HotelPlanner looks to grow group bookings at ITB Berlin 2023
ITB Berlin News discusses with long-time ITB Buyer Circle member Tim Hentschel about being back at the world’s biggest travel show and what the future holds
The company has bounced back from Covid stronger than ever thanks to its innovative AI powered gig economy call centre and diverse revenue streams. It is on track to regain its group bookings by the end of the year.
Why are you coming to ITB Berlin 2023?
We have always been very active at ITB Berlin because it’s the largest travel trade show in the world. It’s the main travel event in the world and there’s nothing that even comes close to it. We are very excited to be back. I expect this will be the best attended ITB trade show there ever has been, I expect the attending parties will be bigger than they every have been, I believe this time is for celebrating the resilience of the travel industry and travel companies. We made it! We’re back! And we’re here, bigger than ever!
Can you tell us a little about HotelPlanner and what you do?
HotelPlanner was co-founded 20 years ago out of California by John Prince and myself. The original concept was a first of its kind group hotel booking technology. Today, we have grown to become a worldwide leader – we power Trivago and Expedia, Kayak, Priceline for 9+ bookings.
Since we started, we have expanded to more than just group hotel bookings, into closed user group rates for individuals and the first of its kind gig economy call centre, in over 20 different languages, with around 9,000 gig agents and growing.
How did you come up with this idea of a gig economy call centre?
When Covid hit we were forced to pivot because we were receiving a huge spike in calls but our traditional call centres were down. We had to come up with a solution and so we turned to our friends and family. We realised they could be trained and shown how to answer these calls, and that our customers actually liked the service better. We put some AI, machine learning technology behind it which reroutes the calls to a localised agent with local expertise.
Even though people work whatever hours they want, we have higher pick up rates and reservation closures than traditional call centres. This innovation has driven our tremendous growth out of Covid. We have actually tripled our revenues compared to our highest pre-Covid year. We are going to hit USD 1.5 billion in gross revenue in hotel bookings this year and half of that will be over the phone.
So the post-pandemic recovery has gone well?
We were hit extremely hard because going into the pandemic, 80% of our revenues were group hotel bookings, which dried up to zero. The only revenues left were the closed user group bookings which dropped to 30 or 40%. But thanks to this gig economy call centre, by August 2020 we had recovered 50% of our 2019 revenues, although it was a completely different market mix.
How is AI impacting the travel industry, customer journey and user experience?
We are using AI to customise our supply based on user session data, we are using it as a recommendation engine for gig agents as well as online, we are using it for the routing of the calls, to connect the best agents with the best customers and get the highest conversion. All of our calls are recorded, so we also use it to boost our customer service scores and predict what issues will arise with certain reservations which allows our customer service team to call ahead of time. So it is used on the supply side, sales side both online and over the phone and on the customer service side. We have a team of AI specialists at the company who are investigating new applications.
What are your predictions for the future of the travel and hospitality industry?
I believe that going forward AI will make voice transactions more powerful. Over the past 20 years, there has been a big migration away from phone and voice reservations for efficiency and cost saving reasons. But we believe that AI can bridge that gap and make phone and voice activated reservations as efficient as online reservations. That’s my prediction and the goal which we are trying to achieve as a company. If we can hybrid gig and AI enough, the amount of time an agent has to spend on the phone making a reservation can match the online cost structure. It’s a lofty goal but we’ve already made huge strides in the past couple of years. Hence, we are profitable with 50% of our reservations coming over the phone and 100% year on year growth.
Photo: © Beth Crockatt
Strong growth forecasted for European markets
Despite today’s economic challenges, the European market is expected to see strong growth. “Today’s headwinds are offset by strong tails winds”, says HotelPlanner’s co-founder and CEO Tim Hentschel. Millennials appetite for experiential travel and the growing number of so-called digital nomads who increasingly rely on hotel rooms for accommodation will help drive this growth. Faced with volatility in the market, baby boomers are more inclined to take money out of the market and spend on travel and “good times”. Mr Hentschel says “Between these two demographics we are seeing huge growth and strong numbers being put up.” Rising room rates is testament to this rise in demand, where travellers are increasingly willing to spend 400 or $500 USD a night and have higher expectations of quality.