Interview with Larry Hall, chief executive officer, Hotel Booking Solutions Inc.

There exists tremendous pressure to lower the costs of distribution in the industry. And Hotel Booking Solutions Inc. chief executive officer sees it in two areas.

“First, companies that provide the industry with bona fide connectivity and integration services must continue to provide value at a low cost to the supply and demand side of our industry. Hotel Booking Solutions recognises this need to keep our costs in line so we can pass these savings to our partners,” says Hall.

The second trend appears in the way the models have changed in the industry.

“We see a clear trend away from the traditional merchant models and more toward negotiated discounts in a free sell environment. These trends require technology providers to maintain flexibility and an ability to move with speed and efficiency,” says Hall.

In an interview with EyeforTravel.com’s Ritesh Gupta, Hall spoke about direct connectivity, adoption of  XML etc. Excerpts:

How is XML promoting seamless interaction between tech-savvy travel companies? Is there enough standardization in place for this to take off fully?

I have serviced the hotel technology industry for 27 years and the lack of technology standards, particularly around network communications, has always hindered the industry. I’m delighted with the progress the industry has made over the past five years, particularly around the adoption of XML. The OTA, for example, provides an invaluable service to our industry and we should continue to support their efforts to the fullest extent possible. Naturally, the industry as a whole would benefit greatly if companies adopt these standards more quickly.

In your opinion, who is leading the way in direct connectivity? How are GNEs, OTAs and MSEs using direct connectivity?

In all honestly, I’m hard pressed to find a company that does a better job than Hotel Booking Solutions when it comes to direct connectivity, including the GNE’s, OTA’s, and MSE’s. I would argue that Hotel Booking Solutions provides hotel companies and distribution channels a means to effect a direct connect strategy with speed, efficiency, and at a low cost. Harrah’s, without question, represents one of the most technically advanced practitioners of a direct connect strategy using Hotel Booking Solutions’ Demand Management platform.

Do you think suppliers are missing out on the collective ability to build, harness, forecast and shape demand for their product by implementing direct connections?

No, I don’t think suppliers who implement a direct connect strategy necessarily miss an ability to shape their demand through a comprehensive Demand Management strategy. I do think, however, most suppliers that pursue a pure direct connect strategy grossly underestimate the cost and timeframe to achieve their objectives. We see two distinct components to the Hotel Booking Solutions model in this area; the “plumbing” and the tools to establish and manage connectivity, and the execution of strategies that help suppliers and distribution channels maximize their financial performance. Companies realize the majority of value by executing the right strategies with speed and with confidence. Hotel Bookings Solutions provides a comprehensive set of tools to begin executing strategies immediately. Companies that believe they need to build interfaces themselves, taking a long time to do so and bypassing readily available technologies, merely prolong their ability to begin executing their strategies.

How does direct connectivity enhance the quality and accuracy of information distributed between suppliers and intermediaries?

I might rephrase this question and say that connectivity in any form greatly improves the quality and accuracy of information regardless of how suppliers and distributors achieve it. I realize I’m making an obvious statement. I will add, however, that we continue to find a huge gap between what companies claim exists and what they really have in place with respect to connectivity. We see examples every day of the cost of errors from companies that lack any form of connectivity with their trading partners. No one disputes the lack of efficiency and the susceptibility to serious financial errors that exist when companies transact with one another through extranets and fax machines. Companies that fail to pursue aggressive connectivity strategies really do hurt their financial performance. Hotel operators have a fiduciary responsibility to operate their assets in a manner that achieves the highest financial returns, and the lack of connectivity with their partners means they will experience sub-optimal performance.
The big win, however comes through the ability to provide channels with real time access to changing rates and inventory. By removing the manual processes historically associated with rate and inventory updates to distribution channels, the end to end process becomes much more accurate and timely. The end result provides connected distribution channels with improved access to inventory and at rates that are driven by hotel demand.

How do you think you are in an advantageous position going forward?

I do believe we have placed Hotel Booking Solutions in an advantageous position in the industry for three simple reasons.

First, we solve a serious problem that the industry needs solved. Two, we do so at a price point that represents a fair return for the value we create for our suppliers and distributors. And, third, we do what we say we will do! We execute, and we have proven successes where we have achieved some spectacular results. Over the coming months we will begin to share some of these successes with the industry. I’m certain the industry will take notice of our accomplishments and the value we bring across the entire supply chain.