REPORT FROM THE U.S.—The universe of distribution is increasingly complex and confusing for hoteliers, with various channels eating away at the bottom line and the fight for direct bookings intensifying on a seemingly daily basis.
For that reason, Hotel News Now caught up with Sarah Fults, VP of distribution for MGM Resorts who recently assumed the role of president of the Hotel Electronic Distribution Network Association—or HEDNA.
Here are some of Fults’ insights on the state of distribution and what HEDNA is doing to advance the space.
HNN: What’s the biggest obstacle in the online distribution space?
Fults: ”I’ve thought a lot about this over the years, and you’ll hear different answers even based on what brand you’re (with). And chains have different issues than independent hotels since they have a higher cost for distribution. Many of us have challenges with technology and being able to quickly and nimbly get offers out into the market. (Online travel agencies) are spending millions on tech each year, and it’s hard for hoteliers to get those funds to continue to evolve and drive direct channels. So, we’re relying a lot on third-party vendors.”
HNN: What’s HEDNA’s role in tackling those challenges?
Fults: “One of the things we do is education, and we do it well. Distribution is still not known as a discipline of revenue. … I think it’s a combination of education, bringing topics to conferences and bringing people together. When you get hoteliers and partners in the same room, a lot of ideas happen. As an association, we’re known for our networking opportunities, but those conferences are really where ideas happen.”
HNN: What are the various channels hoteliers must keep an eye on?
Fults: “Like I said, OTAs are the best with technology. And I think there are still ways to evolve within the call center, for example, so when the guests calls, the person answering knows all their info and how to better serve up (an offer). That can all be done through tech. For booking engines, it comes down to how we recognize you when you come back. This is where I think (it’s important to get) guest experience and recognition down to a more granular level. There are so many ways to go with personalization on direct channels. … We need to tell (property management system and central reservations system) companies they need to evolve. (At MGM), we have hundreds of systems we use, and we need them all to talk to each other, feeding information on guests. It’s important for those systems to work together, and I still think we have a long way to go.”
HNN: What are the biggest misconceptions about distribution?
Fults: “I think the biggest misconception about HEDNA is that we focus just on the GDSes. That will always be a part of HEDNA, but we’ve evolved beyond just that. We help find other solutions in the industry. … I think a lot of people don’t understand the amount of systems (hoteliers) use to make everything work (in distribution). I’m on the phone all the time talking to vendor partners. My bosses are always asking me why I’m on the phone all the time. … But we need systems to make all the data move and get a product on the shelf. People don’t understand the amount of work and people it takes to get the product on the shelf. They know we have a lot of people, but they don’t understand what we do.”
HNN: Is there anything to learn about distribution from sharing-economy competitors?
Fults: “You should always watch innovative companies to see what they’re doing. (Airbnb) did a great job on their activities platform. They’re thinking out of the box. I think it’s important for our industry to watch what they’re doing and learn from them. It’s interesting for me to sit in Las Vegas now where we’re selling 40,000 rooms a night. (Airbnb) is going after business travel and guests and doing a great job developing personalization in that regard. I don’t view it as a threat but a new entrant in the market and somebody we need to watch and learn from.”
HNN: How hard is it to find good talent for the distribution space?
Fults: “It is difficult, and it has been at every brand I’ve worked for. … It is hard to train people from the ground up. We try to get people who are interested in revenue and want to try to (move to distribution) as the next step in their career. We really look for people with a knack for technology and are interested in systems. It’s complicated and takes a long time to train. One thing we’re actually going to do at HEDNA is a young leadership initiative. It was the board’s idea, and I thought it was wonderful.”