Reservation Systems
Single image inventory provides unforeseen benefits.
By Rebecca Oliva, Associate Editor -- Hotels, 6/30/2004 11:00:00 PM
When Madrid-based NH Hoteles implemented TRUST International’s Voyager 4.0 central reservation system (CRS), it realized a 30% labor savings. The single-image inventory system far surpassed the abilities of its older CRS and includes features such as business intelligence and rate transmission. “Voyager CRS helps us to distribute our inventory in a more efficient and economic fashion,” says Gonzalo Alcaraz, corporate sales officer, NH Hoteles. “We have access to all new functions of the Voyager CRS, and our operations department has both direct and intermediate access to all distribution channels, which makes for better operations.”
Similar to property management systems (PMSs), many CRS vendors now offer total enterprise solutions that interface with other technology systems such as revenue management and customer relationship management. Aside from the multiple benefits these single-image inventory CRSs afford with rate management, many hotels have discovered further advantages. Primarily, systems such as Voyager 4.0 offer hotels greater access to their guest databases—both at the corporate and property levels. As a result, hotels are creating detailed guest histories via their CRSs.
While these improvements are the first steps toward reaching a completely seamless CRS, their benefits can make a world of difference.
Managing Rate Integrity
In hopes of improving rate integrity, Shangri-La Hotels and Resorts, Hong Kong, recently launched MICROS-Fidelio’s OPERA Central Reservations and Customer Information Systems with a total investment of more than US$3 million. “The Opera CRS is completely integrated with the Opera PMS that Shangri-La is rolling out,” says Anand Rao, chief information officer, Shangri-La Hotels and Resorts. “This gives unparalleled access to the PMS information at the CRS level, including all rates and up-to-the-moment availability. We can therefore ensure rate integrity throughout the system for all modes of booking—hotel-direct, through call centers, through the Web and through the GDS.” The Web booking interface will be rolled out in September followed by the GDS.
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| CRSs such as TRUST Voyager 4.0 offer hotels greater access to their guest databases—both at the corporate and property levels. |
The OPERA reservation system is an integrated, enterprise inventory system and is unified with the PMS and sales and catering. “The new systems offer single-image inventory, based on real-time synchronization of transactional and profile data between the hotel and central systems,” Rao says. The benefit of this, Rao asserts, is the system supports rate integrity and last room availability across distribution channels, including Shangri-La’s hotel direct reservations, toll-free numbers and the Web site. Within the next six months, Shangri-La’s Web site and various other third-party booking engines will be interfaced to the central systems via an XML messaging platform.
The implementation of both systems is a vast change from the Merlin reservation system the hotel chain used to operate, co-developed by MICROS and Shangri-La. Now, Rao says, the CRS works better with Shangri-La’s environment.
Shangri-La also set up a team of staff from reservations, rooms, IT and finance departments to thoroughly test the system and standardize it for its operations. “This was very crucial for the success of the project,” Rao says. “The software is completely double byte-enabled—this is a must for a system to work in our environment where we handle Chinese character sets for names and addresses.”
Consolidating Database Management
An added bonus for many of these highly integrated CRSs is the accurate and extensive database management capabilities. The systems’ single-image inventory allows the software to work faster, therefore enabling reservations staff at the call centers to grab customer information quickly while they are still on the call.
For NH Hoteles, the most beneficial enhancements come in the form of guest database management. “We have noticed a difference in database management as far as maintaining hotel property information on the system,” says Cecilia Svane, electronic distribution manager. “Within the new version there are several things that help us save time.”
Voyager’s new business intelligence module, called Voyager View, includes a narrowcast server that can deliver predefined reports, pivot tables and data cubes to a list of recipients on a predetermined schedule—cutting out much of the middleman work, Svane says. NH Hoteles uses these features to ensure that all the appropriate staff receives the right reports on time. The system also offers a direct interface with IDeaS revenue management system, which allows more control of rates and availability in all distribution channels without manual intervention. NH Hoteles currently does not utilize this feature, but Svane says the potential is there.
The Spanish hotel chain also takes advantage of the direct interface with the XML-based property management system (PMS) that can support reservation and rate downloads and uploads, and profile and availability uploads.
With the expansion of Shangri-La, these new systems ensure even higher levels of guest recognition and customer service through the sharing of individual preferences and special requests at all 42 properties. Members of the Golden Circle, the guest recognition program, soon will be able to manage their account through the Web site.
The CIS collects and manages guest, travel agent, source, group and company profile information from designated properties into a single central database. Guest stays with detailed revenue information are collected, and profiles are kept up-to-date with a specialized subscription module. Shangri-La can configure the system to track information by its own set of criteria. Rate also can be created centrally and distributed to designated properties.
“This also enables us to take our recognition-based guest loyalty program, Golden Circle, to the next level of individually focused enhanced service levels,” Rao says. “Guests’ likes, dislikes, preferences and stay experiences are available across the group to the employers to render exceptional levels of service.”
HOTELS Asks...
Q: What steps have you taken to reduce the cost of reservations?
Jimmy Suh, vice president, revenue management and distribution, Kimpton Group, San Francisco:
A: I think the most obvious way we reduce the cost is with our own online distribution—our Web sites. We have directed a lot more traffic to our Web sites by bypassing the global distribution services (GDSs) and the central reservation office (CRO).
We also are pursuing more contracts that have preferred negotiated rates with various companies booking direct, and we are in the process of having wholesalers—domestic and international— book direct as opposed to faxing. We also outsource our central reservations systems (CRSs) to an office in Canada, which has substantially lowered our costs of central reservations.
Even though the net merchant models have increased the cost of distribution, we have been able to negotiate lower discount margins successfully. In addition, with our distribution solutions partner, we have obtained a direct connection with our central reservations systems, thus having only a couple of partners with whom we deal with in an extranet environment.
We also are using our Web site to launch our own product to generate incremental revenue from distressed inventory. By doing this, we are incorporating the Internet consumer segment who is more price sensitive, possibly a bit more flexible with rates and is willing to commit further out.
Patricia Brusha, director of revenue distribution management, New Castle Hotels, Shelton, Connecticut:
A: 2004 is the year to be concerned about the independent hotels. For the brands, the margins they have negotiated with the intermediary travel sites are much more reasonable than they used to be. Independents still are paying a premium with restrictions on rate and inventory that make selling rooms through e-channels cost prohibitive. The most cost-efficient source of a reservation is through the booking engines on their Web sites and by participating in search engine optimization and pay-per-click programs.
I am currently reviewing new booking engines that are more consumer-oriented with revenue management components and enhanced reporting and marketing capabilities. The strategy for independents has to be Web-based with a balanced combination of turning lookers into bookers; being easily found in searches; and changing demand patterns with pay-per-click ads.
For the brands it is a different story, if you want to reduce the cost of reservations, drive repeat business to book through your hotel. You have to look at the basic selling skills that should be on your Web site: CRM, product positioning, good value, knowing your competition and exceptional service. I still believe people buy from people.
The other component is if we look at it on the flipside with best rate guarantees and single-image inventory. Many of the costs of a reservation through direct portals are fixed, and so the opportunity is not just to reduce costs, but to maximize revenue through up-selling opportunities. If your Best Available Rate is the same across all distribution channels you can capitalize on your up-sell opportunities through packaging components.
We are looking at some industry benchmarking statistics to be sure we are capturing the most reservations at a competitive price. There are various areas of distribution that you realize reservations from, and you do need to measure what those costs are and concentrate your efforts on moving reservations toward your cheapest source.
Q: How well is your staff coping with merchant model extranets, and have you found any way to automate that process?
Chris Heinz, senior vice president of distribution and revenue management, Wyndham International, Dallas:
A: Working with non-automated merchant models is a lot of work, but they contribute a great deal of business to Wyndham. There are really only two third-party merchant model companies that we work with that are not connected through some other electronic source, Hotels.com and Expedia.com.
As far as finding a way to automate the process, we are taking steps to create a direct connection between our CRS and their booking engines. This process requires a major CRS upgrade, which we intend to have completed by August 2004. Shortly thereafter, we will begin development of an XML interface to these important travel partners. The best-case scenario would have us connected by first quarter of 2005.
There is an efficiency that we will garner from the interface. It will save each hotel at least a couple of hours per week whereby the directors of revenue management can reallocate their time to producing other revenue strategies for Wyndham. The real win in this for Wyndham, the third-party Web sites and especially our mutual customers, is that we will be merchandising rates and availability that are updated in real-time, making it easier for customers to do business with us.
Lisa Shields, E-distribution channel manager, Jurys Doyle Hotel Group, Dublin:
A: This is certainly an issue with which we grapple. The first thing that we try to do is prioritize by asking ourselves if it will pull in more business to justify the work. We try to work with Web sites that have a direct interface to our Web site so staff only has to maintain our site.
For the most part, we manage the extranets in our central reservations office in order to keep control of these systems. This way all extranets are updated at the same time to avoid rate differences. Also, as we have a team of Extranet experts there who save time so we can free up our staff at the local level to get on with the business of managing their hotels. Having the extranets centrally controlled is certainly more efficient, and it helps for training purposes as well.
In the longer term, we are keen to investigate direct connect modules for our key partners. We are currently looking into purchasing a CRS system and one of the key criteria is if they can hook up with other systems and Web sites. We are looking at how advanced they are with direct connect Web sites. Until then, dealing with extranets is a necessary evil. We have to deal with it and have to put some resources into it. However, we are looking at long-term measures.
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