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Hotel Revenue Management Software Articles

How to Kill Your Hotel: Price Rooms in a Spreadsheet

by
Hotel Tech Report
5 days ago

Remember what happened to those taxi cabs who doubled down on fixed pricing structures when Uber launched?  In a few short years the entire industry has experienced upheaval and for most the classical idea of a taxi is nothing more than a hazy memory with a touch of nostalgia.  When your revenue managers run fixed rate pricing like those taxi drivers did there’s only one thing that is certain - they are burning cash. With dynamic pricing, hotels can maximize occupancy, optimize room offers to specific consumer segments, and respond to fluctuations in supply and demand efficiently. Ultimately, dynamic pricing leads to better yield management. But, dynamic pricing is nearly impossible without the use of a Revenue Management System which empowers hotels to master dynamic pricing. Revenue Management Software (RMS) uses analytics to automatically determine the best price for hotel rooms, depending on demand and a variety of other factors. Tools like IDeaS G3 RMS have the capability to process 100 million revenue-enhancing decisions each day across 1.6 million rooms, processing data into a revenue strategy that maximizes profits. Every hotel needs a revenue management system to sell the right room to the right guest at their maximum willingness to pay and at the moment they’re looking to book. Here are just five reasons why every hotel must employ dynamic pricing with a revenue management system.   Hotel inventory is perishable and there’s a clear capacity constraint There are a certain number of rooms available at any given time. With a fixed capacity, the goal for your hotel manager is to fill as many rooms as possible at the best price possible. Price too high, and your rooms will remain empty. Price too low, and you’re missing out on revenue, impacting your bottom line. A revenue management system can help you price your rooms based on your guests’ willingness to pay. For example, someone booking well in advance is likely looking for a lower price. For guests booking during popular dates – around a holiday or major event – they know to expect higher prices. The crazy part of it all is that most of the time the data is inexplicable.  Supply and demand are constantly surprising revenue managers and oftentimes we’ll never even know why even after the fact. That’s where an RMS comes in. Revenue management systems like IDeaS G3 Revenue Solutions provide these insights to inform your pricing to maximize profit and occupancy. IDeaS G3 allows revenue managers to yield by room type: so when there’s a spike in demand for suites, the system automatically increases the price for suites, but not for double rooms. This is a more advanced way to manage pricing beyond just seasonality and peak demand. Expand the attributes or rules used to adjust rates depending on price sensitivity and other factors.   Hotel pricing is fluid and elastic Supermarkets are the proverbial canary in the coal mine when it comes to mastering dynamic pricing. Their experience in integrating dynamic pricing offers lessons for hotel owners to replicate. Over the last 10 years, the supermarket industry has adopted digital price tags to cut down on perishable inventory waste and benefit from increased sales. Digital price tags empower the retailer to effect 90,000 price changes per day, capturing the most value from their stock based on foot traffic and supply constraints. In Germany, the ability to manipulate price based on perishability and demand has led to 2.5% increase in revenue and a 30% drop in waste.  Hotels can learn from this example. When hotels use a revenue management system, managers are able to price rooms and other services in such a way that minimizes waste.  Streamline operations by understanding how your pricing model is likely to impact bookings and the guest segments that will book during a certain time period. For example, pricing to attract families will necessitate different services (shuttles from the airport, fully-stocked snacks) than pricing to attract business travelers (room service, laundry, and dry cleaning) - this is total revenue management and good luck to any revenue manager who tries to predict tRevPAR or contribution on a booker who they’ve never met. One hotel property noted that IDeaS’ revenue management software provides quick updates so he can make decisions in real-time, saying the tool is “very user-friendly, updated on a regular basis in line with market changes and also feedback from clients. You also have the ability to use the system through an app on your phone, giving access when on the move.”   There’s seasonal demand in almost every market, but that’s only the tip of the iceberg Seasonal demand exists in everything from e-commerce to food and beverage – but seasonality is particularly impactful to pricing for hoteliers. Demand during a peak season can dramatically change a customer’s willingness to pay. Take, for example, how Amazon prices Pumpkin Pie Spice from one season to another. During the spring and summer months, this spice is sold normally for $4.49. But closer to Thanksgiving and Christmas, the spice sells for as high as $8.49. A revenue management system can predict for you when the peak seasons will hit, and give you the insight you need to maximize your revenue without turning off customers. While seasonality might seem obvious, it’s the critical shoulder periods that are almost impossible to price right. During these critical shoulder periods your property is inevitably losing cash and can’t afford to go more in the red without risking a property visit from lenders.  Seasonality is just the start, there’s event driven demand and so much more that it’s almost impossible to keep track of let alone factor into your decisions without the proper revenue management tech.   No matter how good your revenue managers are, they can’t do these calculations on their own There are a number of factors and data points a revenue management tool takes into account when recommending the pricing structure for your available inventory at any given time. For your management team to perform the same calculation, they would need the following information – and many more data points:  Past historic occupancy rates and forward-looking data for demand forecasting Available rooms Labor and acquisition costs  RevPAR Index and competitor data Historic and current ADR A revenue management tool like IDeaS G3 is fully equipped to deliver the right product, priced attractively, to the right customer on the channel they’re using. “Automated solutions simplify the complex and transform data into precise pricing and forecasting decisions hotels can count on.” Dr. Ravi Mehrotra, IDeaS Co-Founder Revenue management software is far more efficient than trying to have a team member crunch the numbers and update pricing on the fly.    Yield management software pays for itself in spades Dynamic changes in your rates have a big impact on your final numbers. When you improve your average daily rate by just $5, that money goes straight to your bottom line. Revenue management systems basically lead to straight profit: there’s no additional cost to acquire or service the guest, and you’ve optimized your pricing in a way that improves occupancy and revenue. IDeaS’ pricing model factors in prices by day or length of stay. It allows hotels to price within a range or set of price levels for certain attributes. This type of holistic optimization leads to improved yield management – inevitably, the tool pays for itself (and then some).

So You've Got a Great Hotel Website, Now What?

by
Hotel Tech Report
5 days ago

It’s a best practice in the hotel industry to update your hotel’s website at least once every two to five years. A hotel website design refresh alone costs a minimum of $2,000-$5,000 and up to $30,000 for a premium custom hotel website. For websites more than three years old, material technical updates need to be made to keep the guest booking experience (UX) running smoothly which in turn improves everything from web visitation metrics like time on site which then impact SEO and even paid advertising. Beyond just putting a fresh coat of paint on your hotel website, hotel owners need to make sure the page loads quickly, the site is mobile-optimized, and that it has a high conversion rate. These updates can be pricey, but worthwhile. The site needs to be structured for optimal SEO rankings, with updates to keyword research integrated regularly. New content should be added to the site to keep the page looking fresh and showcase anything new happening at the property. Above all, the page needs to work well, deliver a great booking experience, and improve the visibility of the hotel so guests can find and book their perfect room easily. It’s an investment to keep your hotel’s web presence in peak condition. Updating your hotel website is just the first step, however, to increasing direct bookings and improving the profitability of your property. Here’s what to do once you’ve optimized your website.   Optimize pricing to attract more prospective guests Our first priority as a hotel marketer is always ensuring that we have taken steps to optimize our direct channel.  Once our website is optimized we want to make sure that we are pricing our rooms correctly relative to the compset. Enter: market intelligence and rate shopping software. A rate shopping tool gives you the data you need to make an informed decision on pricing. For example, RateScreener integrates market rates and event calendar data to provide the best possible pricing for supply and demand at any given time. Tools like this one can monitor competitor rates using local event and weather data, demand models, and historic trends. Automating this process is one of the most important things you can do after you upgrade your hotel’s website. All of these steps are crucial to optimizing marketing strategies. And, fortunately, there are many great marketing tools out there that can connect you with more channels, optimize your pricing, or help you manage your reputation. However, working with one vendor to deploy all these marketing tactics has more advantages than working with multiple vendors. Work with one vendor to utilize your resources effectively by streamlining your contracts, managing your budget, and integrating your reporting   Use paid acquisition to maximize your website investments Now that your website is set up to convert better and rooms are priced correctly, there are three marketing plays you can use to increase direct views of your hotel’s webpage.  Metasearch advertising refers to advertising on sites like TripAdvisor or Kayak. These metasearch sites are consolidators of OTAs like Booking.com & Expedia; the key difference is that the online travel agent contracts directly with a hotel to sell their inventory. A metasearch site, conversely, does not contract with a hotel. Metasearch sites account for more than 45% of global unique visitors in travel. This makes them extremely popular; bookings made through an ad on metasearch are less costly to hoteliers than a commission-based OTA booking. Because there are so many metasearch sites out there, you need a tool that makes it easy to manage bidding on a variety of complex platforms like TripAdvisor. Metasearch management software, like MetaGenius, is a good solution. MetaGenius can manage TripAdvisor, Google Hotel Ads, Trivago, and Kayak all in one intuitive dashboard. Metasearch management software gives your hotel a way to maximize reach, thereby attracting new guests and improving profitability. Hotel search engine marketing (SEM), or paid marketing, involves purchasing traffic to your website through paid search listings. Put money keywords that you’ve added to your website to increase exposure of your hotel site and add more guests to the booking funnel. Where SEO, or organic search, is something that will increase your traffic over time, SEM is a quick way to validate your keywords and content and make sure you’ve optimized your site for what your customers seek. Lastly, deploy display advertising and specifically remarketing – purchasing banner ads on Google or social media – to reach new audiences or re-target those who visited your website previously without completing the booking process. This powerful method of marketing can help bring customers back into your funnel – only now, your user is visiting a more fully-optimized site that is likely to convert to a sale.  Given how many websites a traveller browses during the booking process remarketing (or retargeting) is one of the most profitable forms of paid acquisition. There is a slight catch, however, you have to get them to your website first.   Improve your hotel’s online reputation to pre-empt sales challenges Regardless of how pretty your hotel website is, inevitably guests will fact check your claims on third party review websites like TripAdvisor.  In the hospitality industry, reputation is everything: 95% of guests read reviews prior to making a booking decision. Besides price, other guest reviews are the most important pieces of information a user accounts for when it comes to booking a room. Reputation management software paired with a well-designed, fully optimized website can drive direct bookings, improve guest satisfaction, and increase revenue. At a minimum, a reputation management tool should be able to: Aggregate reviews from multiple channels (OTAs, guest satisfaction surveys, and other review sites such as Yelp). Provide visibility at an enterprise level for multiple properties Analyze sentiment by scanning reviews for keywords to provide insight into the overall positive and negative aspects impacting ratings Benchmark against competitors to see how your property performs relative to the market. Managing your reputation is the next phase of optimization. A great digital marketing agency can help promote your brand but even the best digital marketing agencies can’t help a property who’s known for a low quality guest experience. Online reputation management tools like D-Edge Sentinel drive brand visibility through SEM and direct link campaigns. Sentinel aggregates reviews from OTAs, social media, and metasearch in many languages and across countries to show hoteliers what their guests are saying. The dashboard uses a proprietary algorithm that adapts to reviews over time, suggesting keywords to use in targeted campaigns and providing insights on areas where your hotel might improve.   Add more distribution to augment your direct channel Tiny hotels that cannot afford a hotel website often focus on third party channels alone.  This is a dangerous strategy; however, it is one employed all across the world. These hotels merely focus on optimizing inventory and third party listings to drive demand.  Most of these hotels will leverage a channel manager to expand its visibility and reach a broad online audience, manage rates, availability, and reservations in real-time, and connect to a variety of distribution channels.  The benefits of using a channel manager can significantly improve your bottom line. For hotels who already have a great website, adding channel management capabilities is a strong strategy.  With a baseline of direct bookings coming in from their brand.com channel, a channel manager can help augment those bookings to fill strategic needs. Tools like Smart Channel Manager manage rates and room availability on hundreds of channels saving hotels time and helping to facilitate more efficient inventory allocation. Channel management software increases your occupancy by listing your property across OTAs and GDS channels from one centralized location – thereby reaching travelers all over the world. Room listings and availability are automatically updated by the tool to improve occupancy rates and maximize profits. When exploring a channel manager tool, look for the software’s reporting capabilities, pooled inventory, the number of channels the platform can connect with, and system integrations.     If you’re looking for one vendor who can cover everything from reputation management to pricing and channel management, D-Edge is definitely worth a look. D-Edge provides end-to-end solutions that streamline your marketing technology stack. It’s a great tool for managing your entire marketing stack all from one streamlined platform.

5 Upsell Techniques to Explode Your RevPAR

by
Hotel Tech Report
5 days ago

Airlines made nearly $93 billion on ancillaries in 2018 -- this fact foreshadows the imminent opportunity for upselling in hotels. Needless to say, ancillaries are a massive opportunity for hotels. With resort fees attracting the attention of regulators, it’s an ideal time for hotels to pursue ancillary revenue streams that add value to the guest’s experience. Unlike resort fees, upsell offers don’t increase revenue at the expense of guest satisfaction.  On the contrary, serving personalized and relevant offers in stay has been shown to improve guest satisfaction. At the same time as they enhance the experience, these add-ons are profit drivers for hotels -- and give hotels leverage to capture more of a guest’s travel spend for a given trip. OTAs have become masters at selling more to each customer and thus earning more of a consumer’s travel spend for a given trip. They deploy tests in real-time, and apply learnings continuously to upsell more to each consumer. So what can hotels learn from airlines, OTAs, and other savvy organizations? Upselling is a discipline, and with patience, creativity, and technology, anyone can become an expert. As hotels capture a greater share of bookings direct to brand.com, it’s imperative to develop an upselling discipline. Guests expect it and your bottom line demands it. Yet, it can be challenging for smaller hotels and regional chains to deploy an upselling strategy that fully leverages data, creativity, and technology. That’s where these 5 upselling techniques come in. To illustrate these upselling strategies, we’ll be using Oaky, Hotel Tech Report’s top reviewed upsell software for hotels. These techniques can be applied for anyone looking to enhance the guest experience through more relevant, segmented, and targeted marketing.     #1: Integrate well to automate well Ancillary offers should be integrated across customer touchpoints. The first step to success is to integrate your upselling tool with your CMS and PMS. Integrations provide up-to-date and accurate guest and reservation data to populate the rest of the upselling process. When data flows without interruption, hospitality marketers can confidently create offers that are primed for conversion. And then it's all about automation! By eliminating manual data entry and the need to set and send campaigns, upsells are way more effective. After all, you can’t upsell anything if you forget to send a campaign! With data integrated correctly, hotels can capture, share, and act on data with little-to-no intervention! Automated and integrated upselling works like this. When a guest books a room that room gets logged in the PMS. Oaky is notified of the booking via a one-way connection with the PMS and sends a pre-stay email to the guest including special offers (e.g., a room upgrade). The hotel must then manually approve the request and adjust the reservation in the PMS.  However, a two-way connection allows the property to automatically approve requests in real time, modify the reservation, and quickly move guests into premium rooms. That interconnectivity also removes the manual labor at the front desk that is required to approve requests, freeing up more time for staff to focus on the thing that differentiates their property most—the guest experience. Oaky uses a timeline to determine the best marketing sequence before and during the guest’s stay. Once the solution is set up and fully integrated into the existing workflow, it takes over. At set intervals along the guest journey, it automatically sends out personalized messages promoting room upgrades (10 to 21 days before arrival) and other ancillary services (3 to 5 days before arrival). Oaky’s timeline for populating guest communications with relevant and timely upsells.    #2: Personalize intelligently with segmentation You'll annoy your customers (and sell less) if you pester them with multiple pop-ups, pressure them to buy, or suggest irrelevant add-ons. It really comes down to humanizing the upsell by using segmentation to personalize more intelligently. And it’s not just that consumers expect personalization. Some are willing to pay for it:  “36% (over 1 in 3) would pay more for more tailored information and experiences.” -Google Traveler Study The good news is that travel and hospitality are doing a fairly good job at meeting those expectations head-on: 63% of communications in our industry cater to individuals with some form of personalization. That’s not bad! Personalized communications is rapidly becoming a best practice in hospitality marketing. As you start to build your segments, consider targeting for both behavior and events. That way you can use past customer experiences to tailor upsells with precision. Some examples: Length of stay IP address Returning guests Interactions with previous campaigns Market code Rate code  Job title or employer Abandoned cart   Savvy hospitality marketers also must consider targeting based on a guest’s native language. It’s no good if the offers don’t translate into words that make sense for the guest; even if the booking engine is localized, offers often aren’t. This causes confusion and makes it difficult to see healthy conversions from upsells. Keep localization in mind throughout your upselling journey, as it will impact the types of offers guests prefer as well!  Make sure to leverage hotel email marketing best practices to execute your upsell strategy.     Oaky’s dashboard makes it dead simple to switch languages for emails and in-app communications.   #3: Match guest with the right offer and sell well The best upsells should improve the guest’s experience. Think of it more as surgical precision rather than scattershot randomness. It should provide that segment with a clear value. In short: relevancy is the goal! The first step is to choose the right products. To do this correctly, One of the most obvious and useful segments is business versus leisure. A 2018 Phocuswright report analyzed which ancillaries appeal to which business traveler demographic. The results reveal a breakdown of opportunities for upselling to business travelers, all based on their demographic preferences. Stay attuned to these preferences, refer to your own engagement statistics, and always strive to make the best match of product to segment!     Next, it’s essential to promote them well. It’s not enough to simply place ancillaries on a screen and cross your fingers. You’ll need to craft compelling marketing copy, choose a vibrant image, and price the product well. Show the guest that you understand their needs and humanize the offer in a way that connects the offer to the guest. If an upsell is chosen correctly and positioned well, then many guests won’t mind spending a bit more for a dramatic improvement in the experience. Sell the benefits of each product and show them what’s in it for them -- how it will make the stay better. Then, thanks to automation, the product will upsell itself, consistently and automatically!   Oaky suggests some standard offers to get you started in building an upsell engine for your hotel.    #4: Recognize loyalty -- even without a loyalty program In the U.S., 72% of online consumers are members of a loyalty program, and 69% of those consumers “find special treatment important.” Yet that desire extends only so far in hospitality: “two-thirds of U.S. elite hotel loyalty program members would pick a different hotel for a better price. Loyalty is no longer assured. This makes recognizing repeat guests during the booking flow even more important. Knowing a past guest’s stay history helps predict which potential upsells or other perks may work best. It’s like empowering hotels with a superpower: soft loyalty that recognizes and rewards repeat guests with more personalized offers.      #5: Finally: Use your data! A test and learn mindset works wonders for improving your upselling conversion rates. Be thoughtful and intentional, and look beyond your rooms to leverage restaurants, spas, on-site amenities, and in-destination partnerships. Here are some ideas to get the juices flowing: Partner with local makers to make shoppable rooms and common areas Collaborate with an up-and-coming chef (from your property or elsewhere) to offer cooking classes Partner with a luggage shipping service to offer door-to-door luggage transfers A welcome package with local sweets, followed by a visit to the local chocolatier during the stay Once you set up a pilot to test these upsells, you’ll gather valuable engagement data about what works, what doesn’t work, and for whom. You can use your data to evaluate experiments, track performance and evolve your approach over time. Repeat this cycle a few times, and you’ll not only understand what engages your guests, but you will see stronger performance. Which, of course, means more revenue!

Who are Hotel Tech's Most Inspiring Female Founders?

by
Hotel Tech Report
5 days ago

Female entrepreneurship has seen a staggering amount of growth in the last 40 years. As of 2018, the US had 12.3 million women-owned businesses, compared to 402,000 businesses in 1972. Today, women-owned ventures make 4 out of every 10 businesses within the US, a shift that has altered the landscape of female leadership. Even traditionally male-dominated industries, such as tech, are being disrupted by female founders and leaders. Women in the travel technology space are solidifying their leadership and paving the way for their younger counterparts to find their way in this growing industry.  While not a founder, Booking Chairwoman Gillian Tans is arguably the most powerful woman in travel tech.  She shares wisdom with budding female entrepreneurs and leaders: “The advice I would give to anyone starting out is to take risks and not be afraid of new challenges or opportunities. My career path was not obvious, I had to make many twists and turns along the way to get where I am today. It required taking some chances. But those were the moments where I learned the most. Without challenging yourself, growth opportunities are limited. So take the risks. You will be better for it in the long run, regardless of the short-term outcome." Without further adieu five of the travel technology industry’s most inspirational female founders, and how they forged their way to the top.   Robin Deyo, Cendyn Robin Deyo is co-founder of the global travel tech company Cendyn. With over 30 years experience in hospitality, Robin began her career on the sales side for Hyatt Hotels Corporation and Red Rock Resorts. In 1996, she and her husband recognized a hole in the market and co-founded Cendyn, a SaaS marketing, sales and event solutions platform for the hospitality industry. Cendyn enables hotels and hospitality groups to leverage data and drive guest loyalty in a secure and compliant way, while cutting down response times and offering personalized service. Cendyn’s foundational product, eProposal, was one of the first solutions to allow hotels to accept group business RFPs via their websites, thereby growing their group business. eProposal still makes up a small but important part of Cendyn’s overall portfolio today. Cendyn is the leading hotel CRM platform with over 30,000 customers across 143 countries, offering products that incorporate sales software and hotel digital marketing services with enterprise spend levels in excess of $1 billion. In June 2019, private equity firm Accel-KKR purchased a majority stake in Cendyn. Robin and her husband have taken a backseat in the day-to-day operations of the company. Robin has recently started De Joux Holdings, a company focused on investing in hospitality-focused and philanthropic projects. It will certainly be one to watch to see what exciting new paths this industry veteren will take next.   Alexandra Zubko, Triptease  Alexandra Zubko founded Triptease in 2013. Since then, it’s become one of the industry's fastest growing tech upstarts. One of the biggest issues facing the hotel industry has been the rise of online travel agencies. OTAs cut off the direct connection between hotel and customer and obscure room data for hoteliers, creating rate parity issues and making profitable pricing more elusive. Triptease increases direct bookings by making the booking process easier. Triptease: Attract is a metasearch management software that aims to drive an additional 10% of direct revenue to hotels at a lower cost than OTA commissions. Triptease: Convert is a direct marketing tool that flags a hotel’s most valuable guests, offering ways throughout the entire customer journey to make sure they book directly with the hotel. Triptease’s cloud-based software and real-time pricing tool give hotels increased ownership on how rooms are priced. Triptease was the top-rated Direct Booking Platform in 2018. Alexandra was VP, Head of Global Strategy at IHG (Intercontinental Hotel Group) prior to co-founding Triptease. She had her first taste of start-up life – in between working at consulting giants McKinsey and Goldman Sachs – as the founder of TripTips, an online social networking platform for sharing travel recommendations. For more on her background, check out our exclusive interview with Alexandra about her career journey and vision for Triptease.   Allison Page, SEVENROOMS Allison page comes to hotel (and F&B) tech with a finance background and a bachelor degree from University of Pennsylvania's prestigious Wharton Business School. Allison and her co-founder Joel Montaniel founded the business in 2011 and haven't looked back since raising more than $21M in funding to date. Hotel food & beverage operations often lack the resources and know how to run personalized marketing campaigns. SevenRooms’ segmentation and email automation enables F&B managers to easily add customizable tags to guest profiles then run rules based marketing campaigns to those segments.  Run unique marketing to critical segments like: first timers, high value regulars, positive reviewers and more. Companies like Revinate and Cendyn have demonstrated the immense value of personalized hospitality marketing campaigns.  Now F&B outlets can benefit from marketing automation too.   Janine Williams, Impulsify Janine founded Impulsify as a retail technology solution for hotels. Impulsify equips hoteliers with customized retail technology solutions to maximize impulse sales in hotel pantries and gift shops through a POS and inventory management solution.  Hotel front desk teams see a reduction in front desk retail traffic by up to 90%, enabling guests to get what they want when they want it.  Based in Denver, with 29 employees, Impusify was named top rated Lobby Technology in the HotelTechAwards. Janine takes any opportunity to fuse travel and giving back. Recently, she launched a campaign to donate a whole house to a family in need for every 50 hotels that added ImpulsePoint POS to their pantry or gift shop. Janine regularly travels to Honduras to build schools, clinics, and houses for those in need. It’s hard not to be inspired by the incredible female leaders that are finding success and bringing innovation to the travel tech industry. We are seeing unprecedented support for women’s empowerment within the workforce, turning what was once a barren wasteland for female leadership opportunities into a fertile ground for growth.   Tammy Farley, The Rainmaker Group Tammy co-founded The Rainmaker Group in 1998 where she spearheaded all sales, marketing, and customer-related operations for the company. Rainmaker is a market leader in profit optimization solution for hotels, resorts and casinos. Rainmaker has three key products: revintel, guestrev, and grouprev. The proprietary guestrev revenue management tool optimizes room rates to reflect guest’s spend across an entire property enabling properties to plan revenue goals and set rates based on demand. Grouprev helps hotel owners convert group and meeting business and maximize revenue. The tool optimizes group room rates, function space revenue, and manages a property’s sales and catering calendar. Revintel is a tool that aggregates and analyzes data to produce actionable insights to drive revenue and help site managers measure performance against corporate goals.  The Rainmaker Group was recently acquired by industry tech giant Cendyn (yes, that's the same Cendyn founded by Robyn Deyo above!) to help round out their digital offerings. Tammy will become a board member and continue her heavy involvement in local philanthropy.   Amanda Szabo, ResortPass Amanda Szabo is a serial entrepreneur and founder of Los Angeles based ResortPass.  The firm has raised $12.7M in funding to data according to data from pitchbook and has its sites set on global expansion.  In hyper competitive markets finding new hotel guests is expensive and difficult. Travellers are notoriously hard to market to which led Amanda to realize that hotels were missing the lowest hanging fruit around - locals. With that insight Amanda created ResortPass to sell day passes where locals (or guests at other hotels) can use luxury hotel amenities when they're not a guest.  ResortPass works with hotels like the W Hollywood and Viceroy Santa Monica and leverages a congestion-pricing model similar to Uber to ensure that those amenities don't end up getting over crowded for guests while ensuring that hotels achieve maximum profit.  This is one of those ideas that everyone says "how did this not exist before" but Amanda took the reigns and is executing like crazy to bring her vision to life.   Jennifer Wong, LaaSie.ai (formerly Stay Wanderful) Jennifer comes to hotel tech with a finance and real estate background, a bachelor's degree from MIT and an MBA from Harvard Business School. Jennifer founded LaaSie.ai in 2016 under the name Stay Wanderful).  The start-up uses Instant Gratification to power the transaction moment (i.e. booking on a hotel website) in a more relevant way for today's consumers. LaaSie.ai leverages a unique approach to loyalty by providing personalized incentives and perks, such as free Uber, Amazon credits or VIP access.  The platform can increase direct booking conversion and retention by leveraging an ever growing network of premium national & local merchant rewards alongside its AI technology. LaaSie.ai (under its former name Stay Wanderful) won Top Direct Booking Platform in the 2019 HotelTechAwards. The Company also won the Most Innovative - Judge's Choice Award at HITEC 2017 and of the Best Business Model Award at Launch Festival 2016.

These Are the 5 Hottest Cities in Hotel Tech

by
Hotel Tech Report
5 days ago

Success for any startup is a blend of luck and skill, peppered with grit and resilience. It takes a methodical approach to pull together a team with exceptional skills to execute on an idea that solves a real problem for a well-understood customer. Even in a world of remote work, it also helps to be surrounded by knowledgeable advisors with industry expertise and a supportive community that can be tapped face-to-face. This is especially true in hotel technology, a tight-knit community that thrives on relationships. Of course, success is not solely dependent on location. However, clustering near other related businesses can rapidly increase your chances of success. A strong local network fosters better industry relationships that can shorten lead times on the sales side and accelerate development cycles on the product side.  That’s because the right locality puts you closer to your customers, which helps with getting actionable feedback quickly, and closer to potential investors, which accelerates momentum in rapid growth phases.  Proximity can also bring you the types of talent that underpin some of the 10 Best Places to Work in Hotel Tech. Cities with clusters of industry- and trend-specific companies give you better chances of finding the right talent for your business -- especially since former employees often go on to start their own startups that solve problems in the same industry, such as with Arise Travel. We’ve done a little legwork to help you discover some of the most vibrant and active places in the world to headquarter your hotel tech startup. With an active community familiar with hotel technology, depth of local talent pool, and a global mindset, these are our top five cities for travel technology.   London: Focus on Business Intelligence and Hardware London is an ideal place to take advantage of Europe’s diversity, as well as its relative closeness to the financial centers of New York. And, in spite of the looming Brexit, London remains itself a financial powerhouse. That means a dense concentration of global capital, coupled with a workforce details from countries all over Europe and beyond. With London's six airports, alongside train connections to most of Europe, London's location is ideal for startups looking to situate Themselves at the gates of Europe -- while still remaining as close as possible to the Americas. London also has the Traveltech Lab, a hub for travel technology startups that focuses on fostering a community of “innovation, collaboration, and creativity” that connects “technology startups with big corporates within the travel industry.” The dedicated space and organic community can be a boon to startups as they look to establish themselves, build a product, and grow their business. Hotel tech companies based in London: SiteMinder’s guest acquisition platform combines powerful optimization and analytics tools to capture more direct bookings for hotels. The company has greatly expanded its Exchange, which features dozens of integrations that make its guest acquisition tools even more useful for its 35,000 hotel and property manager clients.  While the firm will always call Sydney its home base - they've got a big presence from the London office. Mews is the backbone of hotel operations. Founded by a former rising star at Hilton, its property management system is the top-rated solution on HTR, and its kiosk, mobile check-in, and hotel app solutions are all highly rated by customers. OTA Insight is a “new breed of hotel tech company” that empowers hoteliers to fight against rate disparity, benchmark their own rates against competition, and leverage market intelligence to optimize revenue. The company’s newest feature gives hoteliers the ability to rate shop across different points-of-sale in order to monitor for regional differences in rate parity. Crave’s interactive tablets enhance the guest experience by putting property information, ancillaries, and in-room technology and messaging at guests’ fingertips. Thanks to industry-wide integrations, the tablets fold seamlessly into existing operations. Clock Software’s property management system combines crucial features, such as reservations, housekeeping, and channel management, as well as a robust API, into an all-in-one tool lauded by hoteliers. Case in point: Hoteliers votes Clock Software as a top PMS in the 2019 HotelTechAwards. Triptease is designed to return control of distribution to hotels. From acquisition to conversion, its direct booking platform merges metasearch advertising, parity monitoring, website widgets, and revenue management into a cohesive. Just last year, the Company earned an accolade as a top place to work in hotel tech. Pace reinvents revenue management with its “booking curve” approach to forecasting demand. The “intelligent revenue management” system alerts hoteliers to any unusual patterns to booking curves for each night, room-category and segment.  Fornova is a great example of London companies focusing on business intelligence: the company helps hotels monitor and benchmark distribution, as well as analyze market and property-level intelligence with HotelsBI and optimize pricing via its eCommerce Optimizer.  Iris Tablets offers hardware for guest rooms via its tablet technology. Its software also sets it apart: the cloud-hosted Guest Experience Platform (GXP) increases revenue, reduces costs and successfully improves the end-to-end Guest Experience for over 3000 hotels and restaurants worldwide. eRevMax is known for its pioneering channel manager and rate shopper RateTiger. Its latest product LiveOS turns “chaos to clarity” by smashing silos and pulling data from disparate systems into one dashboard to support real-time decisions.  Impala tackles a critical problem for hotels (and vendors serving hotels): how to integrate systems that don’t integrate themselves. Software providers can run a simple JSON script to integrate their products with those of other vendors in hospitality thus unlocking a new market.   San Francisco: Focus on Big Tech Silicon Valley has long been home to Big Tech. And even though the area has long since become less affordable than other cities the region’s reputation continues to attract ambitious entrepreneurs and world-class workers. The competitiveness is a double-edged sword: It can be costly to hire the best talent here, and investors quite literally have the cream of the crop. It can be a struggle for startups to both find the best people and raise the necessary capital to thrive. For these reasons, Silicon Valley has become home to larger hotel tech companies that serve the hospitality industry worldwide. These companies can compete effectively for talent, and take full advantage of the regions saturation of startups. San Francisco is also an interesting place for workers who eventually want to do their own startup: rich networks of talent and capital are useful at the seed stage as well. Hotel tech companies based in SF: Revinate’s CRM and email marketing software helps hotels develop long-lasting relationships with guests through targeted marketing, personalized campaigns, and deeper guest insights. Highlighting the value of being near other companies in the vertical Revinate recently announced a partnership with SF-based Duetto to allow hotels to use Duetto to price upsells dynamically in Revinate. Duetto is a full-stack revenue management technology. The company‘s Revenue Strategy Platform optimizes revenue and profitability across channels. This singular focus on total profitability underpins Duetto’s philosophy of Total Revenue Management. Sojern helps hotels marketers segment audiences and identify the best channels to advertise on. The company, which recently celebrated its 12 year anniversary, moved into new offices last year to accommodate its continued growth. Frontdesk Anywhere is a complete hotel management software suite that facilitates the guest journey from the initial online booking process through arrival, onsite operations and checkout.  Autoclerk serves hotels with property management and central reservation systems as well as a booking engine. It’s an end-to-end solution for booking guests, managing reservations, and operations. In a surprise move, BestWestern is the new owner of Autoclerk and promises to continue investing in the platform. MS Shift solves several operational issues for hotels: concierge management,  luggage tracking, front desk management, asset tracking, and maintenance/engineering management, among others.  Salesforce is the granddaddy of enterprise technology. It's fully-customizable CRM and sales software is widely used in the hospitality industry.  HelloShift is an easy-to-use messaging platform that enhances communications among staff as well as between staff and guests. With its combined approach Helloshift can become a hotel’s communications backbone. The company was recognized as the top staff collaboration platform in the 2018 HotelTechAwards. Medallia is a Customer Experience Management company that solves the problem of uneven feedback: it’s not easy to gather customer feedback across online and offline and transform them into something relevant and useful. Suiteness has an unexpected take on hotel bookings: it offers only suites. The value proposition extends to groups as it also empowers travelers to book connecting suites so that groups can stay together. Suiteness integrates with DHSCO and SynXis to expand access to the unique inventory.   Amsterdam: Focus on the Booking.com Alumni and Partner Networks Amsterdam is another great European city from which to base your hotel tech startup.  Data from Startup Europe found that Amsterdam’s share of Europe’s venture financing was EUR 1.67 billion. Amsterdam also has an added advantage: It's the home of globally-recognized behemoth Booking Holdings. The company, best known for Booking.com, employs thousands and will soon move into a high-profile new headquarters building. The steady growth of the company means that there is a sizable local population with the knowledge of travel and hospitality. The population is also highly fluent in English, which makes Amsterdam a city with solid international bon afides. Hotel tech companies based in Amsterdam: HotelChamp is a website experience and marketing optimization tool for hotels. When deployed on a hotel’s website, the toolset boosts direct bookings by adding a layer of personalization and segmentation. The latest tool, called Autopilot, leverages millions of data points to optimize a website in real-time.  Oaky unlocks pre-stay up selling so that hotels can offer room upgrades and other products prior to arrival. The solution improves profitability-per-booking before a guest even arrives on property. Oaky was awarded the top upselling and merchandising solution at the 2019 HotelTechAwards. 4Suites solves the keyless entry problem for hotels. It's smart access technology simplifies hotel operations, reduces costs and upgrades the guest experience. iReckonU sits at the core of your hotel’s tech stack to pull in data from other tools to reveal new insights and to enrich guest profiles. This “guest experience framework” improves the efficacy of marketing while also putting operations closer to guests. Hoteliers.com combines all distribution channels into a single view which reduces complexity and increases control for independent hoteliers looking for an affordable-yet-powerful channel manager. Olery solves reputation management for hotels. The system captures reviews from over 100 channels, and pulls them into a single interface for hotels to handle quickly and efficiently. It also has an analytics and marketing component to give hoteliers tools to improve and promote its reputation. Olery’s latest report dives into reputation in the Middle East.   New York City: Focus on Marketing NYC is a fantastic place to run a hospitality technology startup. The city has one of the highest concentrations of hotels in the world, which puts your startup close to many potential customers. The city is also one of the global hubs for media, which may have something to do with the over-indexing on start-ups with a hospitality marketing focus. New York is also home to Voyager HQ, a hub for a global community of travel and hospitality tech startups. The co-working space is home to many startups in the industry and often hosts meetups and networking events that provide a solid base for its startup community.  As European companies hit scale they tend to make New York their first foray into the U.S. market as evidenced by Triptease and Mews Systems both sending their founders overseas. The flight between NYC and London is pretty manageable and so is the time zone - what better launchpad for world domination? Hotel tech companies based in NYC: Travel Tripper provides distribution and marketing support to everyone from small independents to major brands.  Hotels looking for an all-in-one marketing partner should look no further since the firm has it all: Booking Engine, CRS, Digital Marketing Services and Hotel website development.  With freshly infused Accel-KKR capital Travel Tripper merged with Pegasus and now provides additional business intelligence and GDS services. InnRoad is a popular property management system for small properties and boutiques. HeBS recently rebranded as Next Guest with the integration of Serenata Intraware’s CRM technology.  While Serenata remains run out of its Germany headquarters NY provides the mothership and HeBS’ bread and butter is still digital marketing. TravelClick was recently acquired by publicly traded travel tech behemoth Amadeus and while Amadeus is run out of Spain, we imagine that it’s New Hampshire based hospitality division is going to get a little FOMO when they see their sister company’s New York City digs. Volara provides voice recognition software to hotels solving for the challenges of systems integrations and cyber security - giving hotels the ability to install turnkey Amazon and Android devices in their rooms. ALICE was one of the first company’s in the market to “make hotel tech fun again” lead by marketing guru Alexander Shashou and technical savant Dmitry Koltunov - the firm is an unstoppable force in the hotel operations space. LaaSie.ai (formerly Stay Wanderful) is a lesser known direct booking platform providing a network of merchant partnerships that can be leveraged to increase hotel website conversion and ultimately drive more direct bookings.  LaaSie recently rebranded and similar to Travel Tripper above was originally funded by NYC based Highgate Ventures. SEVENROOMS is a restaurant software company that provides CRM and guest management services to dozens of hotel restaurants around the world. Bizly is a meeting booking platform that helps corporate meeting planners find the best venues for small breakout meetings (i.e. hotels). Los Angeles/San Diego: Focus on Messaging Long known as the entertainment capital of the world, LA has emerged as a tech hub in its own right. Part of this is due to its status as a (slightly) more affordable option for SF startups. Another part is due to the convergence of technology and entertainment; as more startups emerged to build technologies underpinning next-gen entertainment, it naturally created a local base of tech talent. Another reason for the rising popularity of southern California as a technology hub? Clearly it's the weather! But the preponderance of sunny days, many weather-weary San Franciscans and New Yorkers have made the move. By the influx, the city intense relative affordability compared to cities of the same size and scope. Coupled with the great quality of life, southern California has become quite the contender on the global tech stage. Socal is an hour flight to both a hotel hub and tech hub, Las Vegas and Silicon Valley respectively. Hotel tech companies based in Los Angeles/San Diego: INTELITY’s guest engagement platform bridges across departments to connect staff with guests across text, voice, and digital channels. The company also offers an hotel operations platform for staff management, That includes recorder and task management, as well as analytics. INTELITY recently merged with KEYPR to expand its reach and reliability worldwide. Cloudbeds provides a booking engine, channel manager, property management system, and revenue optimization tools for independent hotels, boutiques, B&Bs, and hostels. The comprehensive hotel management solution was named a finalist for the People’s Choice Award at the 2019 HotelTechAwards. Whistle’s guest messaging technology simplifies communications so that staff can respond to messages in real-time from a single dashboard, regardless of whether the message is an email, website chat, or text message. For the second year in a row, Whistle earned the top spot as the #1 messaging platform on HotelTechReport. ResortPass has raised more than $12M to help hoteliers grow revenue by selling premium access to luxury amenities like the pool and spa during off-peak hours.  The Company is based in Santa Monica and works with top tier hotels like the Viceroy Santa Monica and W Hollywood. TrustYou While they are headquartered in Munich, Germany, TrustYou set up shop in San Diego, CA back in 2014 in order to better serve the growing US hotel industry. Their 10 local employees support functions across all facets of the company including Business Development, Account Management, Client Success, Finance, and Marketing. Zingle is a messaging platform that connects guest and staff across channels and devices so that communications is always streamlined and never siloed. The company recently announced AI-driven Intelligent routing that analyzes a guest’s intent to intelligently (and automatically) route guest requests to the right department or person. GuestBook Rewards is a loyalty program for independent hotels. Guests have a choice of cashback, credits for a future trip, or a charitable donation -- an incentive model that sets GuestBook apart from its competitors.  The program has become the largest network of independents, with over 600 member hotels in 55 countries. GuestCentric gives hotels control over their revenues by solving the guest acquisition problem: with a CRS, a digital agency  The company was a HotelTechAward finalist in 2018. JDA Software’s revenue management solution solves the revenue management problem for hotels. Thanks to an advanced forecasting engine that includes consumer intent and price sensitivity, the software increases revenue and boosts margins. Clicktripz is a monetization platform for publishers. Using proprietary ad-serving technology, Clicktripz’s targeting and granular bidding means that publishers can efficiently monetize audiences by connecting them to suppliers and advertisers. Kallpod is a service tracking solution that encourages guests to call for service right from their table. Kallpod Pro extends this functionality with customizable buttons, a two-way interface for staff to talk to each other, and a data platform to assist with more intelligent staffing.

Airbnb is the Best Thing That's Happened to Hotels in a Long Time

by
Hotel Tech Report
5 days ago

Airbnb is considered public enemy number one by hoteliers all over the world. But, is Airbnb’s reputation deserved? Research based on data from 2014 showed that in the ten US cities with the largest Airbnb market share, 1.3% fewer hotel nights were booked, resulting in a 1.5% loss in hotel revenue. Over the last five years, those losses have continued to add up. By one estimate, Airbnb is capturing 10-12% of travel demand in New York City, Paris, and London. Airbnb’s financial impact on the hospitality market is a hard pill to swallow. But, there’s actually a silver lining. Smart hotel owners can benefit from listing on Airbnb with a little strategy, effort, and the right channel manager. It turns out that Airbnb is the best thing that’s happened to hotels in quite a while. A good channel manager should enable hoteliers to easily manage inventory across channels like Airbnb.  Efficient inventory management across channels can increase occupancy, improve reach and visibility, efficiently manage rates, availability, and reservations. Channel managers like SiteMinder give hoteliers what they need to capitalize on Airbnb. Here’s how you can leverage Airbnb to elevate your hotel’s profile and reach more guests.   How do hotels benefit from Airbnb? There are direct and indirect ways in which a hotel can benefit from Airbnb. First and foremost, by listing on Airbnb, a hotel can increase their short-term bookings. Several hotels in the Hotel Tech Report community have reported that Airbnb is now delivering up to 15% of bookings. Airbnb gets a very high rating for brand advocacy, an indicator of customer loyalty and repeat customers. Guests not only return to the Airbnb platform to make another booking – but Airbnb guests will also refer other customers at a higher than market-average rate. Hotels can take advantage of high affinity on Airbnb to connect with a broader, more engaged customer base (relative to OTAs).  Perhaps the biggest of trends in the hotel industry over the last decade has been the consolidation of OTAs.  Beyond the short term direct benefits of including Airbnb into your hotel marketing strategy there exists a major long-term advantage of listing your hotel inventory on Airbnb: relief from OTA commission fees. OTAs like Expedia and Booking.com charge massive commission fees – between 15-30% for larger hotel chains, and even higher for smaller hoteliers. Airbnb is a third major player that can bring more competition to the market. The end result? Hotels will inevitably benefit as high-charging OTAs are forced to lower their prices to compete for listings. The OTA market has become somewhat of a duopoly so adding a strong 3rd competitor is actually a really good thing for hotels in the long run which is why we encourage hotels to list on Airbnb using a channel manager connection like SiteMinder. Listing on Airbnb is a win-win for hotels and for the platform. Airbnb needs hotels to stock their platform with desirable inventory. And, more importantly, guests – especially millennials – prefer to stay in hotels over Airbnb homes. “Customers appreciate the consistency of experience guaranteed by booking a stay at, for example, a Marriott hotel anywhere around the world,” writes Forbes. “But they need to differentiate their offerings. Not every room should be the same cookie-cutter mold at the same price. They should have a modicum of personality, and a diverse set of amenities, from fully-stocked kitchens to second bathrooms to common spaces and more.”    Want to fight the negative effects of Airbnb? List on it.  If you can’t beat them, join them: smart hotel owners are capitalizing on Airbnb by listing their hotel inventory on the platform. Channel managers that have a direct connection to Airbnb, like SiteMinder, make it easy to compete with hosts, managed properties, and other hotels for bookings.  “There is a huge opportunity to ace the guest journey end-to-end. I think the in-stay experience has traditionally been the sole focus for hotels, as it’s what they’ve always had immediate visibility and control over, but of course we know that the journey began long before the guest arrived and continues long thereafter – if it ends at all. The explosion of data and technology has made it possible for hotels to understand their guests in a way they’ve never been able to before, and it’s an opportunity I think most hotels are missing,” says SiteMinder CEO Sankar Narayan. Airbnb’s user-friendly platform gives hotels the chance to get their offers in front of guests at the right moment in their room search. The more accommodations that list on the platform, the less likely each listing is to get attention and convert interested browsers to paid guests. This works out in favor of hotels, which can crowd out hosts and alternative accommodations. To some extent, this is already happening: unhappy Airbnb hosts are already complaining about the number of big-box listings shown in search results.   Airbnb host commentary on the impact of hotel listings (source: Airbnb)   Inevitably, a larger mix of hotels will lead to the erosion of Airbnb’s reputation as an alternative way to stay. As guests perceive Airbnb on par with traditional OTAs and booking agents, we also expect the platform will be regulated as such. More regulation for Airbnb means a more level playing field for hoteliers – just another indirect bonus to listing your hotel on the platform.    A channel manager help you manage visibility across critical channels like Airbnb Channel managers can do more than just empower a hotel to list open rooms on Airbnb.  “At its core, a channel manager creates a two-way connection between a hotel’s property management system (PMS) and that hotel’s chosen marketing and sales channels, be they online travel agencies (OTAs) like Expedia, metasearch sites like Trivago, wholesalers, tour operators, travel agents and even their own hotel Brand.com website. It literally connects the hotel’s PMS to those channels, so property owners can instantly and simultaneously distribute all their rooms on the Internet, and have reservations delivered back to them just as fast,” says SiteMinder’s Director of Product, Gregor Vogel. A channel manager allows a hotel to reach new customers, improve their online visibility, and proactively manage rates, availability, and reservations. Tools like SiteMinder provide access to hundreds of online distribution channels so hotels can list all their rooms and availability while automatically updating in real-time whenever a new booking is made. At the same time, a channel manager prevents hotels from becoming overbooked by tracking inventory across OTAs and all third party channels. What’s the best channel manager technology for your hotel? These are the key things to look for in a channel manager: Does the channel manager offer two-way channel connections? Does the channel manager connect to all of your current and new channels? Does the channel manager allow you to pool inventory to maximize your revenue?  Does the channel manager integrate with your current CRS, PMS, and RMS? Does the channel manager have reporting tools that allow you to concretely measure its impact? If the answer to each of these questions is yes, then it’s highly probable that the channel manager has the basic functionality your hotel needs. Evaluate each channel manager tool based on its distribution, analytics, and ability to provide consistency in real-time across all channels. Last but not least: keep in mind how much training and support the channel manager offers. Learn what training is available, how much it costs, and whether or not it’s offered in your time zones and languages. There’s no use in spending money on a tool that your employees find impenetrable.    How to get your hotel listed on Airbnb Ready to join Airbnb and start selling? The fastest way to get started is by working with a channel manager like SiteMinder to manage rates.  Airbnb has specific guidelines for hotel listings to get approved. First and foremost, your property must have the right business licenses and be legally authorized to sell directly to the public. Then, your listing must meet Airbnb’s basic requirements for hosts as well as the additional hotel listing guidelines mostly around hotel property type.  Airbnb has an innate bias towards unique independent boutiques but has been known to allow all types of hotels on the platform, especially since the Hotel Tonight acquisition. As Airbnb describes, your room listings should “have a unique, independent environment and style.” Take time to go through the listing process and set up your channel manager to optimize your listing on Airbnb.

How to Improve Hotel Profitability with Rate Parity Data

by
Hotel Tech Report
4 days ago

There are many industries where third party reseller issues present a profitability and liability problem. Even Amazon is forced to contend with marketplace reseller issues,  where federal courts ruled in an “unprecedented” decision that customers can hold the e-commerce giant financially accountable for defective products sold by third-parties. The hotel industry has bigger third party profitability issues than retail and other verticals. Hotel rooms are sold through third parties, specifically online travel agent (OTA) sites, more than any other industry. OTAs entered the market in the mid-nineties and since then have grown to take 39% of the US online digital booking market. This number is expected to climb to 41% market share by 2020. Selling on OTA channels significantly dents the profitability of a hotel for a variety of reasons. A dynamic pricing model that responds to fluctuating supply and demand mandates that hotels use quality, up-to-date data. There is an overwhelming amount of data hoteliers need to manage in order to respond to the market’s supply and demand fluctuations. PMS data can provide insight to the following questions:  Market segmentation: what segment of the market does each reservation fall under?  Rate code: which PMS price code is attached to each reservation?  Distribution channel: which distribution channel was used to make the reservation? Location data: where is the guest traveling from?  Day of the week stay: which days of the week are being booked most commonly? Length of stay: for how many room nights is each reservation?  Lead time: how far in advance is the reservation made?  Company: is the reservation linked to a company with a negotiated rate?  Agency: which travel agent made the reservation? However, pricing needs to be informed by market intelligence data as well: everything from competitor data (revenue per available room, occupancy rates, and average daily rates from STR) to event data (i.e., when a local concert is in town or an airport terminal is being renovated). Rate parity data is the most critical touchpoint, offering a comprehensive view about how your hotel is selling on third-party channels. This data set is necessary for profitable pricing – yet many hoteliers struggle to get the full picture they need from OTAs and other third party partners.  Non-contracted OTAs obfuscate the data needed for a hotel brand to profitably price their rooms. Parity is also impacted by contracted OTAs who charge commission fees between 15-30% for larger hotel chains; sometimes higher for smaller shops. Here’s how parity works (or doesn’t work) in the hotel industry, and how smart hotel owners can begin to approach the data problem.    What is rate parity?  Rate parity, or disparity in the case of the hotel industry, is the difference between prices quoted on a hotel’s branded website versus the prices quoted by an online travel agent such as Booking.com. When online travel agents first appeared on the scene, they were considered a promising new channel for hotel brands seeking to offload excess inventory in the off-season or reach customers through new and different advertising. However, as OTAs have become more popular, many hotel owners no longer see this relationship as a win-win: mostly due to parity issues. There are two main scenarios where rate parity gets thrown off, mainly due to the way the hotel ecosystem has evolved to account for online travel agents. Here’s a snapshot of what the current booking marketplace looks like:  “Hotel Rate Parity: Understanding and Meeting the Challenges” by OTA Insight (source)   Hotels, wholesalers, search engines, and OTAs are the main players in the “parity landscape.” As OTAs capture more and more market share, each relationship is impacted financially. Contracted OTAs, those agents that work directly in a commissionable or direct net merchant agreement with a hotel, cause parity problems usually through technical issues. For example, tax miscalculations or other outdated “cached” data can throw off a pricing model despite the OTAs aboveboard commitment to parity with the hotel. Non-contracted OTAs that have a relationship with a wholesaler present a bigger problem. Hotels offer an exclusive “gated” rate to a third party reseller. That reseller turns around and unofficially resells rooms at that gated rate to a party who lists that rate publicly. This forces the hotel to pay a high commission for rooms that sell at a much lower rate, losing tons of profit in the process.  The problem of rate parity is only becoming more serious. Travelers are constantly comparing rates across channels – especially Millennials and Gen Y, who hold the largest travel market share at 33% of the market. When you consider that 52% of Millennials prefer to book using an online travel agent, the problem becomes clear.  “Customers are much savvier these days. I had a guest contact us on our website directly to ask, 'Is this the best deal you can give me? We are trying Airbnb as well'. We had that same guest going through Airbnb to see if they could get a lower price, and then they also went to the extended-stay agent. And this customer was actually part of a very big international company; they had a contracted rate with the hotel as well. The guest had all these different ways to contact the hotel and get the best rate possible,” says Jennifer Kim, the Director of Revenue Management at Cycas Hospitality.    How to solve the rate parity problem The good news is there tools that hotels can deploy to solve the rate parity problem that arises from working with OTAs. Great rate shopping software should not only deliver real time competitive set intelligence but should also alert hotel owners when there are parity breaches. “The basic mechanism involves wholesalers contracting inventory at a big discount and selling it on to OTAs at a discount which still leaves room for the OTAs to undercut hotels,” says Clive Wood, Global Commercial Manager for Parity Insight at OTA Insight. “But it’s surprising how unaware some hoteliers are about what’s happening, day in, day out when guests book through the many channels out there. Just how much of their revenue is being threatened?”  Rate shopping software, like Rate Insight by OTA Insight, shows how your direct competitors are pricing hotels rooms. Additionally, OTA Insight's Parity Insight product highlights channels that violate parity agreements. Hoteliers can use this information to react swiftly to unauthorized resellers, remedy parity discrepancies, and improve profitability by utilizing data that was previously unavailable. Both rate shopping and parity management platforms are easy-to-implement due to how they leverage publicly available data; this means there’s no integration with your existing software to work though. There are many rate shopping tools out there that can map a hotel’s rooms, define competitive sets, and deliver reports to improve pricing decisions. In the past, we’ve highlighted a few of our favorites such as OTA Insight's Rate Insight tool which really stands out with it's integrated BI platform and parity monitoring system to give you a full view into the areas of your business that require attention. “One of the things that makes OTA Insight unique on a technical level is that we collect over 1 billion data points a day,” says Mathias Verhoeven, Director of Engineering at OTA Insight." Hoteliers can’t sleep on solving the threat to hotel profitability posed by working with online travel agents and unauthorized resellers. OTAs are only becoming more popular with travelers looking for the best deal out there. Therefore, it’s incumbent on hotels to take charge of their data and lock down pricing parity in their favor.

An Exclusive Interview With Katherine Grass of Thayer Ventures

by
Hotel Tech Report
4 days ago

One of the major proponents of the alternative lodging sector has been Thayer Ventures, a travel tech focused venture capital firm with deep ties to the hotel industry. Thayer’s focus on travel and hospitality gives the firm a unique perspective so we sat down with Venture Partner Katherine Grass to discuss hotel tech, the rise of alternative lodging and more.  Katherine previously founded Amadeus Ventures and has met with literally thousands of startups in the space over the years - she’s seen it all and has unparalleled insight into the alternative accomodation trend. How did you get into travel tech venture investing? I started my venture career at Amadeus IT Group where I founded Amadeus Ventures and went on to build out an entire ecosystem of programs working with external players and created their global Innovation & Venturing unit. Ventures had always been my first passion - aiding startups to be successful. Therefore, when the opportunity arose to join Thayer Ventures, Thayer being the leading travel-technology fund globally, I naturally jumped at the idea! Thayer Ventures is unique because we are not only one of the few travel-technology focused funds globally, but all partners come with a very deep expertise and network in this space. Therefore, we are not only able to make solid investment decisions based on our industry expertise, but we are able to truly help our portfolio companies, whether that be with industry contacts, strategic direction or business development. What hotel and hospitality tech companies have you invested in? Being travel-technology focused, we have many hospitality tech investments in our portfolio. Mews Systems, Optii Solutions, HYP3R, Sonder, BookingPal, Duetto, Groupize and Social Tables are examples of hospitality tech investments. Social Tables recently being sold to Cvent. While Dishcraft Robotics and xx are additional investments that apply to the hotel sector. How do you usually come across hotel tech investment opportunities? Because we are one of the leading funds in travel technology, we have a combination of companies reaching out to us, referrals from other generalist funds looking for a travel-tech expert as well as directly discovering startups at major events. Most of our investments tend to be Series A and we will absolutely lead rounds where it makes sense. What’s one piece of advice you have for hotel tech entrepreneurs when raising capital? Hard to pick one piece of advice! My advice would be to ensure you are addressing a real business problem in the industry. You would be surprised by how many startups develop ideas for concepts that aren’t seen as real pain point opportunities by the hotels. Additionally, ensure your opportunity has a big enough addressable market. This means there is enough profit to be made by your idea if you’re successful. Small opportunity means small profits, and you won’t get investors attention with this. How do you think the hotel technology space will change over the next 5 years? We will definitely see the hospitality tech stack open up and be more interactive. This means open APIs and the ability for various pieces to interact with each other and not necessarily all be from the same vendor. On alternative lodging, we still have massive growth in this sector and we will see this continue over the next 5 years. People often say that the hotel industry is slow to adopt technology. Do you agree? I don’t agree. We have seen hotels becoming increasingly open to quick experimentation and pilots, and as solutions become more cloud-based and API-led, it will only increase. Some legacy systems made this testing more difficult in the past due to the integration effort required for experimentation, but we are definitely seeing this change. What is the most interesting or surprising thing that you’ve learned from investing in hotel tech? An interesting trend we are seeing in the hospitality tech space has been the continued growth and strength of what we call alternative accommodations. For all of the startups that might want to pitch in your office, what can you tell them about your investment criteria, etc. to help them decide if they are a good fit for your portfolio? We are looking for stellar teams. Most all of our investments are Series A, meaning the startup already has some initial traction and customers with strong growth potential. Are investments are global but must be in the space of travel-technology. For us this means hospitality tech stack, alternative lodging, tours & activities, corporates & meetings, smart cities and mobility & transportation.

5 Reasons Why You Need Triptease's Direct Booking Platform

by
Hotel Tech Report
4 days ago

Distribution is a costly expense for hotels. Each time a booking is made through a third-party, commissions must be paid throughout the chain of distribution. While it’s convenient to capture demand from these channels, it’s not always clear that the commissions paid are worth the bookings received. The question of value is especially pertinent given that most hotels pay more for commission then they have in the past, per Kalibri Labs data: Kalibri Labs data from 19,000 hotels worldwide shows how much more hotels spend on distribution since 2015.   The stark reality of rising distribution costs has led many hotels to broaden their metrics from the simple RevPAR to NetRevPAR, which adjusts for distribution costs within top line results. To deliver stronger profits (and not just greater booking volume), hotels must deploy a comprehensive direct booking strategy that pulls more bookings away from those third parties.  One hospitality technology company in particular has stepped up to the challenge with a comprehensive set of direct booking tools: Triptease. “Paying large commissions for valuable guests is over. Identify and reach your highest-value guests first with a platform that works across the booking journey - from acquisition to conversion - to make sure they book directly with your hotel.” ~Triptease Triptease initially began as a price check widget on hotel websites and has since evolved into an end-to-end guest intelligence platform.  Today Triptease helps not only improve hotel website and booking engine conversion rates but also helps hotels bring more prospective guests into the top of the funnel with tools that improve the ways they market on 3rd party channels like OTAs and metasearch platforms (e.g. TripAdvisor). The company’s website optimization tools then convert those guests more often with personalized offers, notifications and even website live chat. When used in combination with a hotel’s existing marketing efforts, these tools are a powerful driver of direct revenue. Here are 5 reasons why hotels need Triptease’s direct booking tools to boost business in the direct channel.     #1: Attract the most valuable guests to your hotel website With intelligent audience acquisition, hotels get more of the right customers. Triptease’s platform ensures that your hotel reaches the most valuable guests first. With its metasearch ad tool, Triptease’s system identifies and prioritizes high-value guests for conversion. The tool promises to “bring the right guests straight from search” so that your advertising spend can be targeted to the guests most likely to convert. The secret sauce here is that Triptease aggregates and analyzes your hotel’s data to calculate a precise bid amount. The tool adjust bids according to the potential value of a stay, as well as that individual guest’s likelihood to book. To get to this ideal bid, Triptease uses two different systems: the Guest Value Index, which judges how the guest’s purchase intent compares to your hotel’s ideal customer profile, and the Trip Value Index, which is calculated from the booking’s qualities, such as parity and overall booking value. Hotels stand to gain a lot from these calculations: Triptease Meta aims to drive metasearch traffic that pays for itself with an additional 10% of direct revenue for hotels. More guests at a lower cost drives profitability for hotels, which is the core value proposition of Triptease’s guest intelligence platform.    #2: Convert more lookers to bookers The goal of attracting more guests, and converting them more often, is driven by Triptease’s focus on transparency and trust. Thanks to blanket discounts and “Only X rooms left!” messaging, there’s a lot of mistrust and skepticism around hotel search. Triptease works to build trust by letting guests know that they’ll get the fairest price on the direct channel.  The Triptease Price Check Widget shows guests how much that same search would cost on three OTAs. The popular tool provides price transparency and boosts trust with guests. Rather than pretending like guests weren’t shopping around, the Price Check Widget calls attention to it by giving guests the confidence to book direct. Triptease has expanded on the widget with a full suite of conversion tools. Now, the platform includes non-price offers, such as offering a value-add bonus for booking direct, as well as highlighting recent searches and essential information about a hotel’s location. In total, there are thousands of messages across multiple content types that hotels can use to convert lookers to bookers. Messages can also be personalized dynamically to different types of guests, so that hotels can best target message to demographic. This intelligent targeting improves conversion.   #3: Compare rates and track parity The Disparity Dungeon sounds like a terrible place to be. And that’s by design. This Triptease feature ensures that your hotel is priced competitively compared to your comp set -- and that your rates are in parity across your distribution channels. By monitoring parity often, hoteliers can make sure that guests always get the best rates when booking direct. Triptease has also recently expanded to include wholesalers here so the tool aids hotels with often-contentious wholesaler relationships. While there are certainly standalone tools for tracking rate parity, such as OTA Insight, there’s an advantage to packaging it into a direct booking platform: namely, ease of use. It’s right there within the same tool, so there’s no need to click away to another login screen. This ease of use also extends to format: Triptease provides regular weekly emails that identify surge events and other trends. By understanding when and where parity is changing, hoteliers can identify issues without necessarily having to watch parity daily. For those that want to monitor disparity in real-time, there’s a live feed of every search on your website that’s being undercut by an OTA. Hotels can also opt into instant alerts for parity violations. Armed with this information, hoteliers can identify the patterns and root causes of rate disparity. They can then use the documentation provided by Triptease to bring parity issues to their account reps at major OTAs that assist in the negotiation process and ultimately can help lower commissions or drive more bookings over the long term. #4: Assist your customers with live chat In its bid to be the “everything” store for direct bookings, Triptease has recently added live chat to its platform. Chat keeps the guest’s attention and gives hotels a clear path to capture bookings. Hotels can reach out directly, answer questions, and generally be accessible. The chat interface is optimized for mobile, making it easy for your reservations team to connect directly with guest’s in the channel they prefer (which is increasingly mobile).    There’s also an automated component to the chat tool. The Triptease automated AI chatbot also answers the most frequently asked questions to instantly assist guests. The automated live chat can also check availability and take payment details right in the chat interface. By removing pain points, the path to purchase is smoother and more likely to convert.   #5: Know what works with OTA-level data OTAs promise not just bookings. They also promise a level of data that’s hard to beat, especially for hotels that don’t necessarily have a sophisticated data capability in-house. Triptease turns this on its head by providing OTA-level data on who books direct, where they come from, and who they are.  The Insights Dashboard gives hotels all the necessary numbers to build a direct distribution channel that works for their own unique situation. The analytics provides complete visibility into hotel performance, as well as broader industry benchmarks for comparison. That type of granular, interaction-level data is comparable to what OTAs leverage to make more money for their own channels. Hotels can compete using their own data, and maintain a healthy (and growing) direct distribution channel.      Pricing and getting started with Triptease Triptease prices packages depending on which products a hotel wants, as well as the scale of the hotel’s needs (for example, multi-property applications). As far as implementation and setup, there’s not a lot required of hotels to get started. Hotels will need to add some code to their websites to support specific products. The most complex part is connecting the Triptease platform to existing data sources to power the hotel-level insights. Triptease offers extensive coaching, so it’s not just providing software but also the knowledge layer and long term partnership for amplifying direct bookings. Triptease has a global team of Direct Booking Coaches available to assist hotels of all sizes. From digital marketing to website optimization, data analysis, and product training, these coaches apply their regional expertise ensure ongoing success for partner hotels.   To get started with the Guest Intelligence Platform, schedule a demo with the team right from the Triptease Hotel Tech Report profile.

6 Must Listen Podcast Interviews For Hoteliers Interested in Tech

by
Hotel Tech Report
4 days ago

1. FOSSE creator Dave Berkus uses lessons from history to predict the future of hotel technology Listen now >   2. Freehand Creator and Angel Investor Roy Alpert on Using Technology to Create Revolutionary Hotel Brands Listen now >   3. Former Sabre Strategy Chief: Hotel Tech in Emerging Markets, Cyber Security in the Hotel Industry and the Future of GDS Listen now >   4. Cendyn Chief Sales & Marketing Officer, Tim Sullivan Talks Artificial Intelligence, Hotel Technology’s Place in Web 1.0 and Why Everyone is Wrong About the OTAs Listen now >   5. Triptease Founder Charlie Osmond Tells All: How his tech startup got into 12k hotels, raised $20M in venture funding and beat a $65B company Listen now >   6. Former Ruckus Wireless VP of Hospitality Ted Watson Discusses the Recent $800M Acquisition, Major Trends in WiFi Connectivity and the Critical Role HTNG Plays for Innovation Listen now >