Hospitality Upgrade – Spring, 2013

Consider this: The vast majority of reservation phone calls, whether to a call center or the hotel directly, are preceded by a visit to the hotel’s website. The caller often knows the hotel’s room options, amenities and available rates. So why do they call? In this article we play the devil’s advocate and suggest it was because the website failed them, and failed the hotel.

Failed? Yes. The caller was unable to find the information he or she was seeking, was uncomfortable about reserving online, or was unsuccessful in their attempt to book a reservation. The website failed to fully satisfy their shopping and booking intentions. As a result they needed to take the extra step of making a telephone call (and we can only guess how many potential guests opt to book elsewhere rather than make that call). This is not the guest service standard we aim for.

The website also failed the hotel. The hotel (or brand on the hotel’s behalf) invested in a website aimed at not only informing its visitors but converting those visitors to booked guests. Adding insult to injury, the hotel, brand (or both) incurred the labor costs of handling the telephone call.

Recognizing the problem – in this case the shortfall of the website – is step 1. Step 2 is correcting it. And there is good news. Every one of the reservation telephone calls gives hotels the opportunity to learn where the current information on the website is insufficient to answer site visitors’ needs, where the booking process confused them or where it did not allow the booking process they wished to complete.

  • Did they want to know the hours of Room Service, the distance to the nearest drug store, whether a baby crib would be available? Maybe this information was already on the site but its location was insufficiently apparent or maybe it had never been added to the property descriptive information.
  • Did they want to reserve two rooms (a king-bedded room and a double/double for example) and not understand how to do so?
  • Did they become confused about how the booking process flows or the need for what appeared to them to be unnecessary information?

Hotels can expand or clarify the information on the website, clarify the site’s layout, or improve the reservation creation process if they understand what it is insufficient, or where improvement is needed. The key is to learn from reservation callers and then take action. But how should hotels do that?

Hotels learn by building a feedback process in which they collect information from the people who answer reservation calls at the hotel reservation office or in the brand call center and communicate that information to the property and brand staff who are responsible for website content and website design. Making this learning a reality takes a process that will be used by everyone who answers reservation calls.

Whenever a reservation caller mentions that they visited the hotelsite and either says that they could not find the information they were seeking or could not complete their booking, or it become apparent during the conversation that this was the case, the staffer will send a brief email with a standard message subject such as “Website Problem” to a specific individual or email address. The recipient of these messages must be responsible for researching the information that was absent from the site and forwarding it to the person/team who make property information update or, if it was a booking process issue, forwarding the information to the website design group.

Operating properly, this feedback process will result in the website information being continuously expanded and clarified and, over time, will result in a clearer, more successful website design.

Yes, reservation calls are a failure of the website. They are also a learning and guest service improvement opportunity as well.

JOHN BURNS is the president of Hospitality Technology Consulting. He can be reached at < a href=”mailto:John@burns-htc.com” John@burns-htc.com or by phone at (480) 661-6797.


Not so long ago reservations from electronic channels – principally the global distribution systems – arrived routinely.  The process was one of ‘rip and re-enter’ – typing bookings in the hotel’s property management system or in the manual future reservations file.  Weekday and weekend rates changed once a season, hotel availability was open or closed.  Terms like rate parity, channel management, last room availability, and best available rate (BAR) were not in our professional vocabulary.

Fast forward to the present and the world of hotel inventory management and pricing optimization is a much different place.  The most senior staff at the property are now closely involved in distribution and pricing decisions, the brand or hotel website is the preferred reservation creation venue, but it battles for users with online travel agencies.  Competitive rate shopping services and adoption of revenue management techniques (and sometimes revenue management technology) prompt near-continuous examination and frequent adjustment of each day’s room rates.  New sales outlets – many within the social media universe – demand evaluation and the investment of time, money or both.

In the midst of all of these options, activities and unrelenting performance pressure, hotel reservations and revenue staff still need to make decisions, fill rooms and meet their property performance goals.  In this operating environment with its pervasive sense of urgency the objective I suggest, is fundamentally to strike a balance between the innumerable opportunities and the need to successfully control the hotel’s core asset – its guestroom inventory.  In essence the balance is between “opportunity” on the one hand and “control” on the other.

Opportunity comes in innumerable, ever changing and not necessarily “hotel friendly” forms.  Opportunities demand identification, evaluation and selective use. One day’s successful opportunity adoption may not be productive the next month or even the very next day.


In the real world of hotel operations, the central challenge is to reduce the number of activities, options and priorities to a manageable number.  Doing so allows effective prioritization, planning and execution.  With the calliope of distribution channels crying for every hotelier’s attention, clustering distribution options can aid in that option rationalization.  Dividing them into three broad categories may be helpful: traditional, new but likely to endure, and probably transitory.

Traditional Channels

An array of long-established channels deliver reservations to hotels day in and day out.  Many of these have been present for so long that they become largely invisible as hoteliers grapple with issues related to their websites, online travel agencies and social media.  These channels are naturally but unfortunately undervalued and overlooked in managing hotel and lodging brand distribution programs.

The most significant of these low profile, but still vital, channels is typically referred to as the global distribution systems (GDS).  Consisting of Amadeus, Galileo, Sabre and Worldspan and used primarily by corporate travel agencies, these systems continue to deliver some 50 million hotel reservations annually.

In the traditional channels category the GDSs are joined by wholesalers, legacy tour operators, and SMERF group organizers, plus callers to central reservation centers and to the hotels directly.  In total these sources deliver an appreciable portion of every hotel’s business. Their old shoe familiarity and reliable production has led to less attention being given to these sales channels – in many cases most clearly apparent in their out-of-date and insufficient descriptive information.  This disturbingly common overlooking of obsolete descriptive data has a silver lining.  That is the competitive opportunity gained by the hotels who assign a bit more attention than do their peers to these reservation sources.  The payoff is higher booking production volumes.

Hotelier challenge: Ensure that GDS and other legacy channels’ descriptions of the hotel, its rooms, facilities and amenities are both up to date and appealingly phrased in order to maximize the potential of these still productive reservation sources.

New But Likely to Endure

In addition to the traditional sales channels, a number of comparatively recent arrivals – adolescents in the distribution spectrum – vie for hotel attention and resources.  These are important additions to the lodging reservation landscape and merit thoughtful evaluation and attention.  Let’s begin with the most significant one, your own website, be it hotel.com or brand.com.

The hotel’s or brand’s website is critically important to the never-ending objective of filling hotels.  It is the best tool for developing an enduring relationship with the traveler.  Recognition can be given through personalization, offers consistent with the frequent traveler’s status can be offered and convenience tools (such as traveler profiles) can be provided.

Hoteliers should be positioning the hotel or brand website as a core sales asset.  Finding examples of terse two line (rather than enticing five-to-seven line) room descriptions, the same photo used for several (or all) room types – or no room photos at all – or out of date information about promotions or activities months (or years) ago is fundamentally inconsistent with the site’s priority assignment.  Hoteliers regularly look at competitors’ websites.  With surprising frequency, that same diligence fails to be applied to their own sites.  While many hotel websites are very decent, a few stellar – there are too many where travelers reserve despite, not because of, the website’s presentation of the hotel.

Hotelier Challenge: Do not simply believe that the descriptive data on the primary website is as up-to-date, extensive and appealing as possible, but to ensure this to be the case.

In a perfect world all Internet environment reservations would be created on the hotel or brand website.  Travelers would receive the recognition that communicates their importance as customers, offers would be suggested, add-ons proposed, customer service delivered and relationships cemented.  This perfect world is not reality and never will be.  Emerging in the same timeframe as hotel and brand websites, online travel agencies would prove to be astute competitors to the lodging industry’s direct sales efforts.

Travelers are shoppers – and shoppers prefer different styles of purchasing such as brand direct, in the supermarket, from discounters, from bundlers and some prefer different shopping styles for different trips direct to brand for business travel, for instance, and using a “discount” option for leisure reservations.

To be visible, available and at the end of the day, to fill the house, hotels must offer their accommodations not only through their directly managed websites but through a variety of other – sometimes seemingly competitor – websites as well.  Hoteliers must select the most appropriate and productive websites through which to offer guestrooms and then managing day-to-day participation in an efficient manner.  This becomes an on-going exercise in recognizing, categorizing and evaluating the distribution options.

The most disruptive, perplexing and, from time to time crucial addition to the hotel distribution picture in the past thirty years has been the emergence of a new automation-based, Internet-enabled generation of wholesalers, now broadly termed the online travel agencies.  Arguably the hotel industry has been fortunate through the decades to maintain an environment where sales resellers’ services were gained in a retail business model for a 10% commission rather than in the much more common wholesale commerce model where required price reductions are substantially greater.

An evolution of pre-Internet lodging wholesalers such as 1-800 Hotels, the largest online travel agencies gained visibility and first captured appreciable market share in the months and years following the events of 2001 and the 2002 recession.  They reminded a reticent public of the excitement of travel while convincing the lodging community that much-needed guests could be gained in exchange for significantly reduced room rates.   A crucial element in the sales message collectively articulated by the OTAs was that they offered the best value (i.e. the lowest rates) for hotel accommodation as well as for other travel services.

The OTAs presented what became a continuing conundrum for hotels – offer those OTAs comparatively heavily discounted room rates and receive reservations or attempt to go it alone.  This was an introduction to the tough and generally well-executed business style of the OTAs.  As marketing organizations they realized early on that their livelihood depends on successfully managing two key issues: gaining access to other parties’ assets (rooms inventory) and negotiating advantageous (to the OTAs) contracts with those inventory suppliers.

Hotelier Challenge: Determine the role that the other Internet channel (the online travel agencies) can play in maximizing the property’s performance and manage use of the OTAs to place them in that specific role.

The online travel agencies have demonstrated their business acumen in understanding when during business cycles they have greatest leverage and using those periods to cement advantageous contract terms.  Near-continuous room allocations and guaranteed last room availability are examples of their business focus and negotiating skill.  Particularly interesting is the manner in which the OTA community has reshaped the concept of rate parity to their benefit.

Rate parity was devised by the hotel industry to prevent undercutting of hotel-determined room rates by online travel agencies.  Over time the OTA community redefined parity – and confirmed it in their agreements with hotels – as an assurance that hotels would not undersell OTAs – a quite remarkable re-adaptation of the concept.  The lodging industry convinced itself that it needs to have identical information – the same availability and rates – wherever the prospective guest looked for lodging.  To display different rates from sales channel to sales channel or to not be present and available in some channels when we were in others, we told ourselves, would undermine our credibility with travelers.

Specifically, parity began as an exercise of control by the hotel industry.  However it has evolved into a loss of that control.  Looking more broadly at commerce, are brands undermined by having their products offered at different prices in different outlets?  Is the Coca Cola® brand weakened when a 12-pack of Coke is a different price in Walmart™ than it is in the neighborhood supermarket or at the corner store?  Or is price variety seen by consumers as a function, and a benefit to them of, a vibrant, competitive marketplace?

Hotelier Challenge: Hone your negotiating skills so that we enter discussions with OTA account management staff on an equal skills footing.  Prove wrong the OTA claim that theirs is the most satisfactory travel service shipping experience.  Additionally, reopen the conversation about the wisdom of rate parity.

If the rise in visibility and reservation process influence, as well as the reservation production, of the online travel agencies has been impressive, the speed and breadth of their evolution has been equally so.  Looking back 10 to 12 years, the norm was a merchant model-style arrangement with 15 percent to 25 percent (or more) discounts off of rack rate.  As a fallback when merchant model inventory was depleted, OTAs additionally accessed retail lodging rates.  Succeeding years have seen addition of an array of variations and permutations.  The opaque sales niche, (“Name your own price”™) was defined by Priceline.com™.  Auctions, last minute sites for distressed inventory, private sale sites, niche sites (luxury, adventure and much more) have been most recently joined by flash sales sites and guaranteed refund sites.  By the time this article goes to press, still others may be battling for hotelier’s attention and inventory.

Hotelier Challenge: Monitor the ever-evolving online travel agency community to select the websites that hold the greatest potential to deliver reservations for need periods at acceptable rates.  Implement automated links with those sites in order to maintain their property-related availability, rate and descriptive information.

“Probably Transitory” Channels

That the simple, vague term social media has evolved to include such a wide variety of website types is remarkable.  This evolution has often been a stealth process, with in many cases sites becoming established and influential before we accurately recognized them.  Equally often their evolution has been a study in quick emergence, a race to the peak and then swift, sometimes abrupt decay and disappearance.

As with broad label of online travel agencies, the expansive social media category must be segmented into small divisions before its production potential on behalf of hotel or brand can be assessed.  Five divisions are evident to me.  The first consists of the traveler review sites, exemplified by TripAdvisor.com™.  The next contains the community sites, think Facebook.  Next, locality sites such as FourSquare, Yelp, and CitySearch.  Fourth are the chatter sites like Twitter.  And finally sale sites like Groupon and LivingSocial.

While there is considerable leeway in the category definitions and assignment of sites to each, a clustering process like this eases the option evaluation process.  Using the familiar return on investment evaluation approach (which may in some cases take a defensive form, such as in responding to negative reviews), every opportunity can be assessed in terms of its direct likelihood to generate bookings, to engender a positive perception, or to stimulate complimentary conversation.

The hyperactivity in the social media environment, if not the length of its presence on the travel sales front, suggests two lessons.  Remaining mindful of them is useful when completing a website participation value evaluation.  Those lessons?  The first: size – real or apparent – does not equate to longevity.  High profile sites can be unexpectedly short lived.  These sites can appear huge and their use urgent — for a moment.  Then they can fade as quickly as they blossomed.  Remember MySpace?  The second lesson: that these sites are generally less impactful and less productive than the pundits predict.

The past has taught us to avoid extensive commitment and to remain agile.  It has taught us to participate lightly, to expect and require results, and to promptly discontinue use of those that do not produce.

Hotelier Challenge: Categorize social media website as they emerge.  Differentiate those likely to benefits the hotel from those less likely or unlikely to do so.  Allocate resources to the ones that are impacting you the most (like major review sites) and a select handful of promising new emergents.

Going Mobile – New Access Devices Change the Game

So far this article has focused on the message rather than the medium for that message’s delivery.  Until the arrival and widespread adoption of sophisticated mobile technology, the delivery medium was immaterial.  That has changed.  Also changing must be how we offer information about our lodging and the processes to reserve it.  The popularity of mobile devices and the fact that these devices require a departure from what have become regular and routine ecommerce processes, requires consideration of not simply presentation reformatting but rather of the basic expectations of mobile device users.

Mobile devices have fundamentally changed the world’s attitudes toward of information access and product/service accessibility.  Society’s desire to achieve uninterrupted connectedness – continuous access to people, answers and products/services – has been achieved with remarkable swiftness.  This transition has far reaching implications for the travel industry.

The ubiquity of mobile devices, especially smart phones and tablets has changed how people think about purchasing everything, including travel services.   With a mobile device in hand, products and services are available for consideration and purchase anytime, and at a moment’s notice.

This new degree of accessibility brings with it a price, even a threat, to suppliers.  Quite simply, much of society has moved to the mindset of if it is not accessible and easily obtained, it is not in my universe.  We expect it to be clearly and sufficiently presented and procurable on our device.  If it is not, it’s no longer part of your world.

The need – in fact the imperative – for hotel operators is to ensure that their properties are readily accessible, appropriately portrayed, and conveniently bookable on mobile devices.  These goals are not easily achieved.  As everyone reading this article is well aware, the display capabilities of smart phones are a subset of what is possible on a personal computer or laptop.  The display capabilities of tablet devices are confined as well, although less so.  The result is the need to match that confined display opportunity with reduced, distilled data.  The goal is to say all that needs to be said in fewer, but no less informative and persuasive, words and photos.

Initially the solution to effective lodging presentation was judged to be creation and distribution of downloadable applications or apps.  With the proliferation of apps and the growing awareness of app overload, attention has turned to achieving the needed presentation effectiveness through website optimization.  This process leverages the ability of technology to determine the category of device requesting data to connect that request to the website designated appropriate for that device.  When the query is from a mobile device, that query is routed to a website containing a terser version of the descriptive data and in some cases, a pre-populated reservation path achieved through integration with the user’s guest profile.

The opportunity to effectively offer a property’s lodging to on-the-go travelers is worthwhile and significant in itself.  Addition of the array of social media applications and sites extends and compounds the opportunity.  Location-aware mobile devices enable a new world of proximity marketing – offering incentives and add-ons to those nearby.  Yes, an argument continues about whether a nearby prospective guest should be offered a lower rate as an incentive, or whether rate parity should apply.  Similarly, the debate over the effectiveness of proximity-based promotions continues. Overriding both of these discussions is the still emerging profile of the mobile device user to be a last minute booker bringing worthwhile incremental business.

Hotelier Challenge: Ensure that the individuals or services who maintain the Web presence for your properties have developed mobile-specific versions of your sites.  Verify that the version is being tested and proven suitable for the spectrum of major smartphones and tablets.  Ensure monitoring, reporting evaluation and adoption of worthwhile presentation/participation opportunities.

Electronic distribution has become more important to property success, more diverse in its opportunities, more obtuse in many cases in the value of these opportunities, and more time sensitive in its demands for evaluation, decisions and action.  We are challenged to promptly complete the evaluations, make decisions and take action.  Taking time to categorize the opportunities, define the likelihood of a return on investment, and ensure informative, persuasive presentation of the property – all the while ensuring that same informative, persuasive presentation continues in the legacy sales channels such as the GDS, and in fast-evolving mobile devices, is pivotal to achieving every hotelier’s goal of filling the house.


8 Tough – And Important – Distribution Questions

  1.  Who is doing our day-to-day rate setting for the hotel? Are their actions accurately reflecting senior management’s inventory and rate management intentions?
  2. When was the last time I looked at my hotel on our website? Is the information as solid and appealing as it should and can be?
  3. Is there an attractive, room type specific photo on the site for every one of our room and suite types?
  4. Are the room descriptions on the website inviting?
  5. Are we offering extra revenue generating add-ons in our website booking process? Are we offering early check-in, airport transfers, box breakfasts, box lunches, late check out, etc.?
  6. Are we negotiating directly with OTAs?  If yes, who is doing our negotiating? Are we being tough enough?
  7. Who decides the OTAs and the social media in which the hotel participates? What are the decision criteria?  Do we periodically reevaluate our participation decisions?
  8. Are we responding to every TripAdvisor review?  Who is responding and how quickly?  Are we learning from negative reviews and changing?