Spanish Hotel Chains set-out
Internet Distribution Strategy
June 09, 2005
Spanish hotel chains are taking control over their ecommerce distribution by making several important decisions to their strategy.
Online distribution is a market that has developed from nothing into one of the main resources of reservations for hotels in Spain in the last 5 years. From being used to work with the classic tour operators the hotels have been slightly taken by surprise by the growth of the ecommerce market at first. In no time it represented 20 to 40% of their market mix. It is a very powerful distribution channel. Of course the hotels realized they had to take advantage of this and promote direct sales through their own websites. The larger chains and savvy smaller operators and independent hoteliers seem to be doing a good job and are making a comeback in this field nowadays.
In terms of operations the internet distribution market is still a big challenge. Hotels are often working with a range of 10 to 30 companies, and maybe more in the case of independent hotels not benefiting of a large marketing and sales platform, to distribute their product. They need to manage their prices and availability with all these IDS and TO portals through the individual extranets, which is costing them 2 to 4 hours per day. It is a labyrinth to work through and almost impossible to control. It is a real challenge to have any form of consistent pricing across the board as it will take around one hour to change prices for just one week. Imagine if a hotel has to update his complete strategy for the next 3 months. It is two or 3 days of work.
The solution to this problem are so called channel management tool which have been recently entering the market. . Rate Tiger by eRevMax.Inc. seems to be making important strides towards market leadership. Many of the large chains in Spain as well as independent hotels have started working with their products and the results have been above expectations. Silken, Sol Meliá, Barceló, Vincci, Abba, H10, Habitat, Nuñez y Navarro, HCC, Santos, Med Playa and many independent hotels and small groups are now using RateTiger Allocator to take a necessary control of operations and strategy in Internet distribution.
The RateTiger Allocator solution they are using allows hotels to manage all the rates, availability, etc with all the IDS and TO portals from one screen. It is an interface that saves them around 75% of their time. The tool gives the hotels back the control over their inventory and prices. They can once again make decisions on their selling strategies and implement them in a matter of minutes instead of hours and days.
Critina Roures, Director Comercial at Hoteles Silken commented ‘We have been using RateTiger’s solutions for over a year now and it has brought us great results. The RTShopper technology allows us to make better informed decisions. We can exactly see what prices our competition is selling at and combining this with our internal information set out a calculated strategy. Our hotels are now managing about 20 portals with the RTAllocator, which is much more then they could before. And they are not only managing more sites than before, they are actually able to do it in a shorter amount of time as well. Having been able to offer competitive rates and availability to more channels, we have seen a substantial effect on our bottom line.
And they are not the only ones recommending the product. ‘Being a local group it is very important for Vincci Hoteles to give a lot of attention to the 3rd party websites. They represent a large part of our business and we need to optimize our distribution strategy with them. Before using RateTiger we used to have a hard time to control all our rates and availability with them. But now we have managed to implement rate parity and are sure we are available for sales on all the channels at the same time. As a first step we have started with our main 15 providers in each hotel. The next stage will be to expand our portfolio in RateTiger to offer competitive rates and availability to more local and some of the smaller European channels to increase our exposure in the market and generate incremental revenues. RateTiger really allows us to play the distribution game.’ Said Carlos Rentero, Corporate Revenue Manager at Vincci Hoteles.
Mr. Javier Silvestre, Globale VP of Distribution at Sol Meliá commented, ‘We have tested the RateTiger technology in some of the key properties of Sol Meliá over the last 6 months and are very satisfied with the results. The great thing about RTAllocator is that they do not only have interfaces with the large global websites. They also are connected with Spanish portals like Halcón Viajes and Transotel as well as local websites like Barcelona-online.com. We are now slowly expanding our relationship with RateTiger and will implement it in more hotels. If we like the results we will look into rolling it out chain wide. ’
But the large international and national chains are not the only ones using RateTiger. Also smaller groups and independent hotels are on board. ‘At Nuñez and Navarro we have also started using RateTiger. It has been key for us to be able to control our prices on all these websites. In a short time we have been able to save a lot of time loading rates and get a good grip on this. We are starting to see some results.’ said Eva Bimbela, Director Comercial de Nuñez y Navarro.
Multiples IDS channels also seem to appreciate what RateTiger is doing. Alfonso Paredes, Director of CNG Spain noted ‘A solution like RateTiger is actually helping us getting more hotels contracted. At one point hotels cannot work with more companies and this is the perfect solution. We have developed a very good relationship with them. We are for instance in the process of changing our extranet and are working closely together to make sure it also goes smoothly for RateTiger clients.’
‘Creating RateTiger came forth out of working in the hotel and ecommerce industry as revenue directors in different parts of the world. We had to deal with the daily challenge of working with a large amount of distributors ourselves. We focus on delivering solutions that assist hoteliers in creating or improving an ecommerce strategy. Something they really need and works the way they want to. We have actually built RT together in cooperation with some hoteliers. NH Hoteles and Swissôtel in Amsterdam, the Netherlands helped us with beta testing the tool.’ said Patrick Landman of eRevMax. ‘The success of RateTiger lies with the hotels. They let us know what type of solution they require and we aim to develop it according their needs, and set out a direction which works for everyone. Our solutions, RTShopper and RTAllocator are useful for any type of hotel, small or large, belonging to a chain or independent. The time saving alone will justify the cost. On top of this products like these will allow you to focus on implementing your ecommerce strategy, in stead of having to worry about how to control your operations that directly influence 20 to 40% of your total revenue. Moreover, expanding your exposure by working with multiple third party providers on the internet will impact the bottom line of a hotel.’
It seems the future is changing again and solutions like RateTiger will play an important role for hotels in Spain to play the online distribution game.
Related Link: RateTiger