Photo by Andrew Werner
HotelPlanner.com CEO Tim Hentschel has been called a lot of things; innovator, disruptor, trailblazer. He believes it’s to be expected when changing one of the largest and oldest industries in the world. The tourism industry is responsible for 10% of our global GDP, and Hentschel has spent the last 15 years of his life trying to make the most difficult and time-consuming sector of the tourism industry, “group travel,” more transparent and customer friendly by leveraging new technology.
This year, $560 billion will be spent in hotels worldwide, and 1 out of every 3 of those hotel rooms is booked around a group event, whether something small and personal like a wedding, or a much larger event, like the Super Bowl or the Olympics. Along with a team of engineers and highly experienced local planners at HotelPlanner.com and Meetings.com, Hentschel is trying to solve the complex issues around both small and large group markets. He believes his company is in a unique position to accomplish these lofty goals using Big Data.
The platform that Hentschel and his business partner John Prince founded in 2003 will process over one million groups this year, with over $7 billion in hotel revenue passing through their group booking system. Their system has reached some other impressive milestones recently; of the half-billion hotel room nights processed through the company to date, more than 15% of the room nights sold this year will be completely automated through their new instant group rate system.
We asked him why Big Data was so important in making group travel easier, and he said it was the only way to accurately predict and guarantee the best future group hotel rates.
“We have more data on events than anyone else, as well as more connections to hotels on a property and global centralized reservation systems level,” Hentschel explained. “We see all room types and current and forecasted occupancy levels, plus forecasts on all events coming to the city over a customer’s dates of stay. This allows us to get the best rates, booking policies, and room types for our customers.”
Hentschel admits that when first built, the system was not always able to consistently and accurately predict future rates; now, he says, the company’s new generation of group booking tools can bring accuracy percentages into the high 90s using a number of different data system connections and high group booking volumes through their platform. Their instant group booking system is talking to over 30 different system in real-time right now, while also checking a database of over 10,000 large events, from conferences and concerts to large sporting events and festivals. When information on large city-wide events is combined with their millions of group rate searches, the system can start to predict trends of group booking demand against individual travel rates. The ultimate goal is to guarantee their customers a better group booking rate than what anyone can book as an individual.
“What we’ve done is create the perfect hybrid of human and machine, so we can provide the perfect online event planning and booking service,” Hentschel says.
There are more benefits for customers in securing the best possible group rates. Over the past ten years, the group booking industry has seen the number of rooms reserved under a “group block” drop from seven in ten rooms to just three in seven, due to increased competition for last-minute deals. Additionally, hotels have begun adding what are often called “attrition clauses” to group contracts, which holds groups responsible for lost revenue if they fail to pick up all, or even most, of the rooms in their block.
Hentschel’s instant group rate system is the only system that can ensure low prices keep group bookings under the “group block” system, but also combats hotels’ deceptive practices of using attrition clauses by making HotelPlanner.com the ultimate holder of all group blocks. Hentschel says his team’s system represents the future of the group booking industry, judging by the amount of positive feedback he gets on a daily basis — not to mention the 1,000% year over year revenue growth they have seen from the new product.
“When we set out 15 years ago to build the robot that brings people together, these were the positive impacts we were hoping our technology could bring to the world,” Hentschel concludes.