Hotel Distribution - Channels, Complexity and Chaos at Rainmaker Gaming & Hospitality Customer Conference

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An discussion of the challenges facing hotel revenue managers as hotel distribution channels become more complex and chaotic. Presentation by Robert Cole of RockCheetah to the Raimmaker Revenue Management 2014 Gaming and Hospitality Customer Conference held Wednesday, March 26, 2014 at the Bacara Resort and Spa in Santa Barbara, California.

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Hotel Distribution - Channels, Complexity and Chaos at Rainmaker Gaming & Hospitality Customer Conference

  1. 1. Hotel Distribution Channels, Complexity & Chaos Rainmaker Customer Conference March 26, 2014 | Santa Barbara, CA Image Credit: koi. | flickr (cc)
  2. 2. Hotel Distribution Challenges • Channels – OTA – Meta-Search – Brand/Property Direct • Complexity – Personalization – Adaptive Content – Advanced Analytics • Chaos – Product Transformation – Rate Parity Considerations – Total Revenue Management Rainmaker Customer Conference Hotel Distribution - Channels, Complexity & Chaos Robert Cole ● RockCheetah | 1 Image Credit: will ockenden | flickr (cc)
  3. 3. Hotel Distribution – Channels • Online Travel Agencies • Meta-Search Websites • Brand/Property Direct Rainmaker Customer Conference Hotel Distribution - Channels, Complexity & Chaos Robert Cole ● RockCheetah | 2 Image Credit: Olaf | flickr (cc)
  4. 4. 7-Step Travel Process Rainmaker Customer Conference Hotel Distribution - Channels, Complexity & Chaos Robert Cole ● RockCheetah | 3 PLANNING (How) VALIDATION (Who) BOOKING (When) TRAVEL (What) SHARING (Wow) RESEARCH (Where) INSPIRATION (Why) Image Credit: paul bica, Greything, | flickr (cc)
  5. 5. Channels – OTA Unfair Advantage? • Content Dominance – Broad Destination Coverage | Cross-brand Shopping – High Traffic | Relevant Content | Massive Ad Spend – Models – Meta / Merchant / Agency / Opaque / Package • Actionable Demand & Market Intelligence – Strong Meta-search Bidding/Conversion Experience – Deep Supplier Opaque Discounts Absorbed as Margin – Shaving of Merchant Room Occupancy Taxes • Agency Model Rising? – Lower Margin / Better Payment Terms – Ease of Cancellation / Free Option for Hedge Strategy – Increased Poaching Potential by Competition or {Gasp} Self Rainmaker Customer Conference Hotel Distribution - Channels, Complexity & Chaos Robert Cole ● RockCheetah | 4 Image Credit: Olaf | flickr (cc)
  6. 6. Channels - Meta-Search Transformation • Not All Platforms Created Equal – OTA Top Meta-search Position from 66% to 78% – Kayak: 57x Referrals to OTA v. Brand.com | TRIP: 11x – Google Knowledge Carousel Beating Hotel Finder • TripAdvisor – 2 Billion Annual Unique Visitors in 2013 – 1/3 of 150 Million Reviews Entered in 2013 – Just Wait – “TripConnect” & “Just For You” • Wallet Integration – Eliminate Keystrokes on Mobile Device – Frequency Program Integration – Pass Booking Request/Response via API v. Deep Link Rainmaker Customer Conference Hotel Distribution - Channels, Complexity & Chaos Robert Cole ● RockCheetah | 5 Image Credit: x | flickr (cc)
  7. 7. Channels – Is Direct Enough? • Fluid Website Architecture – Multiple Devices – Google: 89% Have Started One Device / Finished on Other – Responsive Web Design Dynamic - Screen Dimensions – Adaptive Web Design – Preset for Specific Dimensions • Mobile Apps – Intermediary Apps Dominating Hotel Brands – Utility Focus – Download is Useless if Never Used – Next Generation – Mobile Check-in | Contextual Offers • Call Center – Often Forgotten - Smartphones are Still Phones – Call Tracking Integration Technology – Ties Online Website Sessions to Call Center Screen Pops Rainmaker Customer Conference Hotel Distribution - Channels, Complexity & Chaos Robert Cole ● RockCheetah | 6 Image Credit: x | flickr (cc)
  8. 8. Hotel Distribution – Complexity • Personalization • Adaptive Content • Advanced Analytics Rainmaker Customer Conference Hotel Distribution - Channels, Complexity & Chaos Robert Cole ● RockCheetah | 7 Image Credit: joncandy | flickr (cc)
  9. 9. The Multiple Persona Traveler Rainmaker Customer Conference Hotel Distribution - Channels, Complexity & Chaos Robert Cole ● RockCheetah | 8 Image Credit: Greything | flickr (cc) Weather Delay Wedding Anniversary College Trip Family Visit Industry Conference Getaway with Friends Client Visit Romantic Weekend Family Vacation
  10. 10. Complexity – Personalization • Behavioral Segmentation – Multiple/Cross-Device Usage – Website Navigation – Remarketing Across Future Website Activities • Traveler Engagement – Personas Dictate Channel | Destination | Components – Preferences Largely Situational & Itinerary-specific – Common Goals? | One Night Stand v. Lifetime Relationship • Contextually Relevant Offers – Right Product|Message|Guest|Time|Channel|Price – Unparalleled Social Targeting Capability – Facebook – Who Draws The Creepy Line? The Buyer | Not The Seller Rainmaker Customer Conference Hotel Distribution - Channels, Complexity & Chaos Robert Cole ● RockCheetah | 9 Image Credit: joncandy | flickr (cc)
  11. 11. Complexity - Adaptive Content Puzzles • Programmatic Advertising – Anonymous Traveler Purchase History – Bid-based, Real-time, Advertising Exchanges – Rules Based RMS Integration Creates Real-time Offer • Website Design Considerations – Responsive Website versus Adaptive Website Design – Landing Page Design/Optimization to Convert Sale – Navigation Path to Support Persona’s Narrative • Multivariate Conversion Testing – Booking Engine Integration – Can Be a Sore Point – Not Just Best Option – Best Combination of Options – Track All Data Points – Seek Conversion Correlation Rainmaker Customer Conference Hotel Distribution - Channels, Complexity & Chaos Robert Cole ● RockCheetah | 10 Image Credit: joncandy | flickr (cc)
  12. 12. Complexity – Advanced Analytics • Integrated Analytics – Shared Social Attribution – Billboard Effect or Coincidental Visit? – Review Scores – Correlation and/or Causation? • Big Data – Too Big, Fast or Weird to Fit in Traditional Database – NOT Just Data You Control – Predictive Analytics • Death Of The 3rd Party Cookie – Apple / Microsoft / Facebook / Google Alternatives – Universal Analytics – Persistent Across Sessions & Devices – UserID – Signed In Account from Authenticated Platform Rainmaker Customer Conference Hotel Distribution - Channels, Complexity & Chaos Robert Cole ● RockCheetah | 11 Image Credit: joncandy | flickr (cc)
  13. 13. Hotel Distribution – Chaos • Hotel Product Transformation • Rate Parity Under Assault • Total Revenue Management Rainmaker Customer Conference Hotel Distribution - Channels, Complexity & Chaos Robert Cole ● RockCheetah | 12 Image Credit: scragz | flickr (cc)
  14. 14. Chaos – Hotel Product Transformation • Room Inventory Gets Personal – Airbnb / HomeAway Training Guests to Select Unit – Managing Unit-based Inventory Like Playing Tetris – Push or Pull Synchronization Challenges • Rate Plan Permutations & Combinations – Multiple Personas = Multiple Options / Eligibility – Rules-based Variable Pricing & Combinability Rules – Validation Based on Offer / Affiliation / Channel • Bundled Offers – Demand Generator and/or Value Added Pairings – Protects Retail Pricing Structure – Avoids Rate Parity Entanglements Rainmaker Customer Conference Hotel Distribution - Channels, Complexity & Chaos Robert Cole ● RockCheetah | 13 Image Credit: x | flickr (cc)
  15. 15. Chaos – Rate Parity Under Assault • United Kingdom / European Union Rulings – Illegal in Europe / OK in US – Open Game for Returning Guests with Profiles – Distribution is Virtual & Global • Returning Guests are Open Game – Redefines the Frequent Guest – Best Available Rate Guarantee Undermined – Merchant & Agency Models Equally at Risk • The Battle to Induce Trial – Lifetime Value Basis for New Customer Acquisition – Special Offers Independent of Room Rate – Meta-search Visibility Into Frequency Programs Rainmaker Customer Conference Hotel Distribution - Channels, Complexity & Chaos Robert Cole ● RockCheetah | 14 Image Credit: scragz | flickr (cc)
  16. 16. Chaos – Total Revenue Management • Acquisition Costs – Channel Advertising Spend – Staff Allocation – Important for Social Media – Cost Allocation Frequently Conversion Dependent • Distribution Costs – Channel Distribution Expenses – Are You Paying for Marketing, Technology or Both? – Fully Allocated Brand Related Expenses • GOPPAR Is End Game – Understand True Channel Profitability – Requires Integrated Spend / Traffic / Conversion Analytics – Enterprise & Highly Interoperable Solutions Win Rainmaker Customer Conference Hotel Distribution - Channels, Complexity & Chaos Robert Cole ● RockCheetah | 15 Image Credit: scragz | flickr (cc)
  17. 17. Review of Hotel Distribution Challenges • Channels – OTA – Meta-Search – Brand/Property Direct • Complexity – Personalization – Adaptive Content – Advanced Analytics • Chaos – Product Transformation – Rate Parity Considerations – Total Revenue Management Rainmaker Customer Conference Hotel Distribution - Channels, Complexity & Chaos Robert Cole ● RockCheetah | 16 Image Credit: 3[3] | flickr (cc)
  18. 18. How Do Revenue Managers Survive Thrive? • Embrace Complete Hospitality Vision – Old School – A New “Location, Location, Location” Paradigm – “Life is Service” & “Guest is Always Right” – When Herd is Culled – Old / Weak / Those Unable to Adapt • Total GOPPAR Management – Break Through Marketing / Web / Advertising / CRM Silos – Segment Granularity Down to Persona/Itinerary Basis – More Signals from More Sources – Big Data Gets Real • Surviving in the Intersection During Rush Hour – Guest Segment: Traveler Persona & Itinerary Goals – Product Offer: Destination Experience & Breaking Rules – Business Success: GOP Capture v. Lifetime Guest Value Rainmaker Customer Conference Hotel Distribution - Channels, Complexity & Chaos Robert Cole ● RockCheetah | 17 Image Credit: HJ Media Studios | flickr (cc)
  19. 19. Hotel Distribution Channels, Complexity & Chaos Hang On, It’s Going to Be a Bumpy Ride! Thank You Robert Cole phone: +1.262.309.9560 social media: @robertkcole email: robert@rockcheetah.com Rainmaker Customer Conference Hotel Distribution - Channels, Complexity & Chaos Robert Cole ● RockCheetah | 18 Image Credit: ::hap / flickr (cc)

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