Revinate
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The Hotel Moment podcast — episode 84

You’re capable of achieving more than you think: Going further with a direct booking strategy

In this episode of the Hotel Moment podcast, Karen Stephens, Revinate CMO, and Kathleen Cullen, Executive Vice President at PTG Consulting, explore the ways that hoteliers are leaving money on the table and why change starts and ends with a direct booking strategy. Cullen urges hoteliers to seek profitable business opportunities instead of chasing volume — with direct connections with guests paying off in the long run. For long-term success, Cullen shares that taking a closer look at how your hotel leverages and chooses technology, thinks about data, and spends marketing dollars is paramount.

Listen in and discover the areas where your hotel may be missing out on revenue and what you can do to get it back. You’ll also learn how to keep the guest experience alive in the process.

Red, yellow, and blue lines to indicate soundwaves.
Headshot of Karen Stephens

Meet your host

As Chief Marketing Officer at Revinate, Karen Stephens is focused on driving long-term growth by building Revinate’s brand equity, product marketing, and customer acquisition strategies. Her deep connections with hospitality industry leaders play a key role in crafting strategic partnerships. Karen is also the host of The Hotel Moment Podcast, where she interviews top players in the hospitality industry. Karen has been with Revinate for over 11 years, leading Revinate’s global GTM teams. Her most recent transition was from Chief Revenue Officer, where she led the team in their highest booking quarter to date in Q4 2023. Karen has more than 25 years of expertise in global hospitality technology and online distribution — including managing global accounts in travel and hospitality organizations such as Travelocity and lastminute.com

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Transcript

Intro/Outro – 00:00:02: Welcome to The Hotel Moment podcast, presented by Revinate, the podcast where we talk to leaders in the hospitality industry. If you’re looking for trends, perspectives, and stories from leaders in travel and hospitality, you’re in the right place.

Karen – 00:00:22: Hello, and welcome to The Hotel Moment podcast. I’m your host, Karen Stephens, the Chief Marketing Officer of Revinate. And today, we have the pleasure of hosting Kathleen Cullen, who is the Executive Vice President at PTG Consulting. With over 25 years of experience in the hospitality industry, Kathleen brings valuable insights into maximizing profitability and enhancing guest experience across various hotel segments. Kathleen’s contributions to hospitality have been widely recognized, earning her one of the prestigious awards at HSMAI, Top 25 Extraordinary Minds in Sales, Marketing, and Revenue Optimization. In fact, Kathleen has also written a book, which is titled Evolving Dynamics from Revenue Management to Revenue Strategy, which is also available through HSMAI. Welcome to the podcast, Kathleen.

Kathleen – 00:01:08: Thank you so much, Karen.

Karen – 00:01:10: I’m really happy to have you here. We’ve known each other for a long time.

Kathleen – 00:01:13: Yes, we met in Boston, I think.

Karen – 00:01:15: That’s right, yes, at a Preferred Hotel Group conference. They have their annual conference every year.

Kathleen – 00:01:20: Yes.

Karen – 00:01:20: So that’s actually a good place to start. So you’re the EVP at PTG Consulting. So you can tell us how that is connected to Preferred Hotel Group.

Kathleen – 00:01:28: Yeah, great question. So over the years, the company has evolved from pure hotel brands offering soft brand services — sales, marketing, revenue — to hotels looking for some platform in those areas. And about five and a half years ago, the Ueberroth’s, who are the owners of now, referred to as Preferred Travel Group, they evolved the company from pure hotel brands to hotel brands plus consulting brands. And we have PTG Consulting plus Beyond Green Travel, which is our sustainability consulting company. And I run both PTG Consulting and Beyond Green Travel.

Karen – 00:02:09: Oh, great.

Kathleen – 00:02:10: And so everything that PTG does helps independent hotels. So we work with Preferred Hotels, Historic Hotels, Beyond Green Hotels. But we also work with non-affiliated hotels. So we can help any hotel no matter what their affiliation is.

Karen – 00:02:28: Oh, well, that’s great to know. So obviously, Preferred Hotel Group has a beautiful portfolio.

Kathleen – 00:02:32: Yes. Very lucky to work with some of the best in the industry.

Karen – 00:02:36: But it’s so nice to know that if you’re an independent hotel out there and you would like some consulting services, that’s available to you.

Kathleen – 00:02:43: Yeah. And we offer revenue management services, sales, PR, and we’re completely independent to Preferred Hotels. So anybody can come to us for those services.

Karen – 00:02:56: So you’re able to leverage a variety of technology platforms and do whatever that hotel needs.

Kathleen – 00:03:01: Whatever that hotel uses.

Karen – 00:03:02: Okay. Very cool. So can you tell us a little bit about your journey to this point in your career? So I mentioned you’ve been in hospitality for a while. So where did you get your start?

Kathleen – 00:03:10: I started at the front desk of a Sheraton when I was in college. And I actually should back up. I grew up being obsessed with hotels. I was very lucky early on in my life where my family took us traveling around the world quite often, and we went to beautiful places. And as a young girl – teenage — I loved sitting in the lobby and just watching the operations — what was happening. Loved the people watching, but I also loved how the hotel interacted with their customers. So, I had an attraction to it way before I even knew really what that meant. But my first real job was working at the front desk at a Sheraton.

Karen – 00:03:56: Wow. Okay. So, you started at the Sheraton — young woman, and then you came up through the ranks. So, where did you move from there? How did you get, obviously, EVP today, but what was kind of the trajectory from the front desk?

Kathleen – 00:04:08: Well, I spent many years in operations, and I always like to share that because it means I have a really good understanding of the back of the house, how the hotel really works, and what hoteliers need in order to optimize their business — run their business. And then I was lucky enough to be mentored by a couple people in this thing that was called yield management. Back at the time, nobody really knew what it meant, but I had some amazing mentors that really trained me. That led me into the world of revenue management that I just fell in love with. And it encompassed everything from reservations team, front desk team, the technology that we used, and how we use that technology, all the way to what rates should be set, inventory management, working with the sales department for their opportunities, and optimizing all of those different areas. And eventually I went to Two Roads Hospitality.

Karen – 00:05:09: Oh, yeah?

Kathleen – 00:05:09: And I was in charge of revenue and distribution, as well as involved in a lot of new hotel openings and transitions for Two Roads. And I did that for about six years.

Karen – 00:05:20: Okay.

Kathleen – 00:05:20: Yeah. And then about five and a half years ago, I joined Preferred Travel Group to start up the hospitality portion of PTG Consulting.

Karen – 00:05:28: Of the consulting. Yeah, and I love that you kind of gave the context of your background there, because I do think it is so important. Every hotel has different needs, and you have to understand how all of those pieces work together.

Kathleen – 00:05:39: Yes.

Karen – 00:05:40: So can you give me an idea of a day in the life if you’re hired in by this independent to come in and address a problem? I know we’re sitting here at NAVIGATE in Miami. You and I are going to do a panel later. And part of that panel we’re talking about — if someone can just reduce their costs by a couple percentage points, what is the low-hanging fruit when you go into a hotel, if there is any, to help them optimize and really get on track?

Kathleen – 00:06:03: Yeah. That’s a really good question. So low-hanging fruit is one of the first things that I always talk about is taking a look at what you do have today, and how you are using your technology to process information back and forth, and how to use it to track your information. So that’s one. That is, to me, low-hanging fruit. Because many people use technology in a way that is not well-suited for their needs. So it’s understanding how to use that technology and optimize it. Then there’s also how you work together as a team. So is the revenue professional working well with the sales team, and the marketing team, and the front desk team? So that collaboration to really focus on full commercial strategy. And many hotels still go after volume versus optimal opportunity. And so that is really where you can get into it. It’s a little bit more complex, requires a lot more discussion, a lot more research. But taking a look at not just volume, where you can get your highest volume, but what’s your most profitable opportunity?

Karen – 00:07:17: Wow. Okay. So that is really the core of commercial strategy, which I think is so cool, and just because it’s just a different way of looking at it. So not every piece of business is a piece of business that you necessarily want.

Kathleen – 00:07:29: Right.

Karen – 00:07:30: Understanding your mix.

Kathleen – 00:07:31: Right.

Karen – 00:07:31: And then trying to figure out how you shift. So when a hotel says, “Kathleen, we need more direct bookings, what do we do?” Because that’s going to help you with some of that cost. So what is kind of you’re like, “Hey, this is how we start thinking about direct bookings?”

Kathleen – 00:07:46: Yeah. So direct bookings are critical. Many times we’re investing in the OTAs, for example, or third-party bookings, and we’re doing marketing through them. Why not invest those marketing dollars, those same dollars that you’re currently giving to third parties, and shift those — that investment into your own website, into your own direct booking strategy, into your own communication with the customer database that you do have? There’re many different options from digital marketing where you should be investing your money, make sure your SEO is optimized, your PPC is lined up with your strategies and campaigns that you want to drive. A lot of these things don’t require huge amounts of funds. And if you just shift some of those dollars from what you’re investing in other areas over into your direct booking strategies, that can go a lot further.

Karen – 00:08:40: Well, and I think it’s great when people can hire a consultant. Like if you’re out there and you think, “Okay, we’re a small team. We don’t really know how to do this.” I think there are organizations like PTG that can come in and say, “Hey, because if you’re doing a lot, your mix is heavy in OTAs.”

Kathleen – 00:08:54: Yeah.

Karen – 00:08:54: That’s a lot of comm-ish.

Kathleen – 00:08:56: A lot.

Karen – 00:08:56: That’s a lot of money sitting in that bucket.

Kathleen – 00:08:58: Yeah.

Karen – 00:08:59: And I think sometimes hoteliers need to think, “If I reinvest in technology or a consulting commitment and get the tool set –

Kathleen – 00:09:05: Yes.

Karen – 00:09:06: …to understand, think about as a marketing budget and shift it –

Kathleen – 00:09:10: Right.

Karen – 00:09:10: …then the payoff is going to come.”

Kathleen – 00:09:12: Absolutely. And many times people think just investing it in the third party is an easy win. Yes, it’s an easy win, but you’re not even seeing the amount that you’re spending in that commission that you just mentioned on your P&L.

Karen – 00:09:27: Right.

Kathleen – 00:09:27: For example. They’re keeping that money. You’re not actually paying that out.

Karen – 00:09:31: Right.

Kathleen – 00:09:32: …with certain models.

Karen – 00:09:33: Yeah.

Kathleen – 00:09:33: So it’s costs that you’re not seeing on the P&L.

Karen – 00:09:36: It’s hiding. It’s hiding in between markup and margin. We talk about that a lot. So if you’re writing a big fat commission check, all of a sudden your controller is like, “We know who that is!”

Kathleen – 00:09:46: Right.

Karen – 00:09:46: But if it’s hiding, then you know what you see that is in the rate, not in the markup.

Kathleen – 00:09:50: Exactly. Exactly. And you can actually be doing very well on your star report, which is representative of top line, but if you’re not looking at your bottom line, the profitability, the NOI, then that’s a big opportunity for many hotels to really start focusing on that.

Karen – 00:10:09: Yeah. I love that. I love that shift. And I love that we’re talking about that today, here. And if you’re not — you’re listening to this podcast, and we’re in the room. Where can people go to find? I know that there’s a lot of resources that are starting to come together out there. We mentioned HSMAI. We just had to talk to Jennifer Hill, who’s on another podcast.

Kathleen – 00:10:26: Great.

Karen – 00:10:26: Who’s put together a lot of documentation.

Kathleen – 00:10:27: Yeah.

Karen – 00:10:28: So what is your recommendation for somebody who might be listening to get educated on this strategy?

Kathleen – 00:10:33: Well, I think one of the leaders in this area is Kalibri Labs. They’ve done a phenomenal job in synthesizing the data for many hotel brands. And so they have a lot of data where they’re looking at the bottom line profitability. And they have a lot of experience in helping to start that conversation. What you should be doing internally? HSMAI is another great resource. They have a full publication recently launched where it’s a full commercial strategy assessment, I think is what it is, that you can actually go in and assess your own hotel to see where you are that could be interesting.

Karen – 00:11:12: I love it. The first thing you got to do is figure out where you are.

Kathleen – 00:11:15: Yeah.

Karen – 00:11:15: And then you can figure out where you’re going.

Kathleen – 00:11:16: Right. Yeah. Yeah. And then consult with PTG Consulting to help you get there.

Karen – 00:11:22: Help you get there. That’s right. So a quote that I read of yours that I love is, “Hospitality is about creating and delivering unique experiences.”

Kathleen – 00:11:29: Yeah.

Karen – 00:11:30: You’re like, yes, I did say that. Awesome.

Kathleen – 00:11:32: Somewhere.

Karen – 00:11:33: Somewhere. So can you talk a little bit about how a data-driven culture, right? We think about guest experience, which is the contact with the guests. It’s why you got into hospitality because you love it. You love the guest experience. But how does creating a data-driven culture enhance that and make it even better?

Kathleen – 00:11:50: Yes, you can look at all the data that you want, but if you’re not creating the right culture, and you’re not taking a look at the customer feedback and understanding what the customer wants and what they’re telling you, then all that data is not really going to matter because you’re going to lose that customer. These days, that customer experience and customer communication is so important. And there’s many technologies out there that help support that constant communication. Whether it’s pre-arrival all the way to when they’re on site.

Karen – 00:12:22: Okay, so it’s collecting the data, and then it’s making sure as a team you know how to go after it and operationalize it. And is that something you do as part of your consulting as well? Get the whole team together? Because I imagine, well, you tell me, but I would assume that every hotel presents its own set of things that could be optimized.

Kathleen – 00:12:39: Yeah, oh yeah. Every single client, every hotel, every culture is different. So it’s really understanding what is working and what isn’t working for that particular hotel.

Karen – 00:12:50: For that hotel. Okay, cool. All right, so I have one last question for you because this is another thing that comes up a lot. And we talked a little bit about STAR reports and comp sets. And when you think about a comp set on a STAR report, you’re thinking about hotels that are local to you that are similar in STAR rating, etc. But really, I think what we’re seeing more as we get more and more digital out there, where are hotels really competing? Like, you know, if it’s summertime and you’re a hotel, is there any looking at your comp set in your neighborhood or how should you be thinking about that?

Kathleen – 00:13:18: Yeah, that’s a really good question. And it’s definitely a direction that we need to start moving in and have more of these conversations because like you mentioned, there’re the traditional comp set measurements where we have our primary comp set, some people have secondary, some people have tertiary, some people have aspirational, and those are all great. But what I always recommend to hotels is take a look at what your opportunity is and create a comp set from there. So for example, and this is a simplified example, but who do you compete against for your group opportunities? Who do you compete against for your business travel opportunities? Who do you compete against for your leisure or luxury, super high-end luxury leisure? And those should be the competitors that you’re taking a look at for each segment of that business and seeing what you can get from each of those.

Karen – 00:14:14: And they might not be in your market.

Kathleen – 00:14:16: Most likely they’re not. Some of them might be, but many might not be.

Karen – 00:14:20: If you’re looking for a beach destination, you don’t know. I’m going to Miami. You don’t know where that consumer is coming in. So I think that we’ve seen a lot of guests that come on the podcast — we talk about how important experiences are, making sure that your website really reflects the local area, all the things that can be done. So it’s way beyond that. So yeah, that’s a good thing. Obviously, we do a lot of leisure. We think about the leisure segment a lot at Revinate. But I hadn’t thought about that for group, and corporate, and any piece of business.

Kathleen – 00:14:50: Every single segment – tour operators. There’s so many different segments that you can truly narrow down. And then I would even take it a step further and make sure that you understand where those opportunities are — who those competitors are per segment. Reflect that in your communication out to the customers, including your website. But also don’t forget about your reservation sales department because they’re critical in understanding how to talk with a business traveler versus a group traveler versus luxury leisure traveler. Those are completely different forms of communication.

Karen – 00:15:27: And they’re going to want different amenities on your property. So you need to know how to do that. Okay, so a couple of closing questions for you. So this is a fun one. So we’re in April. We’re already partially through the year. Any key lessons? I mean, every year is different coming out of COVID. And it’s moving fast.

Kathleen – 00:15:44: Yeah.

Karen – 00:15:44: So have you had any big lessons that have come so far out of this year that you can think of or anything that’s come in this summer? Like, what are your predictions of what 2024 is going to look like as we move through the year?

Kathleen – 00:15:56: Well, I think, I don’t know if this is a new idea, but I think hotels are still grappling with the ADRs that they were getting for a couple of years compared to the ADRs that they are getting now. And things have definitely stabilized. So it’s figuring out strategies to make sure that you can hold rate without losing all of that business to hotels that have lowered their rate. So I think a big one is understanding your rate strategy. And then, again, just figuring out what is the opportunity for your particular hotel, given that new concept, I’ll call it, that you’re going to go after.

Karen – 00:16:37: Right. The new piece of business. So we saw revenge travel big time in 2022. Felt like in 2023, a lot of people went internationally. So that was like, “I’m going to leave the country.” And are you seeing a return back to more domestic travel in the summertime, or is it too soon to call? What do you think?

Kathleen – 00:16:55: I think for me, that’s too soon to call. I haven’t really touched on that just yet.

Karen – 00:17:00: Okay. Yeah. So we’ll stay tuned on that one. Okay. And then one final question for you. What do you do to keep up to speed on the industry? Are there any news outlets or thought leaders or, you know, where do you find your resources when you’re out there to make sure that you’re staying informed just for our listeners who want to get more educated in our industry?

Kathleen – 00:17:17: First and foremost, it’s reading online publications, but also coming to conferences like NAVIGATE. These are invaluable because of the networking, the ideas exchange, the speakers sharing information. So to me, that’s invaluable.

Karen – 00:17:32: That’s right. All right. Well, I’m glad you’re here. That’s a great place to end it. So thank you, Kathleen. I really appreciate it.

Kathleen – 00:17:37: Yeah. Thank you.

Karen – 00:17:37: And it’s been great to see you. So my guest has been Kathleen Cullen, who’s the Executive Vice President of PTG Consulting. Thanks so much.

Kathleen – 00:17:43: Thanks, Karen.

Intro/Outro – 00:17:44: Thank you for listening to The Hotel Moment podcast. Make sure to subscribe wherever you listen to podcasts. And if you’re watching on YouTube, please like the video and subscribe for more content. For more information, head to hotelmomentpodcast.com. The Hotel Moment podcast is presented by Revinate.

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