Hotel revenue management technology supplier Duetto is
devising methods to aid hotel clients in corporate rate negotiations by arming
them with forward-looking data.
Launched in 2012, Duetto now has more than 100 hotels live
in its system with the average revenue growth in the 10 percent to 20 percent
range. CEO Patrick Bosworth said the company plans to have tools specific to
corporate rate negotiations in place by the time request-for-proposal season
rolls around later this year. Duetto already has built long-term forecasts
using hotel industry data along with relevant external data, including airline
data, he said.
"We're forecasting a lot of different types of metrics
for hotels going more than a year into the future," Bosworth said. "Now
that we have that live and tested in the app, we can do interesting things to
help group sales, corporate contract negotiations and wholesaler negotiations."
Speaking at the Duetto-hosted Revenue Strategy Summit in New
York in November, Susquehanna International Group senior lodging analyst
Rachael Rothman noted that corporate negotiated rate projections made by
lodging executives in the months leading up to RFP season often are based on
historical data and often are off the mark.
"There are generalizations about corporate rate
negotiations, but you never really know what the number is," Rothman said.
"Wouldn't it be great if there was a [Smith Travel Research report] that
looked forward and not just tell you what happened yesterday?"
Duetto currently is negotiating deals to integrate data for
hotels to benchmark specifically within the managed travel segment: data
showing where managed travelers from certain business sectors are booking, for
example. With that, hotels could determine whether they were getting the
optimum market share from their target segments.
"If the answer is no, they can figure out how to
present the property in a different way: make the pricing appropriate,
renegotiate some rates and figure out how to make the pricing on them more
dynamic," Bosworth said. "Some of our customers are doing interesting
things, contracting with a fixed price in certain room categories but then
having other room categories be yieldable, so we can unlock those strategies so
they get the volume of business they want but also make money from companies
that have a very high demand for their hotel."
Bosworth listed Concur as one potential data source, saying
it "hasn't been monetizing its data for the most part."
Duetto already can break out data relative to corporate rate
codes. Hotels can see not only how often bookings were made with rate codes but
also how many queries were made using the rate code even if it did not result
in an actual booking.
Bosworth said delving deeper into international markets is a
goal this year. Duetto currently is live in 19 countries and is growing rapidly
in Europe and Asia, although the company does not yet have teams on the ground
outside of the United States.
"Each of those different regions is similar enough to
be able to use the core product, but they also have some interesting quirks,"
he said. "We'll be diving deeper into those markets to find out what the
differences are. In China, for example, 60 percent of all booking are through
Ctrip, so it's figuring out how to help that market differentiate a
business-focused product."