SOFTWARE FROM AN AUSTRALIAN-BASED COMPANY IS HELPING HOTELS AROUND THE WORLD COPE WITH THE PROLIFERATION OF ONLINE BOOKING SITES.
With multiple websites hawking the same hotel rooms, the danger of double bookings has always been a headache. Not anymore.
ONLINE TRAVEL AGENTS
can help hotels of all sizes reach a global audience, but they can also deliver a world of confusion. With multiple websites hawking the same hotel rooms, there is always the danger of double bookings. And keeping every distributor abreast of ever-changing rates and inventory can quickly become a major headache.
Mike Ford, a South African IT professional who moved to Australia 12 years ago, became aware of the problems facing hoteliers after he invested in a backpacker business in the mid-2000s. At the time, he was running a team for medical billing company ICS Global, developing a switch to allow hospitals and private medical funds to transfer claims electronically. But he saw the opportunity to apply his expertise to the travel industry.
In 2006, Ford and ICS Global colleague Mike Rogers resigned and launched Site Minder, a software product that allows hotels to enter rates and rooms once on a single platform and then distribute them to multiple websites. As soon as reservations come in, Site Minder automatically updates the inventory across all channels. It also captures bookings in the hotels’ property management systems, eliminating what was previously a slow, costly and sometimes inaccurate manual process.
The company quickly dominated the Australasian market before turning its attention to Asia and Europe. It now works with more than 9000 properties in 150 countries, and employs 167 staff across offices in Sydney, Bangkok, Cape Town and London. “We view ourselves as one of the top four providers globally in this space, and we probably havemore hotels by number than any of our competitors,” Ford says.
Establishing a physical presence in target markets has been vital to the company’s development. “Hoteliers are very conservative in their adoption of technology. They don’t want to be the guy who made a mistake by trying to go for something new and better. That means getting recognition is tough because people view you as this little company fromAustralia. It’s too hard and too far away for them to have that trust that it’s great technology.
“We overcame that by saying: OK, we’ll set up where you are, andmake the brand a local brand. We literally plonked an office in London and moved a couple of people over, and that was the start to our success in Europe.”
Site Minder’s aggressive growth was initially facilitated by small angel investors. Then in 2012 it received $5.6 million from Bailador Investment Management, established in 2010 by former Fairfax Media chief executive David Kirk and private equity investor Paul Wilson.
The company is using the funds to rapidly enlarge its European footprint and to launch into the US market, where in June it opened a satellite office in Dallas. “In the US, I don’t think channel management is widespread at all, partly because there were only four main [online] players. But now they have new distribution sites such as agoda.com and kayak.com,
HOTELIERS ARE VERY CONSERVATIVE IN THEIR ADOPTION OF TECHNOLOGY.
as well as Ctrip.com in China and Rakuten Travel in Japan. If American hotels want that business, they need to list on those sites. It’s becoming a global game very quickly, so I think the acceleration and adoption of distribution technologies will be supercharged in the next three years.”
Site Minder’s product suite is also evolving. In mid-2012, it launched the Room Distribution Exchange, which essentially enables property management system providers to bolt channel distribution on to their branded products, backed by existing customer support services.
“So customers don’t know directly about Site Minder. They only know that they now have distribution that they can manage themselves. It’s an out-of-the-box, plug-and-play channel management solution for a property management vendor to call their own.”
The real benefit of RDX, he says, is that it allows Site Minder to scale much faster than if it were trying to sell directly to every hotel.
The company has also developed an “all-in-one” solution that allows small properties to manage their rooms and distribute them to travel sites at an economical price. And it is helping hotels list rates directly on emerging channels such as Google Hotel Finder and previously inaccessible booking sites in China and Japan.
“We want our customers to be able to reach people anywhere. As soon as we are connected to Ctrip.com, we will have our hotels selling their inventory directly to Chinese travellers.”