March 25, 2021 • 32 mins
Welcome back to the Unconstrained Conversations podcast! On this very special episode the tables are turned and the interviewer, IDeaS’ chief evangelist Klaus Kohlmayr, becomes the interviewee. Ulrich Pillau, CEO & co-founder of Apaleo interviews Klaus on The Pulse by Apaleo: The Voice Of Hospitality Tech Leaders Podcast. We are sharing their insight-packed discussion with you here. Topics addressed include:
- The future of revenue management coming out of the pandemic
- The value of revenue management during periods of low demand and how having the right price is now more important than ever
- How IDeaS was able to recalibrate its revenue management systems to respond to the unprecedented, rapidly changing demand in 2020
- IDeaS’ product updates to accommodate the future of revenue management
- How hospitality companies are using the crisis as an opportunity
- Now is the right time to re-evaluate your business and operations to ensure recovery readiness
Please subscribe to our podcast on your favorite podcast network and share with colleagues in the travel and hospitality space who may find this episode useful.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
SPEAKER_00 (00:06):
Hi everyone, welcome back to another really
unconstrained episode of ourpodcast.
A couple weeks ago, Apaleo, aproperty management system
startup, invited me to their newpodcast.
Uli Pelau, co-founder of Apaleo,and I talked about the evolving
technology needs of thehospitality industry, the
convergence of data, andaccelerating innovation in times
(00:28):
of crisis.
I do hope you enjoyed this very,very interactive conversation,
and we'll be back with a newguest next week.
Thank you.
SPEAKER_02 (00:40):
Welcome back to the Pulse by Apaleo, the voice of
hospitality tech leaders, thepodcast all about sharing
insight and knowledge fromthought leaders within the
hospitality and tech community.
I'm your host Alicia, and todaywe're chatting with Apaleo
founder and CEO Uli Pillao andIdeas Chief Evangelist and Head
of Strategy, Klaus Kobe.
(01:00):
In this episode, Klaus and Ulitalk about the future of revenue
management.
You will gain insight into whybig brands have used this past
year to replace their datedrevenue management systems with
the next generation and newtools.
You will also learn why Ideas isfocusing on smaller hospitality
owners who can only afford tospend 10-15 minutes a day on
revenue management bysimplifying tools, creating
(01:23):
seamless integrations andconnections, and scale up on an
adaptation to revenuemanagement.
Stay tuned until the end to seehow Ideas and Apileo are going
alongside of each other down thesame path.
What path is that exactly?
You'll want to find out.
Alright, so before we getstarted talking about the
(01:46):
exciting topic of future ofrevenue management, I just have
to ask Klaus, as a nativeAustrian, how did you end up in
my hometown of Minneapolis,Minnesota, of all places?
SPEAKER_00 (01:57):
Yeah, what a coincidence, right?
That uh you're in Munich and uhfrom Minnesota, and I'm from
near Munich, not in Munich, nearMunich, and um I'm ending up in
Minnesota.
Um it's been a long journey.
I uh finished hotel school inAustria uh when I was uh 20, and
then um I worked with variouscompanies that kept moving me
(02:17):
around the world, um includingum IHG, where I uh worked for 12
years in uh uh started in Viennawith them and then uh moved to
uh New York and Paris and Londonand Singapore.
And then when I was in Singaporeand I became more and more
involved in revenue managementand pricing, I um joined Ideas,
opened up their Singaporeoffice, and started building
(02:40):
their consulting arm or theservices arm.
And then after a few years,Ideas asked me to um move to
their head office in uhbeautiful Minnesota, which where
I've been uh since 2010.
So that's how I ended up inMinnesota.
SPEAKER_02 (02:53):
So you got there about the time that I left.
SPEAKER_00 (02:55):
That's right.
Yeah, 2010.
And I'm I'm actually enjoyingit.
SPEAKER_02 (02:58):
So glad to hear.
Um, so to get to a very funtopic uh with Uli and myself
now, what are your thoughtsgoing forward as we are
hopefully going to be gettingout of this COVID pandemic
globally soon?
What is the future of revenuemanagement looking like?
SPEAKER_00 (03:16):
Um I believe uh it's been extremely hard for everyone
in the industry, first of all.
Um I know a lot of my friendsand colleagues um are looking
for a job or out of um out of ajob at the moment.
Um so it's uh it's been adevastating year for many, many
people around the world.
Um uh but we do see some greenshoots coming up in you know,
(03:38):
starting in Asia, New Zealand,Australia, and and I believe
over the next six months we'llsee more and more of a rebound
announcing itself.
Not a full rebound, but a fulluh rebound announcing itself.
There have been a lot ofquestions in 2020 about the
value of revenue management ifthere is no revenue to manage,
and and I always say I wouldhave agreed maybe seven, eight,
(03:59):
nine years ago, um, withtraditional revenue management
approaches that really looked atum the peak periods and
compression days of high demand,managing inventory and managing
opening and closing rates.
But the the approach to revenuemanagement has really changed
now.
It's really more about pricingand it's more about inventory
(04:20):
management.
And if you look at the rightprice is still relevant, I would
argue it's even more relevant ifyou're at 20 or 30 percent than
if you're at 90 or 80%, becauseright now hotels need every
single euro or pound or dollarthat they can get in order to
pay their lenders at the end ofthe month, make payroll, keep
(04:43):
their people employed, um, andjust get through this crisis,
get through the next six toeight months.
So I would think revenuemanagement, because it has moved
on from where it used to be, isum as important and as critical
as it has always been.
And there's a couple factors, ifI if I could just expand.
Um, one is that we have seenthat people at the hotel and at
(05:04):
the corporate office need umaccurate and trustworthy data.
And the revenue managementsystem, together with the
property management system, isusually the system that has the
most accurate description ofdata.
It's the closest to the sort oftruth that you can get.
You need to be able to forecastnot just for revenue management
purposes, but also for laborlabor planning and resource
(05:26):
planning uh focus uh purposes,and you need to automate the
distribution of your pricingdecisions and your rates through
as many channels as you can, andyou need to do that, especially
now with the least amount ofpeople and the least amount of
manual interaction possible.
So, because of these threefactors all coming together,
they remain critical, andrevenue management therefore
still remains very critical.
SPEAKER_01 (05:47):
Klaus, before we go more into where is the future of
revenue management and theaccommodation industry,
actually, because obviouslythat's very tied together from
our perspective, can you explainus a little bit how you manage
the last year?
Because essentially, when I lookat those systems that are there,
um they are obviously builtaround certain models.
(06:08):
And the models in 2020, Isuppose, were totally different
from than any year before thatum uh that that crisis here.
So, how are you able tocalibrate the systems and
respond to the changing demandand ups and downs and
everything?
Because I think that's a veryinteresting question for the
(06:28):
people that are listening.
SPEAKER_00 (06:29):
Yeah, absolutely.
And Ula, you and I we've been onmany stages and we've discussed
many times the value of man andmachine or man versus machine.
I think this was that the last12 months have really proven
that it is a man and machinescenario, not a man versus
machine scenario.
So that the first thing that wehad to do was make sure back in
(06:50):
uh March-April, we made surethat our hotels that are working
with us around the world areproperly equipped to deal with
the high level of uncertainty.
So we uh spent the first fewweeks, I would say six to eight
weeks, to making sure that thehotels, when they're closing, uh
obviously proper the systemknows that hotels are closing.
(07:13):
The system understands thatdemand periods have changed and
demand patterns have changed,and we had to do that manually.
There was just no other way todo that.
We had to tell the system thatwhat is happening right now is
not a normal situation.
Um, and we went in and made somesignificant changes to our
algorithms to put more weight onthe most recent past than the 12
(07:36):
or 13 or 18 months past.
Um we do incorporate a lot offuture demand uh uh signals into
in our system.
We work with uh companies likeTravel Click for the demand 360.
We incorporate some SDR data forinformation purposes.
So we look at forward-lookingsignals that help the system
understand what's going on, andobviously that's been very, very
(07:58):
critical.
Um, but first we had to teachthe system that what's happening
is out of the ordinary.
We told the hotels to setspecial event periods or make
sure that the flag in thesystem, the period that they're
that they're in, that that thesystem understands that it's not
something that is going tohappen again.
And then when demand came backin the summer, we had to tell
the system that now demandstarts coming back.
(08:21):
Um, tune up the sensitivitiesand tune up the decisions.
And now, as we're going throughthe third or or second or third
lockdown periods, we're we'regoing back again and telling the
system that there is anotherlockdown.
So we're kind of applyinglearnings from March into the
current lockdown scenarios.
Um so we kind of know now how tohandle that.
And as soon as we see demandcoming back, we will tell we'll
(08:42):
go back in and tell the systemthat what what is uh what the
system is seeing now will be thethe normal trends going forward.
So we're constantly working withour 14,000 hotels and making
micro adjustments to thealgorithms.
SPEAKER_01 (08:56):
Understand.
Very interesting.
And I mean, one thing we we sawin our user base was that
essentially a lot of hotels andgroups were closed, obviously,
during that period over here inEurope.
But we um in fact had a numberof clients that were pretty
successful even during thecrisis, either during a certain
period, let's say summer of lastyear, summer season of last
(09:17):
year, or throughout the wholeperiod and keep kept the hotels
open.
Do you have an estimation?
Well, I mean, your client baseis obviously huge worldwide.
You have a million hotel roomsor so with ideas.
I and was my last information,maybe it's grown since.
But do you have any informationhow many of your properties um
kept uh were kept open and whichwere the good ones uh among all
(09:42):
of these crisis hotels lastyear?
SPEAKER_00 (09:44):
Um yeah, if I remember it right, I think at
the peak of the lockdown inApril, June, I think 70% of the
hotels that we work with.
So we currently have 14,000hotels that we support.
Um 70% of them were closed.
Um we're now back to I think 90%or 80% of the hotels back open.
Um obviously in the UK it'sstill very difficult.
(10:04):
In parts of Europe, it's stillvery Europe is still very
difficult.
The US has always kept theirhotels open most of the time.
Um China obviously veryaggressive in February, but
since then have re haverebounded with most of the
hotels looking at about 60%occupancy.
Um in we have about 400 hotelsin China that we support.
So it's been it's been kind of abig drop in April, May, 70, 70%
(10:29):
of the hotels closed, and thenuh since then a nice rebound.
SPEAKER_01 (10:33):
And and when you look at kind of the system side,
um I must admit from ourperspective, we have learned a
lot of things.
Actually, what was fascinatingfor us to watch that uh was that
last year we had a number ofrecord months in a row.
Um because we are able to doimplementations onboarding in a
certain way.
It's it's very lean, it's veryfast.
(10:56):
What are your learnings fromfrom last year?
I mean, when you when you sayyou want to position revenue
management now for the futurefor the accommodation industry,
what things are you changingwithin the system and also
within the procedures you'reusing to onboard clients?
Have there been any adaptationsor main changes from that
(11:16):
perspective?
SPEAKER_00 (11:17):
Yeah, the first thing that we did in we worked
with all of our clients to helpthem through this very difficult
time with relief efforts, right?
So we we extended uh credits, webecame more flexible in our
payment terms and invoicing, andwe really worked very closely
with all of our clients, whichwas very highly appreciated, uh,
to make sure that we understandthe financial situation that
(11:38):
they're in, right?
So that was the first part.
Now what we're seeing isactually through through the
second part of 2020, there's twobig trends that we're seeing.
Uh, one, uh, a couple of the bigbrands have decided to take this
opportunity to uh replace theirrevenue management technology
with the latest um you know nextgeneration technology.
(11:59):
And uh we were fortunate enoughthat um you know we had we have
continued to innovate andcontinue to build um new tools
and new platforms and and newrevenue management technology um
that uh that that they wereinterested in or that they uh
they were able to adopt.
Um so um there is a big amountof investments going into
(12:20):
upgrading revenue management uhsystems right now.
Um on the other hand, we're alsoseeing uh a strong interest in
tools beyond revenue management.
We launched a uh operationalforecasting tool at ITB last
year, which probably nobodyremembers anymore.
But uh it's called it's calledexactly it's called Ref Plan,
(12:41):
and with Ref Plan, hotels canforecast their overall revenues,
their total revenues, uhincluding F and B meetings, and
they can also use that to planfor their entire operation.
Um so we have a Ref plan inplace, I think at uh over five,
six hundred hotels right now.
Very, very strong feedback.
Some hotel companies have toldus they wouldn't be, wouldn't
have been able to go through thebudgeting uh process this year
(13:03):
without a tool like that.
Um so we were very fortunate init to be in a situation where we
had something ready that helpspeople not just with revenue
management, but also withoperational problems,
operational forecasting,understanding total revenue.
SPEAKER_01 (13:17):
Okay.
Ideas has been around for manyyears, obviously, very
successfully.
SPEAKER_00 (13:21):
30 years.
SPEAKER_01 (13:22):
30 years, yeah, crazy.
I've spent more than 10 years ofmy life with the life with the
company.
SPEAKER_00 (13:28):
That's why you lost all your hair, Uli.
That's what it is.
SPEAKER_01 (13:30):
Yeah, exactly.
That was the hard time at Ideas.
You are having the fun timesright there.
So going backwards, I mean, yoursystem is obviously a very um
solid one.
It has good history.
Um, you know what you're doingboth with the system as well
with the procedures.
(13:51):
Um today I've met a lot ofhoteliers and hotel uh hotel
groups that say we want to gorather with lean revenue
management than in the past.
So some of them, obviously, thegroups might stick to the bigger
systems, but there are others aswell that say um isn't isn't
there anything kind of easier,faster, quicker to implement and
to use?
(14:12):
Now I'm aware of obviously theideas pricing system um rather
than the full system.
Are there any other efforts tomaybe look at developing new
systems from your perspective?
Or are you at this momentenhancing what you currently
have?
SPEAKER_00 (14:27):
Um both, Uli.
And and um I think I think thereality is that um revenue
management, as I call it, getsmore and more democratized,
right?
In the beginning, when when whenyou were with Ideas, a very
small number of hotels couldafford a revenue management
system.
I remember when I uh uh receivedIdeas in 1998, uh it was a
(14:49):
six-figure price tag, right?
And a big box and lots of floppydisks that we had to uh you know
put into the system to load itall up and get it started.
Um, for the people that rememberfloppy disks.
And it's true that um our pathis uh democratizing revenue
management so as many people canuse revenue management tools as
possible.
(15:09):
And with that comes asimplification of revenue
management systems.
We need to be able to putrevenue management systems in
the palm of people's hands ontheir phones.
We realize that people can't,you know, they don't want to sit
hours and hours in front of adesktop computer anymore.
They want to get pricingdecisions very quickly.
Maybe they can only spend 10-15minutes a day on revenue
(15:30):
management and pricing areas ifyou're an owner-operator or a
general manager of a smallerhotel.
So our path is towardssimplifying revenue management,
making the tools easier, makingthe integrations and connections
seamless, as you know, Oli,you've been on this path as
well.
And uh just in general, scale upthe uh the adoption of revenue
(15:52):
management tools significantly.
And and I can't go into thedetails today, but you'll see a
significant increase of thenumber of our hotels that we're
supporting over the next um 18months.
Um and that is one of the that'sthat is one of the outcomes of
the effort in innovation, uhbuilding new tools, building
(16:12):
simpler tools that we have gonethrough over the last couple of
years.
So if you if you look closely atour website, website, you will
see the number very, veryquickly increasing from 14,000
to way beyond that.
SPEAKER_01 (16:24):
Great.
And um actually you mentionedsomething which is very
interesting and uh which has todo with integrations.
I mean, I remember doinginterfaces for you was always a
kind of struggle, not because ofyour technology, but obviously
you need a lot of data.
So you want a lot of data fromthe PMS, but also from other
sources in order to come up withthe best possible forecasts.
(16:47):
But you also want them todistribute the decisions and
pricing to different systems,not only to the PMS.
And in the past, that has alwaysbeen a pretty long procedure
because the PMSs are sodifferent, the distribution
systems are so different, it'shard to get the right data from
them, it's hard to distributethe right decisions again.
So I believe you've been doing alot of work on your side on how
(17:10):
to integrate to differentsystems.
SPEAKER_00 (17:12):
Um absolutely.
And part of that is thanks tocompanies like yours, only
right.
Um, apaleo and others have shownthe way that um integrations
don't have to be complicated.
They can be a plug-and-play orcan be done overnight or within
a couple hours, like like Apaleodoes.
Um and we're on that same path.
(17:33):
You know, we do want to makeintegrations easier.
We feel you know, they shouldn'tbe uh breaking the bank for
hotel companies.
They shouldn't take six monthsor nine months or two years to
accomplish.
And we've always struggled withthat.
As we connect to more and morehotels, we we have to connect to
smaller and smaller propertymanagement systems and smaller
(17:56):
and less sophisticated tools,and that makes integrations um
uh pretty hard.
Some of our integration worktakes years to accomplish.
Um, and that's not the future,right?
You've talked about APIs andyou've talked about modern ways
to connect with each other'ssystems, and we firmly believe
we should be all part of oneecosystem that we can easily
(18:17):
integrate and connect andexchange data with.
And that we're on the same path.
We're working on APIs, we'reworking on uh different ways of
creating uh connections andinterfaces.
So I think it'll for theindustry it'll be much easier in
the future to just plugdifferent systems in whenever
the need arises.
SPEAKER_01 (18:35):
Cool.
And and uh when we talk aboutthe future of the industry, um,
I mean, we we have been speakingwith a lot of hotel groups,
hotels, owners, operators,investors over here in different
parts of the world to figure outwhere all of this is going.
Um and and I think there you seea lot of traditional hotel
groups that are there and don'treally know how to react to the
(18:58):
crisis.
They are there and say,hopefully it will kind of come
up again, demand will be thereagain, it will return to what it
was before.
However, we also see quite someplayers that are using that
opportunity actually to come upwith totally new concepts, with
hybrid businesses, um, mixedbusinesses.
There are a lot of new ideaswhich actually people are
(19:21):
putting into place in theaccommodation industry right
now.
And I mean, Oyo and Airbnb havebeen there for a while, but I
see lots of players coming up indifferent European countries.
What is your general um feelingwhere the industry is going?
I mean, will it be again thesame type of hotel we have seen
(19:41):
for the past 30, 50, whateveryears?
Or do you think there will be aradical change to the industry
in many ways?
SPEAKER_00 (19:49):
Um I think it's a really, really exciting time
because um I don't think I'veever seen the amount of
entrepreneurism and uh startupmentality and innovation and
creativity in the accommodationspace ever.
And and a lot of people arecoming up, as you said, with
very, very creative ideas.
(20:10):
And I think if our core doesn'tbuy all of them up and integrate
them into their own uhinfrastructure, um it's very
exciting that to see that uh wewill we we we are expanding what
it means to stay in to staysomewhere else, right?
Away from home.
Um I'm excited by you know thealternative accommodation space.
(20:31):
I'm excited about the mixed use,kind of where you have flexible
rooms, where you have likeCitizen M, the lot of a lot of
social spaces and meeting spacesthat you can interact with,
right?
That the work from home, Ithink, is going to stay in
certain areas of um of the worldand for certain industries.
So I'm very, very excited aboutthe change in accommodation.
(20:53):
And if we look at the forecastnow that Airbnb is uh is a
public company, right?
It's easier to get data fromthem.
Uh they're but they'repredicting a 30% uh I think
revenue increase next year,which is probably the only
accommodation provider in theworld that is really bullish on
actually 2021, right?
So it's uh uh it's very excitingto see how the the space is
(21:14):
evolving.
Um and I think it's great forthe industry.
It all keeps us uh keeps usengaged and keeps us um uh on
track.
What's interesting to see isthat some of these startups
there that started out in thealternative accommodation space
are now starting to buybuildings and converting them to
hotels, right?
So it's uh some of thesecompanies have started on one
side and moving to the otherside.
(21:36):
Hotels are moving from the hotelside to the alternative
accommodation side.
It's it's all becoming more andmore mixed, and it's all
becoming just about providing acustomer the right accommodation
for their purpose or for theneed that they have at the
moment, right?
SPEAKER_01 (21:50):
Yeah, and actually, I'm I just can confirm that from
our perspective on a smallerscale.
I mean, we see quite somebusinesses over here which are
using that crisis actually as anopportunity.
I mean, uh, talking about someof our own clients like
Limehome, Cozy Hospitality,Stary, and so on, those are new
(22:10):
companies that actually duringthe crisis received quite some
big um investment from partiesthat say this is actually a
concept that can survive at anytime.
Um, and and some of them havebeen running occupancy
throughout the year of 60, 70percent, even though most of the
other hotels were closed.
(22:31):
So we we think that's a bigopportunity as well and and and
should be used in in many waysby those people.
And we see more and more comingup.
Actually, what's interesting aswell, it's it's in many cases,
it's not hoteliers doing it.
It's not the kind of traditionalhoteliers, operators, owners,
but it's people coming fromoutside the industry that say,
(22:52):
you know, it's it has been runin the same way for the past 50
years, there must be a betterway to do accommodation business
today.
And some of them are reallysuccessful, also using, I would
say, more hybrid technology thanin the past.
Because if you really thinkabout the changing demand for
those properties, um doing thiswith legacy system, let it be
(23:14):
revenue management or propertymanagement or whatever system,
is extremely hard because justchanging the configuration or
onboard a different uh hoteltype, uh, it takes them months
and months.
So we believe in this um tohappen much faster and the
onboarding and everything whichhas to do with it as well.
I agree.
(23:35):
And now one important piece isobviously um when it comes to
revenue management, there is alot of training and education
involved.
Um, have you been moving a lotof um that online or have you
been doing it before, or what isyour kind of perspective on how
to educate and train users andeven non-users of revenue
(23:56):
management?
SPEAKER_00 (23:57):
No, I you know, I always like to think about uh uh
when when a hotel or or anyaccommodation provider um gets
our system, they're not justbuying a tool or a system,
they're also uh joining thecommunity, right?
So they're joining right now acommunity of 14,000 users that
are also using the same toolsand probably similar processes.
(24:18):
Um the first thing, uh actually,one of the first things we did
obviously last March and Aprilwas move all of our training
virtual because we just didn'thave an opportunity to go to the
hotels anymore since they wereclosed.
Um we've always tried that inthe past, but what we found is
the industry always has apreference for face-to-face
(24:39):
training.
So our approach is we we givethe hotels what they like most
and what is most effective tothem.
So obviously during thelockdowns, we had to move
everything to a virtualenvironment and we're able to
train and get our hotels up andrunning completely virtual with
no problem.
We have seen over the last fewmonths as hotels reopen and
(25:01):
wherever it's safe in Australia,New Zealand, in Asia Pacific,
hotels are asking for us to comeback on site and train the staff
face to face, and we havetrainers around the world who
can do that as long as it's safeand it confirms with the
government regulations.
Um, so we're kind of in a hybridenvironment.
We have all the tools and thetechnology and the learning
(25:23):
platforms to engage peopleremotely.
We have a team of clientrelationship managers who speaks
to most of our hotels on everysingle month, um, like as a
buddy or mentor, and engageswith them.
But we can also do thatface-to-face if people want us
to come on site.
So we're we're our one word, Iguess, is we're flexible and
we're we're open to do whateveris works best for the hotel.
SPEAKER_01 (25:46):
Understand.
Now, when I we you mentioned acore before, and um in fact
you're right, they have beenbuying and are buying a lot of
different businesses, and theyare actually also converting
their own hotel group with newproducts or to different
products.
So the CEO announced a lot ofchanges to the account in
(26:08):
general.
Um one personal question.
I mean, I always like, forexample, the 25-hour suit
product.
I think it's a great hotelproduct, they have very nice
hotels, and obviously our coreare now taking control.
If you would go around the worldpersonally and say outside those
big groups, are there threeclients where you would say this
(26:30):
is really a hotel accommodationproduct which really impressed
you, both from a hotelperspective, but also from an
operating perspective.
So making money out of hotels orincreasing the value for the
owners?
Um, anybody that that strikesyou there?
SPEAKER_00 (26:46):
Um I'll have to think about it a bit.
You know, I I um um I'mindependent of client or not
client, right?
So I think what Accor is doingis really great.
They're really a lifestyle brandrather than a hotel brand.
Um the mama shelters, the25-hour hotels, SBE in the US,
right?
They have been incorporatingsome of these more uh
(27:07):
lifestyle-focused brands intotheir brands, which makes the
company a different company.
I think it's great, and I thinkit's a sign of how a hotel
company needs to pivot and needsto evolve with the evolving
consumer demand.
Um, I agree, you know, 25 hotel,25 Hour Hotel is a great, is a
fantastic company.
(27:28):
It would be one of the companiesand one of the hotel hotel
groups that I would look to as aas a good example.
Um, in Asia Pacific, you haveComo hotels, which is similar,
right?
Boutique high lifestyle hotels,uh, which is great.
There's a company in the US,it's called Under Canvas, which
are luxury tents and clamping.
(27:48):
I've used them a few times, andthat's just a great experience
when you're out in desertsomewhere and you're you're
you're in a luxury tent.
Um not cheap, it's still two orthree hundred dollars a night,
but um you get the wholeexperience of sleeping under the
stars in a nice environment.
Um Citizen M always comes up,right?
I everyone talks about them.
(28:09):
I just love their company andwhat they do, and and uh the
leadership team is alwayspushing the boundaries, as we've
seen over the last few uh monthsas well, with the launch of
subscription services for bothindividual and corporate
travelers.
So I think that would be on anon-traditional hotel world,
that would be my topics.
SPEAKER_01 (28:27):
Yeah, makes a lot of sense.
I mean, I see some some newplayers here.
Um what we see happening, whichis a trend really, is that those
hotel accounts that are poppingup now, a lot of them are
tech-driven hotels.
So they look at um operating thehotels in a different way than
in the past, much more efficientthrough automation and
(28:48):
technology behind.
We see where that that trendwill go.
Obviously, there is still afive-star segment like the
Mandarin Orientals of that worldthat will operate on a high
service level with staff, butactually everybody else could
really use technology toautomate much more and work much
more efficiently than in thepast.
SPEAKER_02 (29:08):
So, gentlemen, we are coming to the end of our
conversation.
And Klaus, I just want to askyou, in your perspective, are
there any critical items whichyou believe really need to be
discussed and brought to theforefront to really help prepare
the accommodation industry forthe future?
SPEAKER_00 (29:25):
No, I I think everyone right now in the
industry needs to have a hardlook and evaluate and rate
themselves how ready they arefor the rebound.
Right?
It's unquestionable there'sgoing to be a recovery and that
there's going to be a rebound.
Uh, it's not an if, it's when.
It's just the question is whenit's going to happen.
(29:46):
Some some will see it, some arealready seeing it in parts of
the world.
I guess the most of the Westernworld will start seeing it in
June, July with the summermonths, and then getting into uh
September, October.
Um, so now is the time toprepare.
Yourself now is the time to lookat your technology stack.
You know, do you have the righttechnology in place that will
(30:06):
make it easier for you toconnect other systems and other
technologies?
Do you have the rightinfrastructure in place and the
right structure?
Right after this call, I'm goingon a I'm getting on a call with
a CEO of a company in Europethat has some questions about
centralizing their revenuemanagement and automating their
revenue management approach.
(30:28):
So is your current structure thebest structure you can have for
the future?
Do you have the right ways toget access to clean data and
accurate data that you cantrust?
And then are you able to runyour operations and run your
revenue management and run yourmarketing and sales as efficient
as possible?
You need to spend the next sixmonths to get ready for the
(30:51):
rebound when it happens.
This is the ideal time.
Obviously, funding is always auh is always a question, but
this is the ideal time toprepare yourself.
SPEAKER_02 (30:58):
Absolutely.
So, what's on your agenda forthis year?
SPEAKER_00 (31:02):
Um, you know, I was just telling Uli that I would
love to go over to Europe and goget some skiing under under my
legs, I guess.
Um, but I'm not sure if that'sgonna happen.
So um I think my my my numberone priority would be to um be
able to go over to Europe andsee my family.
I still have uh parents andbrother and sister in Austria,
(31:22):
and I haven't seen them in ayear.
So that would be the first thingI would do when travel is safe
again.
So um at the moment uh I'mstaying safe here in
Minneapolis, but as soon asborders are becoming a little
bit ordered, the situationbecomes a little bit more um
forecastable, I would say, oruncertain or certain.
Uh I would you find me on theplane over to Europe.
SPEAKER_01 (31:43):
And hopefully then you'll see some old friends here
in Munich as well.
SPEAKER_00 (31:46):
Of course, Uli, of course.
I'll work out of your office.
How about that?
That's right, thank you.
SPEAKER_02 (31:55):
Thank you so much, Klaus, for joining Uli and
myself today.
It was a pleasure getting tospeak with you, and hopefully
we'll be able to see you soonover here in Munich.
SPEAKER_00 (32:04):
That would be great.
I'm looking forward to it.
Thank you very much forlistening, and I hope you found
this episode valuable for yourown business circumstances.
Check out the show notes, linkto the episode.
Help more people in the industryfind this podcast by sharing and
rating.
And don't forget to subscribe tothe series wherever you listen
to it.
Hi everyone, welcome back to another really
unconstrained episode of ourpodcast.
A couple weeks ago, Apaleo, aproperty management system
startup, invited me to their newpodcast.
Uli Pelau, co-founder of Apaleo,and I talked about the evolving
technology needs of thehospitality industry, the
convergence of data, andaccelerating innovation in times
(00:28):
of crisis.
I do hope you enjoyed this very,very interactive conversation,
and we'll be back with a newguest next week.
Thank you.
SPEAKER_02 (00:40):
Welcome back to the Pulse by Apaleo, the voice of
hospitality tech leaders, thepodcast all about sharing
insight and knowledge fromthought leaders within the
hospitality and tech community.
I'm your host Alicia, and todaywe're chatting with Apaleo
founder and CEO Uli Pillao andIdeas Chief Evangelist and Head
of Strategy, Klaus Kobe.
(01:00):
In this episode, Klaus and Ulitalk about the future of revenue
management.
You will gain insight into whybig brands have used this past
year to replace their datedrevenue management systems with
the next generation and newtools.
You will also learn why Ideas isfocusing on smaller hospitality
owners who can only afford tospend 10-15 minutes a day on
revenue management bysimplifying tools, creating
(01:23):
seamless integrations andconnections, and scale up on an
adaptation to revenuemanagement.
Stay tuned until the end to seehow Ideas and Apileo are going
alongside of each other down thesame path.
What path is that exactly?
You'll want to find out.
Alright, so before we getstarted talking about the
(01:46):
exciting topic of future ofrevenue management, I just have
to ask Klaus, as a nativeAustrian, how did you end up in
my hometown of Minneapolis,Minnesota, of all places?
SPEAKER_00 (01:57):
Yeah, what a coincidence, right?
That uh you're in Munich and uhfrom Minnesota, and I'm from
near Munich, not in Munich, nearMunich, and um I'm ending up in
Minnesota.
Um it's been a long journey.
I uh finished hotel school inAustria uh when I was uh 20, and
then um I worked with variouscompanies that kept moving me
(02:17):
around the world, um includingum IHG, where I uh worked for 12
years in uh uh started in Viennawith them and then uh moved to
uh New York and Paris and Londonand Singapore.
And then when I was in Singaporeand I became more and more
involved in revenue managementand pricing, I um joined Ideas,
opened up their Singaporeoffice, and started building
(02:40):
their consulting arm or theservices arm.
And then after a few years,Ideas asked me to um move to
their head office in uhbeautiful Minnesota, which where
I've been uh since 2010.
So that's how I ended up inMinnesota.
SPEAKER_02 (02:53):
So you got there about the time that I left.
SPEAKER_00 (02:55):
That's right.
Yeah, 2010.
And I'm I'm actually enjoyingit.
SPEAKER_02 (02:58):
So glad to hear.
Um, so to get to a very funtopic uh with Uli and myself
now, what are your thoughtsgoing forward as we are
hopefully going to be gettingout of this COVID pandemic
globally soon?
What is the future of revenuemanagement looking like?
SPEAKER_00 (03:16):
Um I believe uh it's been extremely hard for everyone
in the industry, first of all.
Um I know a lot of my friendsand colleagues um are looking
for a job or out of um out of ajob at the moment.
Um so it's uh it's been adevastating year for many, many
people around the world.
Um uh but we do see some greenshoots coming up in you know,
(03:38):
starting in Asia, New Zealand,Australia, and and I believe
over the next six months we'llsee more and more of a rebound
announcing itself.
Not a full rebound, but a fulluh rebound announcing itself.
There have been a lot ofquestions in 2020 about the
value of revenue management ifthere is no revenue to manage,
and and I always say I wouldhave agreed maybe seven, eight,
(03:59):
nine years ago, um, withtraditional revenue management
approaches that really looked atum the peak periods and
compression days of high demand,managing inventory and managing
opening and closing rates.
But the the approach to revenuemanagement has really changed
now.
It's really more about pricingand it's more about inventory
(04:20):
management.
And if you look at the rightprice is still relevant, I would
argue it's even more relevant ifyou're at 20 or 30 percent than
if you're at 90 or 80%, becauseright now hotels need every
single euro or pound or dollarthat they can get in order to
pay their lenders at the end ofthe month, make payroll, keep
(04:43):
their people employed, um, andjust get through this crisis,
get through the next six toeight months.
So I would think revenuemanagement, because it has moved
on from where it used to be, isum as important and as critical
as it has always been.
And there's a couple factors, ifI if I could just expand.
Um, one is that we have seenthat people at the hotel and at
(05:04):
the corporate office need umaccurate and trustworthy data.
And the revenue managementsystem, together with the
property management system, isusually the system that has the
most accurate description ofdata.
It's the closest to the sort oftruth that you can get.
You need to be able to forecastnot just for revenue management
purposes, but also for laborlabor planning and resource
(05:26):
planning uh focus uh purposes,and you need to automate the
distribution of your pricingdecisions and your rates through
as many channels as you can, andyou need to do that, especially
now with the least amount ofpeople and the least amount of
manual interaction possible.
So, because of these threefactors all coming together,
they remain critical, andrevenue management therefore
still remains very critical.
SPEAKER_01 (05:47):
Klaus, before we go more into where is the future of
revenue management and theaccommodation industry,
actually, because obviouslythat's very tied together from
our perspective, can you explainus a little bit how you manage
the last year?
Because essentially, when I lookat those systems that are there,
um they are obviously builtaround certain models.
(06:08):
And the models in 2020, Isuppose, were totally different
from than any year before thatum uh that that crisis here.
So, how are you able tocalibrate the systems and
respond to the changing demandand ups and downs and
everything?
Because I think that's a veryinteresting question for the
(06:28):
people that are listening.
SPEAKER_00 (06:29):
Yeah, absolutely.
And Ula, you and I we've been onmany stages and we've discussed
many times the value of man andmachine or man versus machine.
I think this was that the last12 months have really proven
that it is a man and machinescenario, not a man versus
machine scenario.
So that the first thing that wehad to do was make sure back in
(06:50):
uh March-April, we made surethat our hotels that are working
with us around the world areproperly equipped to deal with
the high level of uncertainty.
So we uh spent the first fewweeks, I would say six to eight
weeks, to making sure that thehotels, when they're closing, uh
obviously proper the systemknows that hotels are closing.
(07:13):
The system understands thatdemand periods have changed and
demand patterns have changed,and we had to do that manually.
There was just no other way todo that.
We had to tell the system thatwhat is happening right now is
not a normal situation.
Um, and we went in and made somesignificant changes to our
algorithms to put more weight onthe most recent past than the 12
(07:36):
or 13 or 18 months past.
Um we do incorporate a lot offuture demand uh uh signals into
in our system.
We work with uh companies likeTravel Click for the demand 360.
We incorporate some SDR data forinformation purposes.
So we look at forward-lookingsignals that help the system
understand what's going on, andobviously that's been very, very
(07:58):
critical.
Um, but first we had to teachthe system that what's happening
is out of the ordinary.
We told the hotels to setspecial event periods or make
sure that the flag in thesystem, the period that they're
that they're in, that that thesystem understands that it's not
something that is going tohappen again.
And then when demand came backin the summer, we had to tell
the system that now demandstarts coming back.
(08:21):
Um, tune up the sensitivitiesand tune up the decisions.
And now, as we're going throughthe third or or second or third
lockdown periods, we're we'regoing back again and telling the
system that there is anotherlockdown.
So we're kind of applyinglearnings from March into the
current lockdown scenarios.
Um so we kind of know now how tohandle that.
And as soon as we see demandcoming back, we will tell we'll
(08:42):
go back in and tell the systemthat what what is uh what the
system is seeing now will be thethe normal trends going forward.
So we're constantly working withour 14,000 hotels and making
micro adjustments to thealgorithms.
SPEAKER_01 (08:56):
Understand.
Very interesting.
And I mean, one thing we we sawin our user base was that
essentially a lot of hotels andgroups were closed, obviously,
during that period over here inEurope.
But we um in fact had a numberof clients that were pretty
successful even during thecrisis, either during a certain
period, let's say summer of lastyear, summer season of last
(09:17):
year, or throughout the wholeperiod and keep kept the hotels
open.
Do you have an estimation?
Well, I mean, your client baseis obviously huge worldwide.
You have a million hotel roomsor so with ideas.
I and was my last information,maybe it's grown since.
But do you have any informationhow many of your properties um
kept uh were kept open and whichwere the good ones uh among all
(09:42):
of these crisis hotels lastyear?
SPEAKER_00 (09:44):
Um yeah, if I remember it right, I think at
the peak of the lockdown inApril, June, I think 70% of the
hotels that we work with.
So we currently have 14,000hotels that we support.
Um 70% of them were closed.
Um we're now back to I think 90%or 80% of the hotels back open.
Um obviously in the UK it'sstill very difficult.
(10:04):
In parts of Europe, it's stillvery Europe is still very
difficult.
The US has always kept theirhotels open most of the time.
Um China obviously veryaggressive in February, but
since then have re haverebounded with most of the
hotels looking at about 60%occupancy.
Um in we have about 400 hotelsin China that we support.
So it's been it's been kind of abig drop in April, May, 70, 70%
(10:29):
of the hotels closed, and thenuh since then a nice rebound.
SPEAKER_01 (10:33):
And and when you look at kind of the system side,
um I must admit from ourperspective, we have learned a
lot of things.
Actually, what was fascinatingfor us to watch that uh was that
last year we had a number ofrecord months in a row.
Um because we are able to doimplementations onboarding in a
certain way.
It's it's very lean, it's veryfast.
(10:56):
What are your learnings fromfrom last year?
I mean, when you when you sayyou want to position revenue
management now for the futurefor the accommodation industry,
what things are you changingwithin the system and also
within the procedures you'reusing to onboard clients?
Have there been any adaptationsor main changes from that
(11:16):
perspective?
SPEAKER_00 (11:17):
Yeah, the first thing that we did in we worked
with all of our clients to helpthem through this very difficult
time with relief efforts, right?
So we we extended uh credits, webecame more flexible in our
payment terms and invoicing, andwe really worked very closely
with all of our clients, whichwas very highly appreciated, uh,
to make sure that we understandthe financial situation that
(11:38):
they're in, right?
So that was the first part.
Now what we're seeing isactually through through the
second part of 2020, there's twobig trends that we're seeing.
Uh, one, uh, a couple of the bigbrands have decided to take this
opportunity to uh replace theirrevenue management technology
with the latest um you know nextgeneration technology.
(11:59):
And uh we were fortunate enoughthat um you know we had we have
continued to innovate andcontinue to build um new tools
and new platforms and and newrevenue management technology um
that uh that that they wereinterested in or that they uh
they were able to adopt.
Um so um there is a big amountof investments going into
(12:20):
upgrading revenue management uhsystems right now.
Um on the other hand, we're alsoseeing uh a strong interest in
tools beyond revenue management.
We launched a uh operationalforecasting tool at ITB last
year, which probably nobodyremembers anymore.
But uh it's called it's calledexactly it's called Ref Plan,
(12:41):
and with Ref Plan, hotels canforecast their overall revenues,
their total revenues, uhincluding F and B meetings, and
they can also use that to planfor their entire operation.
Um so we have a Ref plan inplace, I think at uh over five,
six hundred hotels right now.
Very, very strong feedback.
Some hotel companies have toldus they wouldn't be, wouldn't
have been able to go through thebudgeting uh process this year
(13:03):
without a tool like that.
Um so we were very fortunate init to be in a situation where we
had something ready that helpspeople not just with revenue
management, but also withoperational problems,
operational forecasting,understanding total revenue.
SPEAKER_01 (13:17):
Okay.
Ideas has been around for manyyears, obviously, very
successfully.
SPEAKER_00 (13:21):
30 years.
SPEAKER_01 (13:22):
30 years, yeah, crazy.
I've spent more than 10 years ofmy life with the life with the
company.
SPEAKER_00 (13:28):
That's why you lost all your hair, Uli.
That's what it is.
SPEAKER_01 (13:30):
Yeah, exactly.
That was the hard time at Ideas.
You are having the fun timesright there.
So going backwards, I mean, yoursystem is obviously a very um
solid one.
It has good history.
Um, you know what you're doingboth with the system as well
with the procedures.
(13:51):
Um today I've met a lot ofhoteliers and hotel uh hotel
groups that say we want to gorather with lean revenue
management than in the past.
So some of them, obviously, thegroups might stick to the bigger
systems, but there are others aswell that say um isn't isn't
there anything kind of easier,faster, quicker to implement and
to use?
(14:12):
Now I'm aware of obviously theideas pricing system um rather
than the full system.
Are there any other efforts tomaybe look at developing new
systems from your perspective?
Or are you at this momentenhancing what you currently
have?
SPEAKER_00 (14:27):
Um both, Uli.
And and um I think I think thereality is that um revenue
management, as I call it, getsmore and more democratized,
right?
In the beginning, when when whenyou were with Ideas, a very
small number of hotels couldafford a revenue management
system.
I remember when I uh uh receivedIdeas in 1998, uh it was a
(14:49):
six-figure price tag, right?
And a big box and lots of floppydisks that we had to uh you know
put into the system to load itall up and get it started.
Um, for the people that rememberfloppy disks.
And it's true that um our pathis uh democratizing revenue
management so as many people canuse revenue management tools as
possible.
(15:09):
And with that comes asimplification of revenue
management systems.
We need to be able to putrevenue management systems in
the palm of people's hands ontheir phones.
We realize that people can't,you know, they don't want to sit
hours and hours in front of adesktop computer anymore.
They want to get pricingdecisions very quickly.
Maybe they can only spend 10-15minutes a day on revenue
(15:30):
management and pricing areas ifyou're an owner-operator or a
general manager of a smallerhotel.
So our path is towardssimplifying revenue management,
making the tools easier, makingthe integrations and connections
seamless, as you know, Oli,you've been on this path as
well.
And uh just in general, scale upthe uh the adoption of revenue
(15:52):
management tools significantly.
And and I can't go into thedetails today, but you'll see a
significant increase of thenumber of our hotels that we're
supporting over the next um 18months.
Um and that is one of the that'sthat is one of the outcomes of
the effort in innovation, uhbuilding new tools, building
(16:12):
simpler tools that we have gonethrough over the last couple of
years.
So if you if you look closely atour website, website, you will
see the number very, veryquickly increasing from 14,000
to way beyond that.
SPEAKER_01 (16:24):
Great.
And um actually you mentionedsomething which is very
interesting and uh which has todo with integrations.
I mean, I remember doinginterfaces for you was always a
kind of struggle, not because ofyour technology, but obviously
you need a lot of data.
So you want a lot of data fromthe PMS, but also from other
sources in order to come up withthe best possible forecasts.
(16:47):
But you also want them todistribute the decisions and
pricing to different systems,not only to the PMS.
And in the past, that has alwaysbeen a pretty long procedure
because the PMSs are sodifferent, the distribution
systems are so different, it'shard to get the right data from
them, it's hard to distributethe right decisions again.
So I believe you've been doing alot of work on your side on how
(17:10):
to integrate to differentsystems.
SPEAKER_00 (17:12):
Um absolutely.
And part of that is thanks tocompanies like yours, only
right.
Um, apaleo and others have shownthe way that um integrations
don't have to be complicated.
They can be a plug-and-play orcan be done overnight or within
a couple hours, like like Apaleodoes.
Um and we're on that same path.
(17:33):
You know, we do want to makeintegrations easier.
We feel you know, they shouldn'tbe uh breaking the bank for
hotel companies.
They shouldn't take six monthsor nine months or two years to
accomplish.
And we've always struggled withthat.
As we connect to more and morehotels, we we have to connect to
smaller and smaller propertymanagement systems and smaller
(17:56):
and less sophisticated tools,and that makes integrations um
uh pretty hard.
Some of our integration worktakes years to accomplish.
Um, and that's not the future,right?
You've talked about APIs andyou've talked about modern ways
to connect with each other'ssystems, and we firmly believe
we should be all part of oneecosystem that we can easily
(18:17):
integrate and connect andexchange data with.
And that we're on the same path.
We're working on APIs, we'reworking on uh different ways of
creating uh connections andinterfaces.
So I think it'll for theindustry it'll be much easier in
the future to just plugdifferent systems in whenever
the need arises.
SPEAKER_01 (18:35):
Cool.
And and uh when we talk aboutthe future of the industry, um,
I mean, we we have been speakingwith a lot of hotel groups,
hotels, owners, operators,investors over here in different
parts of the world to figure outwhere all of this is going.
Um and and I think there you seea lot of traditional hotel
groups that are there and don'treally know how to react to the
(18:58):
crisis.
They are there and say,hopefully it will kind of come
up again, demand will be thereagain, it will return to what it
was before.
However, we also see quite someplayers that are using that
opportunity actually to come upwith totally new concepts, with
hybrid businesses, um, mixedbusinesses.
There are a lot of new ideaswhich actually people are
(19:21):
putting into place in theaccommodation industry right
now.
And I mean, Oyo and Airbnb havebeen there for a while, but I
see lots of players coming up indifferent European countries.
What is your general um feelingwhere the industry is going?
I mean, will it be again thesame type of hotel we have seen
(19:41):
for the past 30, 50, whateveryears?
Or do you think there will be aradical change to the industry
in many ways?
SPEAKER_00 (19:49):
Um I think it's a really, really exciting time
because um I don't think I'veever seen the amount of
entrepreneurism and uh startupmentality and innovation and
creativity in the accommodationspace ever.
And and a lot of people arecoming up, as you said, with
very, very creative ideas.
(20:10):
And I think if our core doesn'tbuy all of them up and integrate
them into their own uhinfrastructure, um it's very
exciting that to see that uh wewill we we we are expanding what
it means to stay in to staysomewhere else, right?
Away from home.
Um I'm excited by you know thealternative accommodation space.
(20:31):
I'm excited about the mixed use,kind of where you have flexible
rooms, where you have likeCitizen M, the lot of a lot of
social spaces and meeting spacesthat you can interact with,
right?
That the work from home, Ithink, is going to stay in
certain areas of um of the worldand for certain industries.
So I'm very, very excited aboutthe change in accommodation.
(20:53):
And if we look at the forecastnow that Airbnb is uh is a
public company, right?
It's easier to get data fromthem.
Uh they're but they'repredicting a 30% uh I think
revenue increase next year,which is probably the only
accommodation provider in theworld that is really bullish on
actually 2021, right?
So it's uh uh it's very excitingto see how the the space is
(21:14):
evolving.
Um and I think it's great forthe industry.
It all keeps us uh keeps usengaged and keeps us um uh on
track.
What's interesting to see isthat some of these startups
there that started out in thealternative accommodation space
are now starting to buybuildings and converting them to
hotels, right?
So it's uh some of thesecompanies have started on one
side and moving to the otherside.
(21:36):
Hotels are moving from the hotelside to the alternative
accommodation side.
It's it's all becoming more andmore mixed, and it's all
becoming just about providing acustomer the right accommodation
for their purpose or for theneed that they have at the
moment, right?
SPEAKER_01 (21:50):
Yeah, and actually, I'm I just can confirm that from
our perspective on a smallerscale.
I mean, we see quite somebusinesses over here which are
using that crisis actually as anopportunity.
I mean, uh, talking about someof our own clients like
Limehome, Cozy Hospitality,Stary, and so on, those are new
(22:10):
companies that actually duringthe crisis received quite some
big um investment from partiesthat say this is actually a
concept that can survive at anytime.
Um, and and some of them havebeen running occupancy
throughout the year of 60, 70percent, even though most of the
other hotels were closed.
(22:31):
So we we think that's a bigopportunity as well and and and
should be used in in many waysby those people.
And we see more and more comingup.
Actually, what's interesting aswell, it's it's in many cases,
it's not hoteliers doing it.
It's not the kind of traditionalhoteliers, operators, owners,
but it's people coming fromoutside the industry that say,
(22:52):
you know, it's it has been runin the same way for the past 50
years, there must be a betterway to do accommodation business
today.
And some of them are reallysuccessful, also using, I would
say, more hybrid technology thanin the past.
Because if you really thinkabout the changing demand for
those properties, um doing thiswith legacy system, let it be
(23:14):
revenue management or propertymanagement or whatever system,
is extremely hard because justchanging the configuration or
onboard a different uh hoteltype, uh, it takes them months
and months.
So we believe in this um tohappen much faster and the
onboarding and everything whichhas to do with it as well.
I agree.
(23:35):
And now one important piece isobviously um when it comes to
revenue management, there is alot of training and education
involved.
Um, have you been moving a lotof um that online or have you
been doing it before, or what isyour kind of perspective on how
to educate and train users andeven non-users of revenue
(23:56):
management?
SPEAKER_00 (23:57):
No, I you know, I always like to think about uh uh
when when a hotel or or anyaccommodation provider um gets
our system, they're not justbuying a tool or a system,
they're also uh joining thecommunity, right?
So they're joining right now acommunity of 14,000 users that
are also using the same toolsand probably similar processes.
(24:18):
Um the first thing, uh actually,one of the first things we did
obviously last March and Aprilwas move all of our training
virtual because we just didn'thave an opportunity to go to the
hotels anymore since they wereclosed.
Um we've always tried that inthe past, but what we found is
the industry always has apreference for face-to-face
(24:39):
training.
So our approach is we we givethe hotels what they like most
and what is most effective tothem.
So obviously during thelockdowns, we had to move
everything to a virtualenvironment and we're able to
train and get our hotels up andrunning completely virtual with
no problem.
We have seen over the last fewmonths as hotels reopen and
(25:01):
wherever it's safe in Australia,New Zealand, in Asia Pacific,
hotels are asking for us to comeback on site and train the staff
face to face, and we havetrainers around the world who
can do that as long as it's safeand it confirms with the
government regulations.
Um, so we're kind of in a hybridenvironment.
We have all the tools and thetechnology and the learning
(25:23):
platforms to engage peopleremotely.
We have a team of clientrelationship managers who speaks
to most of our hotels on everysingle month, um, like as a
buddy or mentor, and engageswith them.
But we can also do thatface-to-face if people want us
to come on site.
So we're we're our one word, Iguess, is we're flexible and
we're we're open to do whateveris works best for the hotel.
SPEAKER_01 (25:46):
Understand.
Now, when I we you mentioned acore before, and um in fact
you're right, they have beenbuying and are buying a lot of
different businesses, and theyare actually also converting
their own hotel group with newproducts or to different
products.
So the CEO announced a lot ofchanges to the account in
(26:08):
general.
Um one personal question.
I mean, I always like, forexample, the 25-hour suit
product.
I think it's a great hotelproduct, they have very nice
hotels, and obviously our coreare now taking control.
If you would go around the worldpersonally and say outside those
big groups, are there threeclients where you would say this
(26:30):
is really a hotel accommodationproduct which really impressed
you, both from a hotelperspective, but also from an
operating perspective.
So making money out of hotels orincreasing the value for the
owners?
Um, anybody that that strikesyou there?
SPEAKER_00 (26:46):
Um I'll have to think about it a bit.
You know, I I um um I'mindependent of client or not
client, right?
So I think what Accor is doingis really great.
They're really a lifestyle brandrather than a hotel brand.
Um the mama shelters, the25-hour hotels, SBE in the US,
right?
They have been incorporatingsome of these more uh
(27:07):
lifestyle-focused brands intotheir brands, which makes the
company a different company.
I think it's great, and I thinkit's a sign of how a hotel
company needs to pivot and needsto evolve with the evolving
consumer demand.
Um, I agree, you know, 25 hotel,25 Hour Hotel is a great, is a
fantastic company.
(27:28):
It would be one of the companiesand one of the hotel hotel
groups that I would look to as aas a good example.
Um, in Asia Pacific, you haveComo hotels, which is similar,
right?
Boutique high lifestyle hotels,uh, which is great.
There's a company in the US,it's called Under Canvas, which
are luxury tents and clamping.
(27:48):
I've used them a few times, andthat's just a great experience
when you're out in desertsomewhere and you're you're
you're in a luxury tent.
Um not cheap, it's still two orthree hundred dollars a night,
but um you get the wholeexperience of sleeping under the
stars in a nice environment.
Um Citizen M always comes up,right?
I everyone talks about them.
(28:09):
I just love their company andwhat they do, and and uh the
leadership team is alwayspushing the boundaries, as we've
seen over the last few uh monthsas well, with the launch of
subscription services for bothindividual and corporate
travelers.
So I think that would be on anon-traditional hotel world,
that would be my topics.
SPEAKER_01 (28:27):
Yeah, makes a lot of sense.
I mean, I see some some newplayers here.
Um what we see happening, whichis a trend really, is that those
hotel accounts that are poppingup now, a lot of them are
tech-driven hotels.
So they look at um operating thehotels in a different way than
in the past, much more efficientthrough automation and
(28:48):
technology behind.
We see where that that trendwill go.
Obviously, there is still afive-star segment like the
Mandarin Orientals of that worldthat will operate on a high
service level with staff, butactually everybody else could
really use technology toautomate much more and work much
more efficiently than in thepast.
SPEAKER_02 (29:08):
So, gentlemen, we are coming to the end of our
conversation.
And Klaus, I just want to askyou, in your perspective, are
there any critical items whichyou believe really need to be
discussed and brought to theforefront to really help prepare
the accommodation industry forthe future?
SPEAKER_00 (29:25):
No, I I think everyone right now in the
industry needs to have a hardlook and evaluate and rate
themselves how ready they arefor the rebound.
Right?
It's unquestionable there'sgoing to be a recovery and that
there's going to be a rebound.
Uh, it's not an if, it's when.
It's just the question is whenit's going to happen.
(29:46):
Some some will see it, some arealready seeing it in parts of
the world.
I guess the most of the Westernworld will start seeing it in
June, July with the summermonths, and then getting into uh
September, October.
Um, so now is the time toprepare.
Yourself now is the time to lookat your technology stack.
You know, do you have the righttechnology in place that will
(30:06):
make it easier for you toconnect other systems and other
technologies?
Do you have the rightinfrastructure in place and the
right structure?
Right after this call, I'm goingon a I'm getting on a call with
a CEO of a company in Europethat has some questions about
centralizing their revenuemanagement and automating their
revenue management approach.
(30:28):
So is your current structure thebest structure you can have for
the future?
Do you have the right ways toget access to clean data and
accurate data that you cantrust?
And then are you able to runyour operations and run your
revenue management and run yourmarketing and sales as efficient
as possible?
You need to spend the next sixmonths to get ready for the
(30:51):
rebound when it happens.
This is the ideal time.
Obviously, funding is always auh is always a question, but
this is the ideal time toprepare yourself.
SPEAKER_02 (30:58):
Absolutely.
So, what's on your agenda forthis year?
SPEAKER_00 (31:02):
Um, you know, I was just telling Uli that I would
love to go over to Europe and goget some skiing under under my
legs, I guess.
Um, but I'm not sure if that'sgonna happen.
So um I think my my my numberone priority would be to um be
able to go over to Europe andsee my family.
I still have uh parents andbrother and sister in Austria,
(31:22):
and I haven't seen them in ayear.
So that would be the first thingI would do when travel is safe
again.
So um at the moment uh I'mstaying safe here in
Minneapolis, but as soon asborders are becoming a little
bit ordered, the situationbecomes a little bit more um
forecastable, I would say, oruncertain or certain.
Uh I would you find me on theplane over to Europe.
SPEAKER_01 (31:43):
And hopefully then you'll see some old friends here
in Munich as well.
SPEAKER_00 (31:46):
Of course, Uli, of course.
I'll work out of your office.
How about that?
That's right, thank you.
SPEAKER_02 (31:55):
Thank you so much, Klaus, for joining Uli and
myself today.
It was a pleasure getting tospeak with you, and hopefully
we'll be able to see you soonover here in Munich.
SPEAKER_00 (32:04):
That would be great.
I'm looking forward to it.
Thank you very much forlistening, and I hope you found
this episode valuable for yourown business circumstances.
Check out the show notes, linkto the episode.
Help more people in the industryfind this podcast by sharing and
rating.
And don't forget to subscribe tothe series wherever you listen
to it.
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