Hotel Topics Hotels in the New E-conomy - An interview with Damian Hinds, Vice President E-Commerce Bass Hotels & Resorts
Bass Hotels & Resorts has been at the forefront of E-Commerce initiatives right since the conception of the internet. They were the first hotel company to offer guests on-line bookings, with www.holiday-inn.com launching in 1995 and www.interconti.com a year later. Anticipating the phenomenon of on-line travel, Bass set up a direct interface between their on-line reservation systems and the company's central reservation system (CRS).
We have three areas of priority at Bass in terms of our E-Commerce strategy, these being improving business efficiencies and reducing costs, generation of incremental sales and boosting our customer loyalty program. Firstly, the internet has the potential to improve our margins. This is by making our overall business processes more efficient and hence reducing costs. We can improve our efficiencies both at the corporate and hotel level in terms of procurement, communication, reservations, billing, management information systems, marketing program administration and recruitment.
Secondly, E-Commerce is set to yield significant incremental sales, not only to Bass, but to the industry as a whole. The internet has the potential to expand the size of the travel market due to the ease of access and the information rich nature of the web. Travel now appears a much more attractive proposition for discretionary spend. The internet also creates the potential for new business models. For example travel operators are able to reach the consumer directly which they had previously not been able to do - cutting out the middle man. In addition, we have seen the establishment of reverse auctions and last minute clearing houses, such as Priceline in the USA and Last Minute in the UK, targeting the price sensitive sector. We utilise these intermediaries for package sales and "blind selling" so as not to direct the consumer away from our own websites.
These type of E-Commerce initiatives are helping us capture a greater number of incremental sales than our competitors. Our global network, representation across all price sectors and the financial commitment we have already made, means we can take full advantage of this new medium. Thirdly, E-Commerce has enabled us to engineer greater sophistication into our customer loyalty programs. The internet has allowed us to get close to our customers and proactively sell to them. Our technology allows us to monitor the number of hits we have per page and the conversion ratios. We can also determine where the user has entered our site from and where they leave to, at what point/page they enter our site and at what point they leave, vital information in marketing to our e-customers. In addition to monitoring daily use, Bass also conducts specialist market research surveys which examine detailed user behaviour, such as where users' eyes go to first on the page and ease of navigation.
Our e-loyalty program also allows us to determine the travel habits of our Priority Club members. When booking on line, our members are asked their preferences such as what type of bed they prefer and if they are a non-smoker. This information is locked against their customer number and any search they do in future will bring up products that match their travel preferences. There is a live interface between the internet booking system and the live Priority
Club database, to which the information is transferred and used in targeted marketing campaigns.
IN TERMS OF THESE OVERALL OBJECTIVES, WHERE DO YOU ENVISAGE DEDICATING MOST OF YOUR RESOURCES TO IN THE SHORT TERM? Obviously we will focus on our own sites,
www.interconti.com www.holiday-inn.com www.crowneplaza.com www.staybridge.com andwww.priorityclub.com
as our 'market place and marketing face'. These have been built to provide our customers with efficient sites that are highly functional, informative and quick to respond to their requests rather than concentrating on graphic images and interactive design. When a user logs onto our site, they are predominantly there to book a hotel room and we want to make this experience as easy as possible.
A large amount of traffic is directed to our sites via the major search engines and we need to focus our efforts on consistently having our sites appear high up on the search returns. One of the ways these engines search is by picking up 'meta-tags' which function as invisible labels on the website, which the consumer can't see but the search engine recognises. Our aim to come up on the first page of results every time a potential guest enters a search. Daily checks are performed to see where our sites rank in these search results. Again we tend to avoid extensive graphics on our sites as they are not picked up by search engines as easily as text.
One way of ensuring that we are returned in a high position by the search engines is to have a stand-alone site for our hotels in markets where there is a lot of competition. For instance, if you consider the number of hotels in the Chicago hotel market, your chances of appearing first on the list are less than slim. So what we have done is create a web address for the Hotel Inter-Continental Hotel in Chicago as
As well as focusing on our own consumer sites, we have paid a lot of attention to B2B sites as well. We have recently announced that we are exploring a European B2B web-based exchange in conjunction with Accor, Granada Compass and Whitbread. This exchange is intended to bring together hospitality buyers and suppliers to achieve more streamlined transactions as a result of the switch to web-based trading. By adopting leading-edge technologies, there is an opportunity to deliver benefits to all participants in the supply chain, including the customer. This new open and neutral exchange will signal the start of a new era in the sector, allowing participating companies to reach wider markets - both consumers and suppliers.
In addition to this European initiative, Bass has undertaken a similar agreement with Marriott International, Hyatt Hotels and Club Corp in the US. Avendra LLC (as it is to be termed) is expected to be the largest internet B2B hospitality procurement company and will allow Bass to
drive efficiencies by impacting the entire supply chain. The alliance will provide critical mass which will facilitate standardisation, improve economies of scale and offer the consumer better value. This initiative is again a big commitment of our resources, but we believe the returns will be fruitful and will benefit our owned, managed and franchised hotels.
The past 12 to 18 months have seen an explosion in intermediary sites such as
We have recently introduced a mapping facility to our websites, which is highly sophisticated and provides users with extensive location and destination information over and above that of many of our competitors. The enhanced mapping system allows our customers to use such features as proximity search, route planner, dynamic maps, driving directions and business/attraction finder, which is designed to take travel planning to another dimension. In addition, guests are able to select product features such as a pool, fitness centre, baby-sitting facilities and a whole range of other choices, resulting in only hotels with these facilities being featured on the suggested map. For example if a guest was travelling from London to Edinburgh, this mapping facility would provide you with the best driving route from a specific address in London to a specific address in Edinburgh. A list of all the hotels along your route matching their criteria within a one, five or ten mile range (depending on the option selected) would be generated and the guest can book at will.
Another initiative is our meetings site,
In terms of guest services, we will be launching a pilot version of our interactive online service at one of our Inter-Continental properties by the end of 2000 - IITV. The service is web enabled and directs guests to relevant information about the city they are in, such as shopping, entertainment & events, as well as forward booking other Bass hotels - basically an e-concierge. This not only enhances the guest's stay but is also a potential revenue generator for Bass through partnering opportunities and commissions. In terms of hoteliers we have launched a site
The most important thing to remember is to never be complacent. We don't pretend to know what the future brings, nobody does. We are going to be facing a changing consumer in the future - the majority of those who have utilised the internet over the past four years have been well educated and relatively high income earners. As this technology becomes even more widespread and accessible, we must keep redefining our on-line services and entire E-Commerce strategy to take account of the changing consumer needs. Adaptability is the key.
Damian Hinds, Vice President E-Commerce, Bass Hotels & Resorts
In his role as Vice President of E-Commerce for Bass Hotels & Resorts, Damian is responsible for all E-Commerce sales-side activity in Europe, Middle East and Africa. He joined Bass Hotels & Resorts in 1995 in Atlanta, then relocated to Brussels where he undertook an operational role. Other roles in development and strategic marketing led him to manage the relaunch of the Crowne Plaza brand in Europe. Prior to joining the firm, Damian worked for Mercer Management Consulting, specialising in telecoms and multi-site retail across Europe and USA.
Damian is a graduate of Oxford University and is currently based in London.