THE BULLETIN
Off the Plate
EDITORIAL David Eisen Editor In Chief
In baseball, off the plate describes a pitch that lands outside the strike zone. It’ s otherwise known as a ball, but it doesn’ t mean the hitter won’ t swing. There has been no shortage of companies through time that have developed and launched products and brands outside their core offering— beyond the borders of their strike zone. Some have failed spectacularly; some have been home runs.
If only Amazon stuck to selling books and Virgin Group stayed peddling records.
Toward the end of April, Uber, the car-riding service famous for 15-minute wait times before being cancelled on, announced it was adding a new feature through a partnership with Expedia Group that allows Uber customers to book hotels directly in the Uber app, a selection that it said would ultimately grow to more than 700,000 properties globally.“ Uber is becoming an app for everything,” declared CEO Dara Khosrowshahi.
In the same way Uber is launching offerings outside its founding core product, Airbnb, the short-term rental company where guests need a safecracker to open the door, decided STRs weren’ t enough and were like—‘ What if we added hotels?’— the very things that were once anathema to Airbnb. Totally sensible.
It’ s rare these days for companies to remain entirely faithful to their swim lanes. What Amazon did and Uber is doing is not entirely dissimilar to what some hotel companies are embarking on today.
Part of the reason they can do this is because of their vast audience of loyal customers, who, for better or worse, are happy to stay within a certain ecosystem if they are rewarded. Consider the biggest: Marriott International, whose Bonvoy loyalty program numbers more than 280 million people. Though its core product is traditional hotels, it’ s gone adjacent in recent times, having launched a homes and villas brand and an apartment brand. At the same time, people buy and live in residences that are branded St. Regis and Ritz-Carlton.
As Chekitan Dev of the Cornell Peter and Stephanie Nolan School of Hotel Administration puts it, travel brands are moving from a brand-portfolio to a brandplatform strategy that serves complementary but distinct offerings to customers within their travel spheres of influence. Companies like Uber, like Marriott, like Expedia with vast sums of members are creating what Dev calls“ super apps” and monetizing their user base.
Like Dev, McKinsey & Company argues that companies launch alternative services from their core by pivoting from product-centric models to service-oriented ones that can be data-driven or AI-enabled models that expand on existing capabilities by leveraging data to identify customer needs that they are then able to satisfy.
A company’ s greatest asset is loyal, high-trust customers. Companies that have that can more easily launch services outside their core product to drive growth and increase customer retention. This strategy is less focused on one-time transactional exchanges and more focused on providing ongoing value.
It’ s a strategy that starts outside the strike zone, but when it comes
David Eisen down to balls and strikes, customers tend to use their best judgment.
Editor In Chief
Tatiana Valenzuela Editorial Coordinator
Juan Cruz del Val Designer
Contributing Writers Derek Herscovici and Meagan Drillinger
PUBLISHING Ali Jahangiri CEO
Brian Levine Publisher
INTERNATIONAL ADVISORY BOARD Gilda Perez-Alvarado Group Chief Strategy Officer, CEO of Orient Express, Accor
Arash Azarbarzin CEO, Highgate
Danny Hughes President, Americas, Hilton
Jeanelle Johnson Partner, PwC
Raj Chandnani EVP & CDO, WATG
Cindy Estis Green Co-founder & CEO, Kalibri Labs
Raúl González CEO EMEA, Barcelo Hotels & Resorts
Alan Fuerstman Founder, Chairman, CEO, Montage International
Patrick Scholes MD, Lodging and Leisure Equity Research, Truist Securities
ADVERTISING Caroline de Donnea José Sylvester
ADMINISTRATION Kristi Carlson Kimberly Guidry
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