PRODUCT TRAVEL INTEGRATION DIRECT CONNECT

 

contract with hotel and static prices, rates, availability

  • ¬†¬†¬†¬†¬†¬†¬†17% of gross revenue of the company 120 miilion; direct connect of company
  • ¬† ¬† ¬† ¬†Technology and Commercial Challenges
  • ¬† ¬† ¬† ¬†Hitlon -> External IT (switch; derbysoft
  • ¬†¬†¬†¬†¬†¬†¬†Small chains usually go to channel managers (siteminder, ratetiger, ezyielder)
  • ¬†¬†¬†¬†¬†¬†¬†Pulling content- we pull from somebody else
  • ¬†¬†¬†¬†¬†¬†¬†Pushing content ‚Äď Push only if there is a change
  • ¬†¬†¬†¬†¬†¬†¬†Derbysoft pulls from product and pushes to¬†extranets)
  • ¬†¬†¬†¬†¬†¬†¬†All margins negotiated at the brand level (rate plan codes that are gouped by room type; 15-20% slapped on as a net rate and then we make a margin increase)
  • ¬†¬†¬†¬†¬†¬†¬†Dis: restrict distribution by hotel
  • ¬†¬†¬†¬†¬†¬†¬†Direct connect no cutoffs and allotment
  • ¬†¬†¬†¬†¬†¬†¬†There is no GPE for diect connect currently

Pros

  • ¬†¬†¬†¬†¬†¬†¬†Auto Res Delivery
  • ¬†¬†¬†¬†¬†¬†¬†Esitly managed by hotel
  • ¬†¬†¬†¬†¬†¬†¬†Incrased brandn exposure
  • ¬†¬†¬†¬†¬†¬†¬†B2c distribution
  • ¬†¬†¬†¬†¬†¬†¬†Short term availability
  • ¬†¬†¬†¬†¬†¬†¬†Increased coverage
  • ¬†¬†¬†¬†¬†¬†¬†Identifies new markets
  • ¬†¬†¬†¬†¬†¬†¬†Provide added inventory
  • ¬†¬†¬†¬†¬†¬†¬†Rate of the day

Cons

  • ¬†¬†¬†¬†¬†¬†¬†Error rates
  • ¬†¬†¬†¬†¬†¬†¬†Relies on Client Technology
  • ¬†¬†¬†¬†¬†¬†¬†Short term (0-90)
  • ¬†¬†¬†¬†¬†¬†¬†Limited Visibility
  • ¬†¬†¬†¬†¬†¬†¬†Eliminates distribution
  • ¬†¬†¬†¬†¬†¬†¬†Unable to market promos
  • ¬† ¬† ¬† ¬†Inconsistent production
  • ¬†¬†¬†¬†¬†¬†¬†Lock of control over Revenue Management
  • ¬†¬†¬†¬†¬†¬†¬†Lack of hotel understanding
  • ¬†¬†¬†¬†¬†¬†¬†Biggest challenge is to standardize all of this with other provider probelsm

Why would a hotel opt out: Maring, bad relationship with SUPPLIER, package rates

Opt in structure is very unfavorable

Figure out why derbysoft is so good at pulling and then pushing to us

Why does product partner with product integration; sometimes they have issues that product managers don’t know how to handle; billing issues or vcc; Hotels don’t know anything about product integration and manages on our side

Opt-n situation lead that you need to send to maria to map and can be connectd to direct connect (Hyatt hotels)

Product managers are expected to manage 200-500 hotels / YEAR

Hilton Palacio ‚Äď Number one booking direct connect; need to identify why these are working

Higher volume on localtgs and direct contract

Number of hotels is stronger on direct connectivity

Objective:

How:

ROI: Desing and print at staples/kinkos; 6-8 pages, and bind it

Hotel printers; acesss from photo library; Nicole to send

Description

Picture

Start Rating

 

Hilton-DC

ACOR-DC

CHOICE-DC

HOBO IS A DC

PRB-Exclusive Deal; No one knows black dots

If increase in star rating, decrease in $

Best Direct Connects are low

  • 65% Cancellation Rate
  • Non-refundable not good
  • 150,000 H (50 Partners, Expedia)
  • Top 10 Destinations are clear
  • Booking bigger

GTA Slide=Good Aesthetic

 

FIT

  1. Travel Australia
  2. Mom Resorts
  3. TripAdvisor
  4. AirBNB
  5. Disney Parks
  6. Delta
  7. Southwestern
  8. Best Western
  9. Cathay PACIFIC

@Krtravelweekly

Static- traditional FIT Contracts

PRB=FIT

Longer Lead Time; Dynamic pricing will loose clients

50% Margin->RD

96/$150 Million

82% Tourico = Static

18% grow up, Dynamically/Direct Connect

Direct Connect: Dynamic 15%, Rate changes, sometimes can’t see because of technology; Hotel doesn’t do well in static distribution

 

DISADVANTAGE OF DIRECT CONNECT

  • Error Ratios
  • Decrease Margin Opportunity
  • Control to Chains
  • Decrease reduces least time connectivity
  • M comes from Channel Managers

 

Mix of Business: Room tells you whom you should book;

  • BLT
  • Eclick
  • LT
  • LMC
  • LMCclub

 

Price Control/Margin Control; control-static pricing; PRBs in back office are yellow

  • Channel Manager is not an XML; Convenience for Hotel
  • DC=Seamless Integration
  • We don‚Äôt
  • Not manual Reservation local TGS Provider

 

IHG has a 7M Marketing plan

Booking.com no has parity; IHG turned off DC

 

  • ¬†¬†¬†¬†¬†¬†¬†You can now look at switches
  • ¬†¬†¬†¬†¬†¬†¬†Higher the transaction size, the more upscale the client is
  • ¬†¬†¬†¬†¬†¬†¬†Lower lead time worse the economy
  • ¬†¬†¬†¬†¬†¬†¬†249 switches work for Tourico

 

Hotel Chains

Wholesalers ‚Äď Clients

Channel Managers/Switches ‚Äď directly connect to PMS; Push distribution channels to hotel partners

Our own api that only support push

DerbySoft can connect to anyone; have all top 10; agoda, gta,  best solution for both sides and the cheapest; suppliers are paying by the booking; china

Hbsi- based on atl; three times more than derbysoft

PI KPI

  1. ¬† Volume ‚Äď GP, Gross
  2. ¬† Booking Failure Ratio (Success Ratio) ‚Äď Ambigous; only monitoring for Web SVC clients/bookings
  3.   How happy are my clients when they get these failures?
  4.   What are the willing to withstand
  5.   Non-Distinct vs. Distinct; we are using distinct and this is the lowest

Booking failure standard is 7-8% ; more sensitive to pull

Push is more real-time updates

Main reason to have direct connect is to cut lead off; static has cut off problems

0-1  booking for today

0.8% booking failure with TGS; our own inventory; we don’t need to cache

Availability and price discrepencis are the problem for connectivity with External providers

Look at abnormal information based on comparison week by week

Hoboo has technical issues and they are selling lots of bookings (Thus more failures)

Check failure ratio; compare last month and last week

Pull- lots of way to cache, transactional (every 24-48 hours you are erasing), predictive; we prefer push

Chain discovery ‚Äď pull by event

Getaroom and Priceline use hot deals

Trigger?

Can you please refresh your hotels for Hoboo, when there is a cache problem; however we expect this to be solved

Force booking-force the system to give another room; rules for how much you want to loose

Our booking failures is better than our competition

TGS-spec.w/hotels

Cities Bridge is buying

Local + Hoboo = DC

Company average for locally connected is 85%

Price Control and margin control. Control is stack pricing. 50% Margin in Research and Development.  Longer lead-time with Dynamic Pricing-loose clients

Transient-leisure demand; the average customer uses a combination of 19 websites and mobile apps during 1 trip

 

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