. The Company provides revolutionary labor management software that we’ve covered here. If there’s one word that sums up the Hotel Effectiveness team culture - it’s ‘performance’. Employees are unilaterally motivated by consistently hitting lofty sales goals time and again. As a testament to this performance driven culture - one employee told us that one time their boss had to tell them to go home early and make some time for family when they were overworking themselves. This performance culture isn’t mandated from the top and is completely grassroots in that it’s driven by internal employee motivation and ambition. While you can expect to work alongside incredibly driven and ambitious colleagues at Hotel Effectiveness - they definitely know how to have a good time host a hilarious annual white elephant Christmas party. Check out open positions at Hotel Effectiveness 6. Revinate Revinate’s culture is characterized by constant iteration and testing. The Company is always trying new things and that affords a ton of learning opportunities to team members. This year while the technical team executed a full shift from hosted data center to cloud based AWS infrastructure the sales and marketing teams were tasked to rapidly grow the install base of the Revinate Marketing product. Both teams executed with near perfection and everyone celebrated with an impromptu party where key team members reflected on the incredible achievements of such a relatively short time period. Revinate embodies the startup spirit with enterprise scale. Revinate CEO Marc Heyneker is deeply involved in the day to day operations of the business and employees across the organization rave about his ability to inspire and teach. One employee told us a story about a serious head injury that left this person working remotely for several months. His team made sure to make him feel included as part of the office through the entire time away but that was only the beginning. The employee recalled being shocked that over a year after his injury Heyneker pulled him aside to check in on his health and to ask what he could do personally to help. Check out open positions at Revinate 5. Cloudbeds Cloudbeds management recently surprised its team with a beautiful new San Diego headquarters equipped with a 14 ft indoor willow tree, a massive outdoor workspace, game areas, stand up workstations and more. The environment is fun, welcoming and echoes the company theme - all things travel. Cloudbeds has an extensive wellness program because management knows that healthy employees are productive ones. This productivity paid off in 2018 where Cloudbeds achieved #75 on Inc Magazine’s fastest growing companies list. How are they growing so fast you ask? Well it’s probably because CEO Adam Harris told the team he’d dance to any song of their choosing. We will keep you posted once we get our hands on the video from Harris’ co-founder Richard Castle. The Company maintains several internal chat threads exclusively for team sharing of funny photos, videos and memes - so we expect the video to surface there as well. All jokes aside, Cloudbeds takes both employee and team growth very seriously. Each employee has weekly 1-1 meetings to review competencies and revisit their path to promotion. The Company is growing rapidly and there are constant opportunities for employees who prove themselves. Cloudbeds is also a 100% flexible organization where remote employees and those stationed at the headquarters all enjoy the ability to work from anywhere anytime. Cloudbeds has fostered a culture where its team members truly enjoy hanging outside of work and building friendships important for their personal and professional lives. Several Ukrainian teammates trained for a marathon together and one customer success rep has leveraged her friendship with the UX designers to pursue her passion for design. After taking several courses independently the UX team has given her several opportunities to practice her skills on live projects. Check out open positions at Cloudbeds 4. Clock Software Clock Software is another company on our list that is growing insanely fast but doesn’t take itself too seriously. One Clock employee told us that on their birthday coworkers wrapped his entire workstation and even put a bow on it. The only complaint we heard from Clock Software team members was that they are growing too fast and needed more staff to manage the growth. This is the best kind of problem to have. Clock is the oldest company on our list and celebrated their 22nd anniversary this year - a testament to the longevity of the business. Clock founder Krasimir Trapchev has focused on growing the client base without scaling the team too quickly. Trapchev is all about execution and he’s prioritized building a long term sustainable business over rapid scaling which is extremely unique in an environment where funding is so plentiful that CryptoKitties, a company that enables users to breed and trade digital cats can raise $15M. Clock is now starting to scale the team so it can take on more enterprise clients and its employees are fired up. If you want to learn how to build a real business without massive amounts of venture capital - check out open jobs at Clock because Trapchev is the Mr. Miyagi of entrepreneurship and you’d be wise to make yourself his Karate Kid. Check out open positions at Clock 3. Screen Pilot Screen Pilot takes team building very seriously with activities like bubble soccer, a British Bakeoff (it’s ok we Googled it, too), volunteering at an animal shelter, an escape room and even a city wide scavenger hunt around its hometown in Denver. The scavenger hunt and Screen Pilot’s quarterly volunteer days are a testament to Screen Pilot’s commitment to the surrounding community. While Screen Pilot is a top rated digital marketing agency, it’s a technology innovator as much as a marketing service provider. The Company has created what it calls SP Labs where employees brainstorm ways to better leverage technology to help its clients win more direct bookings. Think of SP Labs like an ongoing internal hackathon with dedicated teams set on solving acute problems for clients. It’s this kind of innovative mindset that lead Screen Pilot to a 2018 Adrian Award for social content creation. Check out open positions at Screenpilot 2. Mews Systems If you caught the Mews Systems booth at WTM you might think that it was a rocket science company with all the lab coats and futuristic decor that earned it the Best Stand Award. While Mews isn’t quite a rocket science company it is taking off like a rocketship having doubled its client base in the second half of 2018 alone. To support that kind of insane customer growth Mews had to 4x its team size in the last year - the fastest growth of any company in our list. So how can a company even hire that fast? Mews attracts 40% of new hires via referrals. If that doesn’t say something about the company culture we don’t know what does. With that kind of insane growth supported by an $8M Series A in June you’d think it’s all business but Mews employees say it’s very much a “work hard, play hard” culture. One employee told us that one of his favorite things about working at Mews is “daily banter with the boizz” - this kind of hilariousness is exactly what’s helped the Company take the industry by storm. Hoteliers everywhere are sick of generic jargon and boring brand marketing from hotel tech firms and Mews is the antidote. Employees frequently cite founder Richard Valtr and CEO Matt Welle as saying “At Mews we are family and we will take care of any family member in need." Mews also boasts an extremely inclusive culture illustrated by the firm’s attendance at the Prague Pride celebration wearing special edition Mews gear to the event. The Company also has a shared value culture at its core and participated in UK Byte Night last year. Byte Night prevents youth homelessness by having corporate teams sleep in the streets to raise awareness and funds for the cause. Richard and team participated which is really cool and a statement to the quality of people that you’ll work with when you join the Mews team. Check out open positions at Mews 1. ALICE ALICE employees widely agreed that quarterly town hall meetings are the foundation of ALICE’s connected team culture. ALICE staff loves the opportunity to connect with colleagues from around the world, align around the company vision and get transparency into how the business is performing at a macro level. More than doubling its size in 2018, ALICE unsurprisingly had to upgrade its HQ office to add more space and acquire obligatory startup amenities like a cold brew keg, stand up desks and lockers. ALICE goes so much deeper for its team and invests heavily in career development. Employees participate in a company wide book club, receive access to free Udemy courses and are nurtured along a very clear path to promotion. ALICE employees talk about the clarity of path to promotion more than any other company’s employees on our list. Setting a clear path to promotion is important for making employees feel like they’re constantly progressing and puts them at ease knowing that there’s always room to grow internally. Major consulting firms like BCG and McKinsey have perfected this art but rarely do we see startups who are able to provide such transparency to their staff - kudos ALICE management.One employee told us that she was promoted 4 times in the last 3 years - a testament to ALICE’s ability to reward top employees. Even a remote worker was able to win ALICE’s Culture and Values Award twice in 6 months. This individual told us that they felt like they were on an island while working previous remote jobs - but felt very connected to the inclusive ALICE team. ALICE acquired GoConcierge this year and is making serious strides with major enterprise clients after its $30M Series B funding - a testament to the strong prospects for the firm and probably why employee confidence in the firm is best in class. “When you receive a high five from the CEO, that says a lot about the culture of the company,” says one team member. High fives all around! Check out open positions at ALICE
It's never easy to push through the hype and find the substance -- especially in hospitality, which is a challenging blend of guest-facing technology and back office software. Each year the technology world looks to Wall Street analyst-turned-VC Mary Meeker for her annual “Internet Trends Report”. Meeker’s report uses data to tell stories of business-related trends that are shaping society. Using data from Meeker’s report we identify some of the macro global trends impacting hospitality in 2019 and beyond. Unless otherwise noted, supporting images below are pulled directly from Mary Meeker’s presentation. Mobile saturation means devices everywhere This slide highlights the slowdown of smartphone growth. How does that impact hotels? The slowing growth of smartphone sales means that we’re approaching market saturation and consequently every single traveler in the world will soon have at least one in their pockets. This means that we need to focus on being where they are. The saturation of mobile also means that guests -- and staff -- expect easy-to-use interfaces and seamless cross-device experiences. Technology must be unfussy and straightforward, working wherever and however the guest and staff need. For guests: Mobile-optimized booking engines and guest messaging platforms are two of the most visible guest-facing applications. When searching for hotels, potential guests want to see a modern booking engine that builds trust in the experience a hotel provides. When staying at a hotel, guests want to communicate with the hotel as easily as they do with friends and family, and via the same channels (such as SMS and messaging apps). For staff: When hotel staff comes to work, they shouldn’t have to re-learn how to interact with technology. Mobile task management and collaboration software allow staff to use familiar mobile devices to get things done more efficiently on-the-go with built-in accountability. When evaluating vendors, these factors should be towards the top of the list for any hotel that wants to offer the most modern experience. Remember that both staff and guests have plenty of options when it comes to where to stay and where to work. Providing technology that makes life easier, better, and less stressful will bear fruit over time. The simplicity of consumer experiences now extends to B2B. People expect all technology to have intuitive interfaces and reliable connectivity. App explosion delivers near-infinite options It seems like every company has an app store these days. As more and more companies seek platform status, they launch app stores to encourage development on their platforms. By opening up development, the underlying technology becomes stickier, making it more useful to hotels and also more lucrative for the platform company. There are two things driving this “appification everywhere” trend: plummeting storage costs and rising computer power, which has made cloud computing not just practical but affordable. In parallel to the growth in mobile, cloud computing has made it more feasible for apps to be more lightweight and nimble. Stats showing the growth of computing power and hard drive capacity alongside the steady decrease in the price of storage. Apps no longer require heavy computing power and on-device storage to deliver the impact required in a B2B setting. Now, apps can connect to the cloud to pull necessary information in real-time, making apps faster and more accurate even as apps become more complex. Apple’s App Store was the first to thrive. Now, nearly every platform and many travel technology companies have app stores as well. For hotels, 'appification' has ushered in a golden age of choice. There are now app stores for many of the largest travel companies, allowing hotels to plug-in specific apps for a wholly customized tech stack. In 2018 alone, we saw the launch of app marketplaces and integrators from travel technology companies Mews, Apaleo, SiteMinder, and Snapshot. Here at Hotel Tech Report, we’ve partnered with protel’s I/O marketplace to integrate rich reviews to its app store experience. This layer of social proof adds richness to the company’s marketplace, which allows hotels to pick, mix and test cutting-edge technologies all in one place. App integrations are also becoming much easier as services such as Impala and HAPI emerge to simplify the process of connecting apps through configurable APIs. As more hotels push to build the specific tech stack that works for them, these app marketplaces and API services will grow exponentially in the coming years just the same as we’ve seen happen with more mature app stores from companies like Apple and Google as shown in Meeker’s deck. An app store with honest reviews builds trust. Hotel Tech Report reviews are fully integrated into the protel I/O app marketplace. On-demand jobs exacerbate talent shortage More workers are turning to the on-demand gig economy to supplement earnings. Freelance workers also find work much more easily thanks to technology. As more workers find freelance work feasible, hotels face growing competition for talent, exacerbating an already-acute talent shortage. Technology continues to empower workers to build a work life that works for them. Hotels must keep up to remain competitive for workers. The flexibility in freelance and gig work appeals to workers, so hotels can apply some of this to their own scheduling. Providing workers with a degree of latitude in the way they work will make for a more appealing workplace. With more individualized control for staff, mobile-optimized labor scheduling solutions foster trust and transparency across a hotel’s operations. In addition, technology must be leveraged as a key selling point to potential workers. With staff task management and collaboration tools, applicant tracking solutions, and other HR/staffing technologies, hotels build resilience within the recruiting and staff management parts of the business. The objective is to leverage available technology to effectively track applicants and avoid letting the best candidates slip away to other hotels or on-demand work platforms. Today, hotels themselves can tap into the gig economy with next generation on-demand staffing platforms. Just like technology makes it easier for workers to find jobs, technology also helps hotels sharpen focus on recruiting and retaining top talent. As competition for workers heats up, people have more options than ever. It behooves hotels to provide a modern, sensible work environment across departments that attracts and keeps the best workers. To foster loyalty, invest in the right talent management solutions that develop your workforce. By providing opportunities for employee training and learning, hotels have a better chance of keeping the most ambitious employees engaged. Workers should be incentivized to stay through these development opportunities, as well as through a workplace that prioritizes workers as professionals. More workers turn to the on-demand economy to supplement wages and/or add flexibility to their work lives. The real-time and on-demand nature of these platforms diminishes loyalty in favor of flexibility. Office spaces shrinking, off-sites growing Another area affected by unprecedented flexibility is office space. The average square footage per employee is lower than it used to be, both due to open floor plans and the rise of remote work. Denser office spaces, coupled with remote workers, has expanded the role of hotels as destinations for off-site meetings. With less space at work, and teams dispersed geographically, more companies rely on off-sites. These events bring together remote teams in a non-office setting to accomplish concrete goals. For hotels, this means a potentially lucrative incremental revenue stream from groups. It also means more requests for proposal taking up precious staff resources for a non-guaranteed event booking. As the RFP pace picks up in 2019, hotels will turn to group sourcing and RFP tools to reduce the burden on over-taxed staff. Other technologies will further enhance hotels’ event capabilities, such as event planning software that brings efficiency and organization to the process, as well as sales platforms that aggregate knowledge and empower sales teams to sell more effectively. Data is also increasingly vital to successfully building a book of group business, with meetings and events intelligence tools growing in sophistication. Airbnb offers ultra-affordable accommodations 2018 saw an expansion of available channels for hotels. For example, Airbnb added boutique hotels to its platform, saying that it now considers itself in direct competition with OTAs. This year, Airbnb also released a meetings and events tool for corporate travel companies. These are only two examples of the growing ecosystem offering hotel bookings outside of traditional intermediaries like OTAs. The evolution of Airbnb into a full-fledged online travel agency creates pricing pressure for hotels but could also benefit hotels by breaking the Expedia/Booking duopoly that’s crippling them. The slide above shows how significant the average discount of an Airbnb is when compared to a hotel. The ultra-affordability of some Airbnb listings versus hotels will continue to influence how hotels price their rooms in certain markets. Hotels will look to rate intelligence solutions to monitor rate parity -- and may eventually even pull in Airbnb rates for a more accurate compset in many market segments. All of this data must be considered for revenue management software to make the right rate recommendations. The lower price point for some Airbnbs is also an opportunity for hotels to deliver rate competitiveness through streamlined operations. For hotels in hyper-competitive markets, technology rewards hotels with more profitable operations. The ultimate goal here is to either bring in more guests at similar prices or bring in the same number of guests at a more efficient cost structure. Bring in more guests: Price more efficiently to offer the right price to the right guest using revenue management tools. Consider contracting with a hospitality-focused digital marketing agency, as well as adding direct booking, and metasearch/ad tech tools to keep your marketing spend in high-performance mode. Streamline operations: Wasteful operations bleed a hotel’s profitability. Technology keeps costs in check. Tools for staff task management and collaboration, as well as for housekeeping management, help managers track staff performance through comprehensive reporting that identifies areas for improvement. A tighter operation gives a hotel breathing room as far as pricing and profitability. For 2019, outsource your hotel’s R&D So what do these trends mean for your hotel? Since most hotels are not in the technology business, outsource your research and development to trusted technology partners that specialize in defining and building technology. Meeker pulls together the top companies by research and development expenditures. The slide emphasizes the competitiveness of these investments; the fastest growing companies are also the ones that invest heavily in R&D. As these companies attract prime talent and continue to invest millions in exploring the applications of new technologies, there’s an economy of scale that fuels future growth. The top companies in the world by research and development. When it comes to technology, hotels don’t typically invest in research and development in the traditional sense. The outsourcing of these efforts is therefore not only sensible but imperative to compete in today’s digital economy. By investing in technology, hotels sharpen the edge in a fiercely competitive environment.