Asian Hotels & Catering Times

April 2005

With Reservation - p. 26-28

James Moore looks at the new wave of reservation systems on the market.

As we discovered last month when we talked about revenue management, even with all the dazzling new hospitality solutions on the market, unless you have a capable user, the potential of these products will never be realized. A hotels chain based in the US recently came out and admitted that its guests used only around 20 per cent of the total technology available to them with its hotels. Well, the same applies to products that are aimed at a hotel’s staff because of user-unfriendliness or lack of decent training. Equally, not all products fit (or were designed for) all hotels.

Luckily, a genuine trend for IT solutions right now – reservation systems, in particular, where the guest (or representative) and the hotel both interface with the system – is for providers to make them as user-friendly as possible. With guests or travel agents booking through a website or booking engine, this is extremely important to say the least. A member of hotel staff can be trained to operate a system; a paying guest won’t think twice about opting for another hotel if you can’t work the damn thing or get instant confirmation of rate and availability.

In many cases, customers use the internet as a primary guide to a hotel’s price. By making it attractive and easy to use, it will only increase the likelihood that curiosity will turn into a booking – still the internet’s biggest challenge, especially in Asia.

“The internet is the most obvious and pressing issue with regard to all hospitality businesses worldwide and cannot be underestimated.” Says Peter Shearn., Managing Director of CaterActive. “When we started our company four years ago, the net was clearly becoming more important and redesigned our systems accordingly. However, we have found that the speed of change with regard to tourists arranging hotels via the internet has been almost exponential. The most common figure heard now regarding inter-related booking is 70 per cent and this will certainly rise further.”

CaterActive is a UK-based company that produces the hospitality system, CaterBook. This system prides itself on its ease of use and is targeted at small hotels with 50 rooms or less. The online systems are currently being redesigned for CaterBook and Shearn expects that they will have to modify these regularly in the future in order to embrace new technologies as they appear.

Systems upgrade

What should come as good news to hotels is that major players in the industry, including Cendant Hospitality Solutions, are leading an industry-wide effort through an organization called HTNG (Hospitality Technology Next Generation). According to Cendant, the organization hopes to develop a standard set of interfaces for the many disparate hotel systems and platforms that will enable them to simply ‘plug and play’ without the challenge of requiring multiple specifications between every platform in the communication process.

With such shifts in the nature of the industry possible, it makes preparation exceedingly difficult. “We are redesigning our own systems after only three years and we expect this will have to be updated again in an even shorter time,” says Shearn. So what can be done to not only make sure adequate provision has been made for the future, but also to purge the industry of middlemen that deprive hotels of large, and on the whole, unnecessary commissions? “In our opinion, a system which uses both a hotel-based computer and an internet-connected database is the most secure. This will place the online booking process back into the hands of the hotelier and allow them more control as well as removing the middlemen.

Universal rate

Another method of achieving this is by assuring that a hotel’s rate is ‘official’ and ‘live’. No matter whether you book through a travel agent via GDS, a third-party site or the hotel’s own website, there is only one rate. If a wholesaler or middleman tries to make additional commission by selling a room at a higher rate, or doesn’t stick to the terms and conditions that apply to that figure, the hotel should have the authority and convictions to blacklist them. This is happening for smaller hotels.

Returning to the technology behind a Central Reservation System (CRS), there are variations in what companies offer. “Difference comes in the ease of use (staff re-training should be minimal), the quality of the reporting and suitability to the nature of the hotel,” continues Shearn. “The most dramatic implementation is the entire online system which for my money is the most risky. A hotel can become totally dependant on the booking system it uses and it is perfectly possible, if not probable that the internet line can go down and you can bet it happens at the busiest checkout time!”

Systems are of course also targeted at larger hotels and even chains. Trust International, a subsidiary of Cendant Corporation and a provider of a comprehensive range of technology and distribution solutions for the hospitality industry, has actually acquired a number of major travel distribution services to make sure it has unrivalled integration. Orbitz and ebooker are just two recent acquisitions and more information about the deals and Cendant can be found on the company’s website, hospitality.cendant.com.

“Hotel chains are increasingly looking to have greater control over the distribution of their rates and room allotments, to help them manage their yields over multiple distribution channels, both online and offline. [Our most recent connectivity product] Jumpstart Web Services is one solution to help hotels accomplish this,” claims Trust’s Anthony Ku.

Whilst Ku acknowledges that the growth of the internet has brought a huge increase in online travel distribution, offline distribution is still the largest source of travel bookings in Asia-Pacific. He cites research from PhocusWright that expects offline travel to account for US$140 billion by 2010, compared to the expected online travel figure of US$60 billion by 2010. With this in mind, Ku claims that Cendant is set to: “Provide distribution solutions in each category in the Asia market to meet demand through all these channels, including Galileo, HotelClub.com, RatesToGo.com, Asia-hotels.com and the recently launched AoYou.com in China. In addition, our Voyager CRS technology provides an online booking tool to enable hotel reservations on their own Web sites.”

Constant evolution

The advantages of Cendant are that is constantly investing in its hotel reservation and distribution technologies to provide state-of-the-art solutions including CRS, connectivity and rate/data management solutions and a full range of online and offline distribution channels with marketing tools to drive more business to its many hotel clients that include Mandarin Oriental, Oberoi, New Otani, and Raffles. “This represents a full-service, end-to-end solution to serve a hotel group’s reservation and distribution needs,” says Ku. The system also operates Neat Dynamic Packaging, a technology that allows online distribution channels and travel agents to build unique combinations of air, hotel and car packages to meet specific customer needs.

Of course, not all hotels rely on outside providers. Before many of them had even heard of reservations’ system, Marriott had invested heavily in one. MARSHA handles 50-something percent of all bookings with over US$4 billion in revenue; no wonder it’s made for Marriott and Marriott only, it doesn’t have to be altered in any way. In theory, none of its applications are redundant and re-training isn’t an issue.

Quite simply, MARSHA’s objective is: “To highlight the revenue and efficiency advantages of installing a two-way interface between the hotel PMS and Marriott’s reservation system.” Historical results indicate a five to 10 percent RevPAR gain after two-way installation. Who would argue with that?

Check yourself

More than 1,000 business travelers were recently surveyed for the recent Business Travel Show London to find out what made the essential mix for creating the perfect business trip in 2005. A stunning 75 percent agreed that the introduction of online booking and e-tickets have been the most significant developments in business travel over the last three years. Although they also welcomed a friendly face either at check-in, it was hassle-free efficiency that is seen as the overriding factor in the study.

Replacing the smile with a humorless, but proficient machine in the form of a self-service check-in is becoming increasingly common. Whether you are checking in to board a flight or to check-in to a room at a hotel, long queues and unnecessary small talk can now be avoided. Both Embassy Hotel Suites and Hyatt Hotels Corporation have recently come out and said that they are installing kiosks in their hotel lobbies during 2005, with Embassy claiming that all of its hotels will have them by next year.

Hyatt’s self-service kiosks are tied into the company’s reservation system. Much like the airport kiosks that travelers have become accustomed to, the kiosks read information on a credit card that a guest swipes to begin both check-in and check-out. Once the system recognizes the name and reservation, upon check-in guests can receive their room key, enter their frequent stay Hyatt Gold Passport number and request an upgrade or room change.

While checking out the kiosk gives guests the ability to pay, print out a complete receipt, and receive a folio of their stay, “ In most cases, Hyatt guests can complete their check-in/checkout transactions in under a minute,” claims Tracy Flynn, Vice – President of hospitality solutions at NCR, the technology company that supplies the kiosk.