theWorks - the Nexus Blog

a tale of two cities

There is London and there is London Docklands. The former is the most vibrant, cosmopolitan, influential capital city in the world. The latter is a barren, God-forsaken wasteland where real life has had both the real and the life sucked out of it. Even the DLR trains seem depressed, shuffling around the network reluctantly and unreliably while their Jubilee Line cousins speed in and gratefully back out into the Metropolis. I contemplate this contrast every November when the World Travel Market rolls round again. As a Brit, there's always a feeling of local's embarrassment when accompanying the world's travel community as it negotiates the tortuous daily commute from comfortable West End hotel room, through Checkpoint Canary, to the gulag of Custom House. As many have commented, what hope for the Olympics?

Somehow the WTM itself - once a proud citizen of SW5 - has taken on the character of its surroundings. Arriving at Excel for registration last Monday morning, we weary travellers were (as usual) forced to descend an outdoor iron staircase into the bowels of this giant grey shed, then to endure a long walk along concrete corridors, through an underground car park, only to be faced with an endless line of fellow prisoners waiting to be strip searched and showered before being issued a pass. OK, I made up that last bit. But it was a really long line and there were only 3 people on the registration desk (sponsored by Greece perhaps?).

Once inside the halls, I headed directly for the Global Village where once upon a time the world's hotel groups gathered. Sadly these days it's more Village than Global. Most of the big chains have gone and their footprint has been gobbled up by OTAs, bed banks and channel management companies. Still, the silver lining of any WTM is in the silver hair of increasingly aged, long-standing industry friends and colleagues. WTM, for now, remains one of the best networking events in Europe. It's just a pity that even us Brits have to travel to another country to attend it.

we've got you covered

Back in the good old days a hotel could abuse its clientele with relative impunity; anything from rubbery chicken in the restaurant to a rude receptionist, even the death or dismemberment of a guest could be swept under the (filthy) carpet with barely a ripple of interest to anyone beyond the unfortunate victim. These days, it only takes one unsightly pubic hair in the shower of an otherwise spotless bathroom to send the world wide web into a frenzy of uploaded images, self-righteous pronouncements about 'appalling hygiene standards' and tales of infants too traumatized to take a bath. Result? Plunging TripAdvisor ratings and plunging revenue as potential guests head for hair-free alternative accommodation.

The only remedy available for the hotel is to explore the new dark art of Reputation Management. So, for example, publish statistics from an independent research company demonstrating that 99.99% of the hotel's showers show no traces of pubic presence, or send the housekeeping team for 'Pubic Hair Recognition' training and post their certificates online to prove it. Hopefully some creative CRM will steer the ship back to profitability.

The only remedy until now that is...

...because an enterprising insurance company has just launched a policy called Hotel Reputation Protection Policy 2.0. The policy will cover losses of up to $35m caused by adverse publicity, including both lost business (measured by RevPar Index) and the cost of crisis management consultants. What a marvellous concept! But why stop there? There's no end of risk to running a hotel and all sorts of good reasons for not achieving RevPar targets. This could be a very lucrative seam to mine for insurance companies, so here's a few ideas to get the ball rolling..

1. Owners Expectations cover. Having installed flat screen TVs in all rooms, your owner now expects ADR to increase by a minimum 50%, an assumption based on the entirely reasonable commercial proposition that he wants his money back quickly and someone has to pay for it. The policy will cover the difference between real world RevPar and LaLa Land RevPar.

2. Bad Sales Team cover. Everyone knows that good sales people are worth their weight in gold and desperately difficult to find and retain. So why waste your time? Go ahead and employ the laziest, dimmest dreamer of them all who doesn't know her BARs from her elbow and let her fill the hotel with Groupons. We'll cover the difference in average rate between what was sold and what would have been sold had you employed the right person in the first place.

3. Unfair Competition cover. Results would be so much better if it wasn't for the fact that your comp set is comprised of higher quality hotels in more convenient locations that have been more recently refurbished. Not only will we cover you for the RevPar you would be achieving if those properties didn't exist, we'll also provide Competitive Impairment, a customized service that involves placing our own undercover operatives into your neighbours' properties and sabotaging their service levels. For example, our maids carry a secret stash of pubic hairs...

american airlines, sabre and a box of LPs

In a small cupboard at the top of my house lies a hidden treasure trove of extraordinary worth. Before anyone decides to look me up for a quick break-in, the worth is not monetary but personal. And the treasure is not pirate gold (though some is definitely pirated) but plastic. Vinyl LPs. About 500 hundred of them, lovingly kept, filed in alphabetical order. Over the past few years I've observed with wry satisfaction as this ancient but wonderful format has started appearing once again on the shelves of music stores, the medium of choice for young musicians seeking a warm authentic sound.

I mention this only because if old farts like me wait long enough, everything comes round again - fashion, music, travel systems....yes, I did write 'travel systems'. The ongoing dispute between American Airlines and Sabre (and Expedia and Orbitz, and...and...) may be new news but the underlying arguments are as old as my LPs. The latest falling-out is based on the first principles of distribution: 1)control your channels and 2)drive down cost. American wants to sell its seats and services 'direct to market' in its own unique, revenue-enhancing way; optimal presentation of the product and packaged ancillary services, all without the inconvenience of paying Sabre and its (in their minds) greedy GDS & OTA brothers a hefty fee for a decidedly sub-optimal presentation. On the other hand, GDSs & OTAs argue that not having the ability to present a full range of options to the consumer in a standard format will only lead to frustration and lost business.

So what to do? Well, I have an idea. Let's develop a technology that enables users to book travel by using a single portal into multiple supplier systems. I even have a name for it - a multi-access system. We could call it...errr... Travicom. Or SMART or START or DMars. If those names mean nothing to you then you'll just have to imagine that there really was a world before GDSs. A world where the travel community used dumb terminals to access the databases of airlines, hotel groups and car rental companies.

Are we returning to a new form of the old world? Much will depend on whether the GDSs get their act together and provide a platform that meets the changing demands of suppliers...at an acceptable cost. If they don't...well, you know what they say, 'what goes around comes around'... and that's on the record.

selling sales

Why are hotel sales teams so unsuccessful at selling their IT needs in to their own organizations? I've come across a seriously scarey number of hotel groups where sales people are still managing their daily activites, contacts and reporting via Excel and emails. And before someone says, 'why aren't they using the PMS?', that may be a reasonable solution at property level but it frequently leaves regional, national and international sales managers out in the cold. Which means that the team as a whole is not connected.

Part of the problem stems from a faulty but stubborn equation that's been embedded in the collective psyche of our industry for far too long: Technology = Operations. PMS? CRS? CIS? Pick whichever TLA you like, but the reality is that systems designed to manage the hotel operation (or the finance of course) attract all the attention and all the investment. The Sales team is left to scratch around 'making do' with either a bolt-on front end to the operating system or a stand-alone generic salesforce application that was designed to sell....well, just about anything but hotel rooms.

If a VP Sales is brave enough to embark on the road to a proper sales solution, watch how quickly the combined forces of IT, Operations and Finance hijack the show and turn a simple need - 'I'd like to create a more effective sales organization please' - into an enterprise-wide technology gorge-fest. The end result (should there be one at all) is a system that can calculate the VAT on a Venezuelan tour group but leaves our long-forgotten VP Sales wondering if regional sales bothered to call on IBM last week.

Call me old-fashioned, but is not sales the lifeblood of any hotel group? Yes it is. So give the team the tools to do the job!

tripadvisor will eat itself

The phrase 'victim of its own success' has surely never been so true as in the current fiasco surrounding TripAdvisor. Well,'victim' may not be quite the right word...just yet. It would be hard to class them as victims when they've just announced an astonishing 44% increase in quarterly revenue vs Q3 last year to $139m. Parent Expedia claims that the site is the first ever travel brand to reach 40m unique monthly visitors in a single month. Impressive. Except that the gentle winds of mutual discontent that for a long time have been ruffling the feathers of hotel proprietors on the one hand and TA & their users on the other, is developing into a full-blown hurricane.

Hotels for their part are claiming that what was once an occasional fake bad review from a disaffected employee or scurrilous neighbouring property is now turning into a series of highly coordinated campaigns of deliberate sabotage and an increasingly common expression of competitive activity. Reputation Management company, Kwikchex, has declared war on behalf of the industry and is reckoned to have 800 hotels and restaurants lined up ready to 'name and shame' the fake reviewers. Far from taking this threat on the chin, TA has struck out with equal measure, claiming that fake positive reviews, penned by hotel staff, family and friends (not to mention the likes of Kwikchex and their ilk) are deliberately misleading customers with glowing reports of 'attentive staff' and 'dinners to die for'.

One glorious example of such sharp practice has just been uncovered in rural Ireland. According to the Belfast Telegraph, the following email from an un-named manager at the Clare Inn was sent to his staff:

"We have come up with a plan for everyone on this email only to post a review about their stay at the Clare Inn," the email read. "You must do this from your HOME PC or internet cafe, do not use a Lynch PC or the IP address will be picked up. I'd rather you didn't discuss this with your team. This is not something we would normally endorse but the reviews of the Clare Inn at the moment leave us with no choice.Please do not use hotel language or else our plan will backfire."

..and of course it has backfired now that the story is all over the free world. TA is responding to these shenanigans by posting red warning labels on the profiles of hotels thought to be guilty of bigging themselves up. The battle lines are drawn.

All of this of course is an inevitable consequence of the enormous influence that TA now has in the hotel bookings market. When a hotel business can succeed or fail on the basis of TA reviews is it any surprise that reputations can be bought and sold like an eBay auction? Quite where this leaves the poor consumer is at this stage unclear.Stripping out the fake good reviews and the fake bad reviews from the genuine articles is becoming as hazardous as choosing a hotel in the pre TA era. But such is the wonder of the web that no doubt as TA and its detractors wrestle themselves to the floor another player will emerge from the wings as the real, authentic, unadulterated, neutral, trustworthy hotel review site... who's your money on?

holes

Cast your eye across the British cultural landscape at the moment and you'll find one dominant theme - holes. They're everywhere. There are holes in the road. Quite a lot of them actually.. around 1.5 million, which is 50% up on last year in the aftermath of a Siberian Winter. The government is so concerned about the potential impact (literally) on the electorate that they've announced a £100m pay out to help councils fill them up again. Of course, that's £100m they don't really have because there's another big hole in the public finances. This debt hole is heading rapidly toward £1.6 trillion and means that next year British taxpayers will spend more on debt interest than on Defence.

And then there's the Lenny Henry hole. For those unfamiliar with Lenny, he's a Brit comedian who also happens to be the face of Premier Inns. The latest Premier ad campaign involves Lenny smashing a hole in a hotel room door with an axe, a la Jack Nicholson in The Shining, sticking his head through and shouting 'Here's Lenny'. This parody supposedly demonstrates the ill-effects of sleep deprivation caused by a bad night in a lousy hotel. Unfortunately for Premier, it's also demonstrated the ill-effects of broadcasting an axe-wielding Lenny Henry on daytime TV. Terror-stricken young children have reportedly been sent running and screaming for Mummy, leading the Advertising Standards Authority to ban poor Lenny from all children's programming.

I have some sympathy with Premier.. and Lenny. Let's face it, we've all had moments when we've wanted to smash a hole in a hotel door. Typically it's the door of the room next to us when 'nocturnal sounds' of one sort or another inhibit the serious business of falling asleep. Maybe Premier should consider a sequel with Lenny as the Terminator crashing through the walls from one room to another, ruthlessly taking out anyone shouting, moaning or talking on the phone too loudly, or with the TV on full volume at three in the morning. I'd buy into that. And with that kind of message Premier would soon monopolise the business traveller market. But I guess that's a hole other story...

lessons from a small plant

Forgive me, but I'm coming over all Wordsworthian. Looking out from my office I see a blanket of white snow and ice covering the lawn and flower beds. But thrusting forth from the frozen ground is a flash of green...it's a daffodil! OK, it's not at the 'fluttering and dancing in the breeze' phase, but still - a daffodil in December?

Now if this was a half decent blog I'd write some heart warming stuff about green shoots of spring in the depths of Winter being a metaphor for early signs of life appearing in the barren wastelands of the hotel industry. But I have a hunch that the next overnight frost will kill the daffodil stone dead (not to mention the metaphor). No, the lesson I would prefer to draw from this touching floral phenomenon is the importance of resilience. We press on, not because of some fantasy that Spring will arrive tomorrow, but because that's what we're wired to do. And because we know that even if business does not come bounding back in January, it will eventually as surely as Spring follows Winter.

May we all have a happy and peaceful Christmas and New Year...and a firm hope for 2010 born of resilience.

Here endeth the first lesson...

expedient expedia

I've been following the Choice/ Expedia dispute with some interest. Should we applaud Choice's CEO, Steve Joyce, for taking a courageous stance against loss of control of his hotels' rates and inventory? Or sympathise with the laudably pragmatic views of one Choice franchisee who is quoted as saying "I am an independent business person who will likely not survive this loss in sales I will experience while the big boys are having a pissing contest." Well, maybe we have to do both. No one wants to lose business, but then again no hotel should have to accept business at any price. The short term loss of being withdrawn from the site is going to hurt, but the longer-term damage of accepting adverse terms would be even greater.

In a past life I've been through this scenario myself with Expedia. They play hard ball in hard times because they can... and generally they do deliver. But if one supplier has complete control over your sell price down to last room, then where do you find rate parity? In a handbasket, on its way to hell.

The word Expedia is invented but obviously has its roots in 'expedient'. The OED defines expedient as 'convenient and practical although possibly improper or immoral'. That's one Branding company that really fulfilled the brief....

what's in a name?

I see that Hilton has announced a 'new' name...it's... errr....Hilton. I wonder how many late-into-the-night-sessions-with-Corp-ID-consultants it took before they came up with the 'Worldwide' suffix? To be fair, I suppose with one of the most recognised brands in the world (hotels or otherwise) there's only so many variations you can consider without compromising on brand values. (And I do like the new logo, even if it does look like a novel way of arranging a twin-bedded room).

When Utell and Anasazi merged to form REZsolutions back in '98, a journalist asked Anasazi founder Tom Castleberry how long it had taken to come up with the new name."Not long enough" was his succinct response. I'm tempted to offer the same reply when it comes to Nexus. I come across people all the time who think they've heard of us when in fact they have in mind an entirely different Nexus. Us Nexus's offer the world everything from business information to medical services, building alarms and, of course, hotel sales management systems.

This week I added another one to the list. A client sent us an important document via UPS, but unfortunately they addressed it wrongly. Rather than checking back with the client as to the correct address, UPS in its infinite wisdom decided to google an alternative Nexus location (at least I assume this was their methodology based on the outcome). It took a few days to finally ascertain that the document had been delivered to a Docklands-based company called Nexus Range. Of course I went to the website to look for a contact number and - wow - what an interesting organization! I like to think that our own product portfolio is exciting and appealing but I have to concede that the Nexus Range leaves us in a distant second place. I would blush to tell you more so if you're curious do your own UPS-style googling. I can't see any obvious marketing tie-ins between our two Nexus's, but I might just nick their tag line...

Nexus - guaranteed to hit the spot for everyone

berlin spring

For many folk in the hotel community, Berlin has only 4 reference points: An airport (Tegel, home of the most officious security people in Europe. I don't count Schoenefeld as it's halfway to Dresden); an exhibition centre (Messe Berlin, home of ITB); a hotel (could be any - you only spend 3 hours a night there anyway) and a bar (Marlene's). Berlin has only one temperature: bloody freezing (ref ITB, March). This was certainly my experience until about a year ago. That's when Nexus held its first EMEA client forum in Berlin. In May. What a revelation! Stripped of its winter gloom, the German capital really comes to life - from the many bars along the newly developed riverfront to the wonderful Tiergarten the city is a really pleasant place to hang out. And freed from the restrictive social demands of the trade show, there's time to explore some of the more out-of-the-way locations. Last year we took an evening trip along the river, this year we were down in the bunkers below the city. And my insider tip for a good night out - Clarchen's Ballhaus. Take your Tango shoes...

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