Briefing: Ctrip and OTAs globally

In January Ctrip invested US$180m in MakeMyTrip Limited, India’s largest online travel company and also entered the UK market by buying a majority stake in Travelfusion, a UK-based meta-search website.

The words OTA and disruption have almost become synonymous in the hospitality industry. Ctrip is a major OTA in China and is now making an impact across the globe. Ctrip’s pricing methods are also relevant to rate parity discussions across the industry.

In these videos experts discuss Ctrip and the OTAs’ disruptive potential across the globe.

Constant deals and consolidation in the OTA market means that the powerful are getting more powerful, and as discussed above rate parity is not yet an issue the industry has put to bed.

Ctrip was launched in 1999. It’s net revenue for 2015 was US$1.7 bn. Accommodation reservation revenues increased 44% year-on-year, reaching US$713 m, and transportation ticketing revenues increased 51% year-on-year, reaching US$688m.

Ctrip’s agreement with MakemyTrip means that it “may beneficially own up to 26.6% of MakeMyTrip’s outstanding shares. Upon completion of the investment, Ctrip will acquire the right to appoint a director to the MakeMyTrip board of directors.”

Ctrip claim that its relationship with Travel fusion will “enhance the efficiency and effectiveness of [Ctrip’s] IT system by leveraging Travelfusion’s advanced technology” as well as “further extending [Ctrip’s] leadership in China’s international travel market”

Last Year Ctrip also acquired a stake costing $400m in eLong, its rival OTA in China.

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Video clips produced by ybc.tv for the Hospitality Channel, including interview from industry conferences such as the IHIF conference as well as specific Hospitality Channel shoots.

Briefing: Smart data adds value

RevPar in the UK hotel industry is growing. According to PWC’s UK hotels forecast 2016, there will be 2.2% growth in ADR in London in 2016, which will help drive a RevPAR increase of 2.3% and take yields to £122.

But hoteliers should not become complacent because of market positivity. Could hotel revenues be increased further with better use of data? Clever businesses are now valuing ‘Smart Data’ – data which is analysed and acted on, over ‘Big Data’, and want any data use to make a difference to the bottom line.

Hospitality experts discuss reacting to data insights:

Good data usage can really help push the revenue of hotels by giving hotels the insight into what’s working, what isn’t, and what they should do to capitalize their assets. Customer data can tell hoteliers how to improve their hotel, and outside data such as weather can tell hotels how to change their prices.

Weather is a particularly rich area of data. According to a report by BSA, “Satellites, weather observatories, radar, and other sensors capture more than 2.25 billion weather data points 15 times per hour — collecting 20 terabytes per day — making more accurate weather predictions around the globe possible.” And this is of course very easily applicable to hotels as weather can be a massive influencer on guest behaviour.

2011 research by Erik Brynjolfsson, Lorin Hitt and Heekyung Kim found that companies that used data to drive decision making saw overall productivity improve by 5-6%

A 2014 survey by Forrester found that companies were analysing only 12% of the data that they already have. There is an unknowable amount of data out there, much of it unstructured and most of it still unused, but this is slowly changing.

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Video clips produced by ybc.tv for the Hospitality Channel, including interview from industry conferences such as the IHIF conference as well as specific Hospitality Channel shoots.

Briefing: How the world is adapting to the sharing economy

Airbnb has met a need on both the consumer and host side of its business model. It is up to date with the latest technology, and has even recently created an app for the Apple Watch. But regulation of this, and similar sharing economy business, has been an ongoing discussion. A trade body for sharing of economy businesses was started in the UK last year, and in January the New South Wales government in Australia, announced plans for a new regulatory framework for businesses like Airbnb.

In these videos an Airbnb executive and three hospitality experts discuss the success and future of Airbnb:

Tourism Accommodation Australia has announced strong support for new regulations to be created in New South Wales. They have emphasised that the, “’Collaborative’ economy must be about ‘contributing’ to the economy.” Airbnb offers 15,000 listings in New South Wales.

In the UK, according to Airbnb, 52,500 hosts shared their homes in the past year. The typical host earned £2,000 by sharing their homes for 46 nights a year.

Last year in the UK a law was passed making it easier for people to share homes. Also in March 2015, the trade body, Sharing Economy UK was launched following the recommendation of the Wosskow 7 Report, a Government-commissioned independent review.  SEUK has a code of conduct that members must sign up to, which according to the website, “was designed to enhance the operation, image and reputation of the sharing economy industry.”

A recent report on the SEUK website highlights statistics that show the growth of the sharing economy in the UK:

  • The number of businesses with no employees has risen by more than 70% since 2000.
  • 3% of the UK workforce is providing a service through a sharing economy platform.
  • A quarter of the UK population has engaged in a sharing economy activity.

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Video clips produced by ybc.tv for the Hospitality Channel, including interview from industry conferences such as the IHIF conference as well as specific Hospitality Channel shoots.

Briefing: Industry unclear on customer acquisition costs

According to Kalibri Labs customer acquisition cost is now upwards of 15%-25% of room revenue.

The shift from direct booking to multi-channel booking means that cost of acquisition has become more of a cloudy issue in hospitality. Businesses must now take into account; fees, commissions, marketing cost, revenue, and effectiveness of each channel.

So which channels overall are more cost effective? Our experts discuss:

The issue of Rate Parity has been contentious between hotels and OTAs. Any difference in the rate offered on each channel certainly affects the overall cost of customer acquisition. Any new channel, be it an OTA, Metasearch site or new entrant that a hotel or alternative accommodation decides to display rooms on, adds new factors and makes cost harder to keep track of. Not forgetting the bookings that still come in through non digital channels.

According to Travel Click, the Average Daily Rate from customer booking directly with a property either in person or over the phone is growing 5.6% in Q1 2016. In Q1, ADR is also growing 4.0% for CRO (phone calls to a brand), 3.3% for OTA, 3% for GDS (in-person travel agents) and 2.3% percent for ‘Brand.com’ (a company’s website).

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Video clips produced by ybc.tv for the Hospitality Channel, including interview from industry conferences such as the IHIF conference as well as specific Hospitality Channel shoots.

Briefing: mobile – the big sell

Mobile technology is expanding at such a rate that it is really any wonder how people keep up with it. iPhone 5GS, Samsung Galaxy S4, Windows 8, Android, and BlackBerry are just a handful of terms that are in our modern-day vernacular without many of us really understanding what it means for us and for business.

Mobile smartphones are the most powerful selling technique which is set to dominate long into the future and we need to be utilising this medium across our business. Whether that’s checking emails, social networks, looking for reviews, playing games, watching films, purchasing hotel rooms and perhaps after all that making a phone call. It should certainly be embraced and our experts this week discuss this with comment from:

  • Cyril Ranque, SVP of Global Market Management for Expedia on the power that these devices bring to the consumer.
  • Douglas Rice, Executive VP & CEO of Hotel Technology Next Generation on expectations being raised with mobile
  • Leo Brand, CEO of Swisscom Hospitality Services on the need for hospitality to up its game
  • Peter O’Connor, Professor & Academic Director of ESSEC Business School on seizing the immense power of mobile in hotels

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Video clips produced by ybc.hpgcms.wpengine.com for the Hospitality Channel, including interviews from industry conferences such as the IHIF conference as well as specific Hospitality Channel shoots.

Briefing: staying connected to your customer

With the explosion of mobile technology across the globe, relationships with customers are no longer one-dimensional. Brands, corporations and businesses need to embrace new media capabilities to stay connected with their ever evolving consumer.

Online commenting, reviewing and criticism is now a 24 hours a day phenomenon, even for the small brands. Understanding the correct tools to use and how to manage this relatively new avenue is integral. Some brands are doing it brilliantly, but are there particular tricks and top tips to learn?

In this briefing we hear from:

  • Ewan Cameron, CEO of Lonrho Hotels on staying connected to his customers
  • Joe Stenson, of Queensway Group on continually processing customer feedback for improved service
  • Peter O’Connor, of the Essec Business School, on which brands are using social media well
  • And James Chappell, Global Marketing Director of Horwath HTL, on the challenges with media immediacy

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Video clips produced by ybc.hpgcms.wpengine.com for the Hospitality Channel, including interviews from industry conferences such as the most recent IHIF conference as well as specific Hospitality Channel shoots.

Briefing: is hospitality harnessing online data?

The explosion of social networks in the past couple of years has opened new opportunities to engage with customers. People are quick to post comments, ask questions and write reviews. This trend is only going to continue.

Organisations cannot remain on top of everything that is going on, but they certainly need to be aware of what is being said. With numerous ‘listening’ tools in the market there is a need to be intelligent with online commenting as a business as well as getting a feel of what the market is saying about you.

But is hospitality doing enough in the digital world? This question is answered in this week’s briefing, including comment from:

  • Sean Worker, CEO of BridgeStreet on whether the industry is using the data intelligently.
  • Andrew Sangster, Editor of Hotel Analyst on applying the data to the consumer.
  • John Brennan, CEO of Jurys Inn Hotels on using data to target his customers.
  • And Peter O’Connor of the Essec Business School on the industry uptake of the new social technologies.
 


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Video clips produced by ybc.hpgcms.wpengine.com for the Hospitality Channel, including interviews from industry conferences such as the most recent IHIF conference as well as specific Hospitality Channel shoots.

Briefing: building customer loyalty in the digital world

The new digital world allows all brands and individuals to communicate with each other with the click of a few buttons. But is the hospitality sector fully utilising all the tools available?

Mobile technologies now allow General Managers and other executives to understand exactly what is going on in real-time. This has never been achievable before, and it will only improve over time.

By being clever with contemporary technologies, brands can build advocacy and loyalty in a very personalised and specific way. Building this loyalty and the techniques of doing so are discussed in this week’s briefing.

Including comment from:

  • Sean Worker, CEO of Bridgestreet on understanding his customer needs 24/7.
  • Andrew Sangster, of the Hotel Analyst, on building a picture of consumers in real-time.
  • Robert Shepherd, SVP of Development and Design for IHG Europe, on what techniques IHG are implementing to build brand advocacy.
  • And Peter O’Connor, of the Essec Business School, on tactics for achieving loyalty with online consumers.

If you’ve been sent to this page but you’re not yet on the circulation list to receive these regular briefings and you would like to sign up, you can do so here. It’s free.

Video clips produced by ybc.hpgcms.wpengine.com for the Hospitality Channel, including interviews from industry conferences such as the most recent IHIF conference as well as specific Hospitality Channel shoots.

Briefing: using data intelligently

The proliferation of data has never been so prevalent. Information is being created like never before. Customer interaction in hospitality through technology and software has been used for some time. As these systems become more sophisticated, companies can in turn be much more targeted and personalised in the way they interact with their customers.

The problem in all industries isn’t so much getting the data, it is understanding the data and what it means for future decision-making. Experts believe that 80% of the data that is needed in contemporary decision-making now sits outside your business.

This week we hear from technologists, hoteliers and analysts on their perception of how this is impacting every business, including:

  • Simon Vincent, of Hilton Worldwide on his company using the data of a 30million strong loyal database of customers
  • Sean Worker, of BridgeStreet on the balance needed between technology and real experience.
  • Andrew Sangster, of Hotel Analyst on the lack of analysis the hospitality industry is doing on the vast data they create.
  • And Peter O’Connor, of the Essec Business School on how hospitality can be utlising the data more effectively.
 


If you’ve been sent to this page but you’re not yet on the circulation list to receive these regular briefings and you would like to sign up, you can do so here. It’s free.

Video clips produced by yBC.tv for the Hospitality Channel, including interviews from industry conferences such as the most recent IHIF conference as well as specific Hospitality Channel shoots.

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