AWARDS

What It Takes to Be a Hotel Visionary

Choice Hotels International and Loews Hotels & Co honored for outstanding achievement, vision and leadership in technological innovation.

By Michal Christine Escobar, Senior Editor - Hotels

Since 2005, Hospitality Technology has been honoring hotel companies for outstanding leadership in customer-facing and enterprise innovation. In 2021, we were especially impressed by Choice Hotels International and Loews Hotels & Co for their creation of two new technologies that served to significantly benefit either their owner operators or their hotel guests during a very uncertain time: the second year of the COVID-19 pandemic. We presented Choice Hotels and Loews Hotels with their awards at our annual HT-NEXT conference in December 2021. Here is an in-depth look at the winning innovations.

ENTERPRISE INNOVATOR: Choice Hotels International

As COVID-19 settled in for the long-term, one of the major effects it had on the hospitality industry was to completely disrupt booking curves and pricing. Historical data was no longer useful or accurate, and Choice Hotels recognized that their franchisees needed a new tool to better forecast and understand what a customer was willing to pay.

“Currently, 80 percent of our overall business is booked within 72 hours,” notes Douglas Lisi, vice president of revenue management. “And in our economy hotels, 50 percent of our business is booked the same day.”

So, Choice Hotels decided in 2021 to launch its new revenue management system – ChoiceMAX – to help hoteliers optimize their pricing structure aimed at increasing revenue.

Prior to ChoiceMAX, franchisees were using two systems to manage their rates and inventory, Lisi explains. The first was SmartRates, a proprietary system from SaS based on their RMPOA all-purpose algorithm. That system managed the daily rate that was sent to ChoiceHotels.com, the OTAs and the call center and could only manage rates up to 90 days in advance. Hoteliers also used a product that was built in-house called Rate Center to manage their inventory up to 365 days in advance.

“Logging into two systems is a cumbersome way to manage a business,” Lisi explains.

While Smart Rates was allowing hoteliers to manage rates and maximize revenue, the brand was receiving quite a bit of feedback from franchisees that they wanted a revenue optimization tool that could focus on the next 365 days, especially for its Cambria and extended stay brands that have bookings well beyond 90 days and needed a longer-term view. At the same time, it was hearing from its economy and mid-scale brands that they wanted rate pricing to adjust more than just once per day.

New Collaboration, New Product

To solve these challenges, Choice Hotels collaborated with IDeaS, a provider of revenue management and software services, to create ChoiceMAX.

“While we, of course, know our franchisee base (economy, midscale and upper midscale) very well, IDeaS had limited experience in this area,” Lisi says. “And we needed their help with the revenue science. So, we worked together to use our knowledge and their science to create ChoiceMAX, a tool that was tailormade for our franchisees.”

Throughout its collaboration, Choice Hotels emphasized the need for their new system to be designed with three core components: automation, adaptation and highly advanced algorithms.

To begin with, ChoiceMAX leverages advanced pricing and inventory management algorithms as

well as machine learning throughout the day to understand how to recalibrate those algorithms based on competitor and consumer reactions to the proposed rates.

“It’s as intuitive as you can get,” Lisi notes. “What we really wanted to do for our franchisees was simplify the type and number of revenue management decisions they had to make to just a few core decisions. Meanwhile, the system is doing all the price elasticity calculations for them, so they don’t have to do any of that heavy work.”

In fact, it has an optimization window of 365 days and reviews competitor websites multiple times per day to ensure Choice Hotels’ rates are competitive, while also allowing franchisees to set real-time alerts that can be customized to stay up-to-date on price changes or when competitors make adjustments.

“It acts in real time and responds to the trends of each of our brands,” Lisi adds. “So, this really allows them to understand what the booking trends are within their own market and then optimize pricing throughout the day.”

This functionality is only possible because of the investment Choice Hotels made in ChoiceEDGE, its global reservation system, which debuted in 2018 (and won a 2019 Hotel Visionary Award). ChoiceEDGE allows for streaming data to happen continuously throughout the systems in the cloud, meaning there is no historical infrastructure that limits, for example, the number of messages the brand is able to send in and out to its different distribution partners.

“Historically, hotels have been limited by the number of times they can message their distribution partners per day,” Lisi explains. “But now, because of ChoiceEDGE, our 5,000 hotels can send four messages a day, 365 days a year, to our distribution partners. We never could have done that without the investment we made in ChoiceEDGE.”

Built to Last

Ensuring that the platform could quickly adapt, regardless of what world event might happen, was especially important to Choice Hotels.

“We spent a lot of time on this first phase of ChoiceMAX to ensure we had a really strong platform so that a massive rebuild in the future won’t be necessary,” Lisi explains. “We’ve made sure it has the flexibility with the APIs and integrations that we’re building to ensure we have the flexibility to be nimble in the marketplace and adapt to whatever our franchisees’ needs may be. And if we have different brands come in the future, with different customer sets, we can adapt the same system to those needs as well. Plus, with the rising demand for personalization, we now have the ability to layer in personalized segments into our algorithms and understand what the price elasticity is for different customer segments.”

Additionally, the company created ChoiceMAX to be a mobile-first, user-friendly platform. For instance, users can get real-time notifications on their phone. This is especially helpful as labor shortages continue to be a problem for the industry. So, if a hotelier is helping at the front desk, cleaning a room, or dealing with a guest complaint, she is still able to stay on top of booking patterns changing and respond to that immediately versus having to make time to sit at a desk and log into a system. “As far as I know, ChoiceMAX is the only revenue management system out there that is both mobile-first and mobile friendly,” Lisi says. “In today’s environment, franchisees need that capability.” An added benefit is its

increased automation and integration with choiceADVANTAGE, the company’s PMS, and ChoiceEDGE, the company’s CRS.

“The increased automation allows for seamless distribution of rates and inventory across not just the Choice platform, but also all of our distribution partners,” Lisi added.

Five-Star Reviews

Franchisees are loving it so far. “The feedback we’re getting from franchisees is just remarkable,” Lisi says. “They love how simple the tool is and tell us that it’s made their life so much easier during a time when stress levels are very high. It’s great to know that we’ve simplified their lives and made some of their pain points disappear.”

But don’t take Lisi’s word for it. The brand shared with us some recent reviews from their franchisees.

“Moving to ChoiceMAX has been a real game changer. Having the ChoiceMAX app right on my phone makes managing my rates and inventory so much easier. We have especially busy days at the hotel and are always being pulled in multiple directions. Being able to monitor pricing and what’s happening in my market without having to be at my desk helps save me valuable time and lets me focus on my team and our guests. Plus, the same-day optimization function means my data stays current and reacts quickly to local changes which is what we need in this demand environment.” - Pete Patel, Owner, Econo Lodge Goose Creek and President of the Econo Lodge Franchisee Association

“Cambria Hotel Pittsburgh Downtown was a pilot property for ChoiceMAX. From the moment we began training, we knew that the power of the system was not only cutting edge, but a technological advantage over our competition. Within our first week of reporting, we took notice of the strategy of the system and allowed it to run its course. We gave control to ChoiceMAX, monitoring it closely and setting alerts that we felt were relevant to our city. By far, the best advantage to this new system is the capability of the application. I never imagined being able to change rates and watching it reflect in seconds. I can change rates on my cell phone from virtually anywhere, keeping the laptop at home!” - Mario Corrado, General Manager, Cambria Hotel Pittsburgh Downtown.

CUSTOMER-FACING INNOVATOR:

LOEWS HOTELS & CO

Like other hotel brands, Loews Hotels & Co quickly converted its in-person experiences into contactless experiences wherever possible in response to the global COVID-19 pandemic. The brand wanted to ensure that guests felt safe, while also remembering the company’s brand positioning and service culture.

“When the pandemic began, we had questions – like everyone else did,” notes Barry Phillips, Senior Director IT Strategic Systems. “For example, how do we take care of our team members and guests and ensure they feel comfortable? What does contactless mean? How do we service our restaurants and bars without them coming to see us? And, how can guests bypass the front desk?”

Initially, Loews Hotels & Co – like so many others – turned to QR codes to provide contactless solutions.

However, when the brand realized that the pandemic would be a marathon and not a sprint, it revaluated its use of QR codes and the contactless experience. It ended up paring down its QR code offerings and then created a new

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“Essentially, the Loews team digitized and disconnected guests from a jagged and antiquated approach to information and are now delivering information on the guest’s terms at thoughtful intervals.”

BARRY PHILLIPS, SENIOR DIRECTOR

IT STRATEGIC SYSTEMS

solution that would include a variety of services while allowing guests to interact with the brand via a single point of contact: the guest portal.

For Loews Hotels & Co, it was particularly important to offer the guest portal to their customers via a variety of methods. The first way it is offered is via a welcome SMS message to guests who have checked-in and opted into the brand’s Chat Your Service program.

“This also opens up a channel for guests to engage our team throughout their entire stay with Loews and beyond,” adds Phillips. “It allows us to communicate directly with a guest via their own personal device. Plus, all texting is responded to by team members, which aligns with our brand positioning centered around human interactions.

And while the brand has significantly reduced the number of QR codes it manages, it found that having a QR code available to guests so that they can access the guest portal whenever they’d like was both efficient and useful. Thus, a QR code for each property’s specific guest portal is deployed via in-room collateral, on the TVs in guest rooms and on a stand at the front desk

Lastly, when guests logon to the property’s internet, the Wi-Fi landing page also delivers guests automatically to the guest portal.

The guest portal was designed to take the in-room compendium, in-room dining menu, outlet menus, arrival details, local attractions, and outlet reservations and put them on an easy-to-use portal that does not require a login. For example, guests can use the guest portal to access more than 40 outlets to order food and beverage options whether it’s for delivery, pickup or poolside delivery.

“Essentially, the Loews team digitized and disconnected guests from a jagged and antiquated approach to information and are now delivering information on the guest’s terms at thoughtful intervals,” Phillips explains. “For example, if a guest wants to make a dinner reservation, they can either text the on-site team members or click the guest portal and do it themselves.

Since implementation Loews Hotels & Co has found more than half of guests choose to opt-in to the service and make use of the guest portal. And food orders through the portal have helped to supplement outlet revenues.

“This guest portal allowed us to be nimble and quick to market by using the tools we already had available within our technology stack,” Phillips added. HT