TECHNOLOGY : REVENUE MANAGEMENT
“ REVENUE MANAGEMENT AND E-COMMERCE WERE TWO DIVISIONS THAT UNTIL VERY RECENTLY HAD LITTLE INTERACTION OR COMMUNICATION . TODAY , THE REVENUE MANAGEMENT TEAM ’ S ACTIVE AND CONSTANT INVOLVEMENT IN E-COMMERCE IS CRITICAL .”
– SASCHA SEEFRIED , REGIONAL REVENUE MANAGER MIDDLE EAST , KEMPINSKI HOTELS
“ I remember 15 years ago when I was on the board of directors of the Hotel Electronic Distribution Network Association and Microsoft asked if they could speak at our conference ,” says Michelle Woodley , senior vice president of distribution and revenue management , Preferred Hotel Group , Chicago . “ At the time we could not imagine what they thought they could do in the travel space . Their presentation was the first time anyone in our audience heard about what we now know as Expedia . We must listen and stay attuned to how our customers are changing their behaviors and which companies are enabling the changes .”
Exactly which moves Apple , Google , Microsoft , Facebook and TripAdvisor will make with online booking remains to be seen . Some analysts are skeptical that any of them will choose to become online travel agencies .
“ Becoming the merchant of record will annoy advertisers ,” says Robert Cole , hotel technology consultant and founder of RockCheetah , Menomonee Falls , Wisconsin . “ If they want nice advertising revenue coming through , do they want to exclude Expedia , Travelocity or Priceline by becoming the merchant of record for online booking ? Continuing to do metasearch is an easier path for them .”
However , given their advantages , the metamediaries may find online travel booking too lucrative to stay out of the game . “ I think we are not very far from having Google and Facebook enter the travel sphere by actually launching their own OTAs , so it is extremely important to follow how this landscape changes ,” says Aditi Verma , corporate director of revenue management , Northview Hotel Group , Westport , Connecticut .
Some hotels are already changing their approach to online distribution in light of the potential moves from the metamediaries . Kempinski Hotels , Geneva , has increased the collaboration between its e-commerce and revenue management departments .
“ Revenue management and e-commerce were two divisions that until very recently had little interaction or communication . Today , the revenue management team ’ s active and constant involvement in e-commerce is critical to maximize opportunities and reduce risks ,” says Sascha Seefried , Kempinski ’ s regional revenue manager , Middle East . “ The question that remains is how much power we are willing to give the metamediaries over our own inventory and prices and whether we have learned from the rise of the OTAs . The precedent set today will determine the industry economics for the future .”
Escaping the silo Increased cooperation with the other departments will be coupled with increasing responsibilities for revenue
MARKET CAPS : METAMEDIARIES VS . HOTEL COMPANIES
58 HOTELS September 2013 www . hotelsmag . com