Your Phat Data strategy can reveal a treasure trove of negotiating power with your hotel partners
By Jennifer Steinke
Discovering the hidden truths in your hotel data is more difficult than it should be. It is a complex ecosystem of corporate brands, franchisees, hotel management companies, online content, offline content – and the managed travel program. Over the years, nothing has really changed in the landscape of frustration when it comes to challenges buyers face both during and after the dreaded hotel RFP season. Most industry stakeholders would agree the process is broken.
It is only May and there are already many buyers who are starting to think about and prepare for the launch of their 2020 program. Most buyers enter into the hotel RFP vortex for at least three months. They are tasked with making decisions based on the ability to capture accurate data within their own systems, whether it comes from the TMC, expense, corporate card, or wherever. They are also frustrated with the extreme differences they see when comparing their data to the actual hotel properties data.
Even after all those issues, once they complete the actual RFP process, they enter into the rate loading marathon. Why a marathon? Because no matter how fast a buyer runs to get those rates loaded, it seems the finish line keeps moving. Rates are inaccurate, loaded one day, gone the next. Mid-year starts the vanishing rates. Oh, let’s not forget the squatters! When a buyer does find out about these problems, it’s often long after the fact; the data is not actionable and the money is already spent.
So, what is a buyer to do?Buyers have the option to do random rate audits – the key word being random and again not a very stable process.
New Tech to the Rescue Now imagine the day when you have accurate and actionable data that helps build your hotel sourcing strategy. Next imagine you can take your hotel contracts and load them into a system that will audit every hotel booking and match it up against your hotel contracts, looking at things like room type, rate, amenities.
anomalies in real time so you can choose whether you want to take action to rectify the situation – in real time.
Yes, buyers, this is happening. In the Phat Data quest for accurate near real-time actionable data, there is a new game in town and it is PHAT!
Enter Smart Hotel Rate. Buyers and suppliers both know technology can make or break the data story and this new technology entrant has the ability to open doors to insights for the travel buyer on their hotel program and its actual performance more than ever before.
One of the world’s largest blockchain companies has ventured into the travel space. When talking about this new opportunity to deliver some Phat Data, John Packel, Hard Core Decentralization Developer, co-founder of Ansero a Consensys start-up, explains, “RFPs and contracts are an abstract view. What everyone really needs to understand is what actually.”
This is what has driven the Ansero team to build Smart Hotel Rate, because they believe “the faster anomalies are detected and addressed, the better off both sides are. The corporate buyer increases savings and control when the issue is rate loading, accuracy or their negotiated rate is lower than a TMC or consortia rate the traveler chose, and the hotels also benefit from clarity because they can then focus the conversation on their brand and shifting share."
Corporations, either individually or in conjunction with a TMC, can utilize the tool to provide live monitoring of the managed travel hotel program. In its simplest form, it works this way; the contracts from hotel rate agreements are compared to the actual booked data. This in turn enables the real-time information to be provided to the travel buyer through a dashboard. Now the buyer can collect and report on this hotel data real-time but can also take action on the booking.
Let’s say Hotel A has loaded a preferred rate on a suite, but you have only contracted for a standard room type. Smart Hotel Rate alerts the buyer that there is a rate discrepancy on the booking and what the actual difference is. It could be straight up rate-to-rate, it could be room type, it could be amenities, etc. The travel manager can opt to take action on that booking or – let’s say it’s a VIP traveler – maybe the buyer opts to let that suite booking slide. It is in the buyer’s hands to determine what to do with the information provided.
Everybody Wins Coupling the real time insights through the dashboard with the data that this technology can capture enables the buyers and suppliers to elevate their partnerships. Buyers can now have insight into which of their hotel partners are the most accurate – or the worst offenders. It allows buyers to get in front of travelers at the time they book the hotel stay and not after the stay is expensed. Additionally, it leads to more real time discussions between buyers and hotel suppliers.
Hoteliers too can benefit from this program by ensuring they are always at the top of the rate accuracy list. What an amazing story this to tell! Buyers can now take back control of their hotel program and make the decisions driven by a whole new set of Phat Data. Hoteliers can be more proactive and create new value for the buyers and the travelers. Hotels should be thinking about how they can now find rate discrepancies before their customers do. Buyers can now quantify the missed savings opportunities.
Another added benefit is the data that is being collected throughout the year. Imagine being liberated from spreadsheets. When buyers are able to access the data about all their bookings through a unique solution like the Smart Hotel Rate System, they can understand their spend with more insights than ever before. Coming to the RFP table with hard-hitting data about a property and the accuracy of their rates throughout the year changes the dynamic of the negotiations. At a minimum it can stop a lot of madness.
Now there is also the opportunity to put new service level agreements in place within your hotel program, maybe even some risk and reward clauses. The expectation of accurate rates shouldn’t be too much to ask, but buyers haven’t had the information they have needed to truly identify the problems and take action. In this new Phat Data environment, buyers will be liberated and free from the constant angst of wondering what is really happening with hotel rates.
It is no secret building out your Phat Data strategy takes accurate and robust data. This has always been challenging in the managed travel space and especially in the hotel category. Many buyers would make different program decisions if they have the true picture of how their hotel program is actually performing. Knowledge is powerful and using technologies like Smart Hotel Rate creates an amazing avenue for buyers to strengthen their hotel program.
Now that is Phat!
Jennifer Steinke is vice president Global Travel Experience at WHoldings, and an industry thought leader with over 30 years experience managing corporate travel. She holds an MBA plus Certified Corporate Travel Executive (CCTE) and Global Travel Professional (GTP) certifications from GBTA. Jennifer strives to deliver innovative and thought provoking ideas to the corporate travel industry.