Real-Time Web for Revenue Managers!

As I said, at the beginning of this series about Revenue Management. To me, Revenue Management is a combination of:

1) Strategic Marketing: Marketing Research, define the segment, build/use and try to manage the chain of value, playing with the 4P’s…

2) Strategic Finance: Segments Accountancy, RevPar, GopPar, RevPaSH (Revenues per available SEAT and HOUR when we focus our attention on increasing revenues and PROFIT in restaurants) and…

3) Web Engineering:

Web 2.0: Which thanks to Syndication We have “Channel Managers” systems who manages rates and availability for all distributors from one single system user interface.

 Web-Scraping: Which allows us to compare prices (Insiders like to call the software that able to do that “Shoppers”) and establish /assess our on-line reputation as we saw here, and now…

The Real-Time web… Real-Time web is another tool for chains of value willing to work as a single entities OR as a complex system as we describe here.

The other day, We talked about Real-Time web for Touristologists. We saw two interesting examples showing how tourism enterprises and destinations can make the most of instant and fast-update communications between all the members of a chain of value and the tourists to whom, they aim to gain their trust and add value from the beginning to the end of the trip.

Of course, Hotels and any lodging facility can use those ideas as well, but here in this post I would like to offer a customized example for Revenue Managers.

Jordi! How can you relate Real-Time Web to the daily task (short vision) of a Revenue Manager?

Good question Touristologists! Let’s see if I am able to convey my vision…

A hot topic today in Revenue Management is how to increase revenues (AND profits We Touristologistly add!!!) for every single customer. Here it’s a must to talk about ancillary and upselling services.

For starters, let’s provide a clear and, an arguable, good definition of ancillary and upselling services:

Ancillary (or auxiliary) products are close to the definition of cross-selling in CRM (Customer Relationship Management) I mean, other services that can be a good complement to the services the customer had already bought or it’s about to buy. A case in point could be… are you here in my hotel to assist a seminar about how to apply Real-Time web in Revenue Management? What about an on-line seminar before going to the conference? What about an aspirin and a massage after the seminar (just kidding!!!)?

On the other hand, upselling services is all about offering upgrades to the same service the customer had already bought or it’s about to buy. A better room, a better view… a complimentary Internet access…

It’s worth mentioning (and good to highlight!!!) that both ancillary and upselling services…

1) Can be related to services of the hotel AND any service from any member of the chain of value. We are a system, remember?

2) In order to be effective, they have to be as customized as they can be. Not any upgrade… but the one which fits the customer’s needs!

So, We have a Hotel practicing the science and art of Revenue Management. They know that in order to make the most of up-selling and ancillary products, they have to customize their offers. Their Data is saying that the most appreciated up-sellings are, to be upgraded to a king suite, follow by a late check-out and/or early check-in, also to be upgraded to a higher floor with better views.

Thanks to their CRM, Loyalty programs and Social Networking Sites activities they know which one is the favorite one, NOT for the average customer but for each of them. They also can play the game of different “versions of ME”.

So, We have the knowledge and thanks to the Real-Time web We are able to send this customized offer right here / right now. For instance, through the mobile at the moment He/She is doing the reservation!

Maybe this is also a good moment to make a suggestion for a gift (ancillary or upselling) to a loved one or a travel companion…

Maybe this is a good moment to help our customer to help us and himself… For instance, allowing him to create a group for a customized service and get a discount. Welcome to the pro-am era!

Some people will say that this is a good example of Big Data and Machine Learning. I agree! Just that I like to call it… Intelligent Systems in action powered by the Real-Time web!

Can you fulfill/developed these examples? Please, use as a base the short vision (see the picture above) of a Revenue Manager!

Ready for more? I strongly recommend you to read this article:

especially, the example provided by Jurgen Ortelee: “In his analysis for Pan Pacific hotels, convention customers paid similar room rates as corporate customers, on average, but because of the much higher propensity to rent meeting space and incur higher food/beverage charges, convention customers result in 60% higher profitability per room than corporate customers. As another example, the value of a wholesale customer, who is likely to pay among the lowest room rates, is valued more on a Total Revenue basis given his higher propensity to use hotel spa services.”

To me, it seems a good opportunity to apply our favorite tool: Segments accountancy, what else? Which will allow you to get better decisions. As I always said: Different segments, different margin… AND you must know it and act accordingly!!!

I like to finish this post with the video that I share in this tweet…

Interesting mobile app Touristologists! But… Do you think we can improve it using Real-Time web technology and Business Model related to ancillary and upselling services?

Can you write down the technological scheme and describe how to use the Web 2.0 Business Model that we talked about here?

Can you highlight the features that will transform it into a web 3.0 mobile app?

Damm it! I began to write a post and I end up writing a Study Case. I can’t help it, I am a Touristologist builder! As I often say… “Michelangelo has his Sistine Chapel Ceiling; Leonardo has his Giaconda. I have my Touristologists!”

Real-Time Web for Touristologists!

Internet is the most fabulous education tool I have ever seen! This summer I was perfectioning / sharpening up my skills in Django when, out of the blue, appeared a post in a blog talking about how the author switch from Django to Node.js. You know me! I’m only loyal to my Family and to OUR Science but when we talk about new technologies…. I’m very promiscuous!!! So, I read from the beginning to the end.
Node.js was already on my radar (you remember that Touristologists have a radar, don’t’ you?) but I haven’t gone deeper on this server-side javascript technology.
What do you mean by going deeper, Jordi? Well I mean to begin a tough and painful transformation! Basically,
A) To change my mental framework from Touristology to Web-Enginnering.
B) To change my laptop for creating presentations and answering hundreds of e-mails (literally!!!)  to one ready to test web-servers, Databases (Relational and NoSQL), my favorite frameworks (both server-side and client-side) and the incredible Eclipse (no Touristologists I’m not talking about vampires!!!). You know me, always trying to control everything! In Tourism the whole chain of value, in Web-Engineering to be a “full-stack” developer.
C) Last but, definitely, not least to change my attitude from I-know- what-I-am-doing-and-where-I-want-to-end-up, to let’s-trail-and-error-don’t-worry-about-the-pitfalls-and-enjoy-the-intelectual-journey!!!!
After reading the blog, I started a search in Internet, completed a master class by the creator of Node.js himself, practiced the ideas of this interesting blog to get my hands code-dirty and got a good definition of the Real-Time web “The real-time web is a set of technologies and practices that enable users to receive information as soon as it is published by its authors, rather than requiring that they or their software check a source periodically for updates.”
In a nutshell, the difference between normal web servers and Node.js is the same as between a trained mind dealing with multitasking and a normal one. The trained one will focus on one task when it is necessary and will focus on another when it is not. Not trained minds keep attention (resources / threads) in all tasks at all times. So they collapse or their productivity goes down!!!
Real-Time Chats… Server-Sent Events…seem to be the hot topics in Real-Time web. Are they able to deal with data in the server and in the client side? It seems so!!! Not so long ago, data-rich web application was an oxymoron (I love to use the word oxymoron, I use it to express that “To think that people willing to catch the new offer will become a loyalty customer is a good example of an oxymoron.” here).
Anyway, after getting the knowledge, I began to pass it through Touristology’s glasses (always two hands theory: Technological Scheme and Business Model, remember?) The incredible opportunities that node.js (or any of the existents and future Real-Time web utilities) provides to Tourism are, so obvious for a Touristologist that it is not necessary to provide any example…. just kidding Touristologists! Let’s see some ideas about how to use it in our beloved sector!
Imagine you want to create a mobile app which will allow a tourist guide to manage a group of 100 tourists. You want, in real time, to know where they are, to make a chat with each one of the members and to play a game (Gamification, remember?) in a customized way.
You also want to show the nearest restaurant to each one of the tourist, ordered by popularity among their friends (you choose the Yelp API to get information about restaurants and the Facebook API to get friends approvals/recommendations).
If you ask a programmer to do that they will say that it is tough: too many concurrencies, to many people accessing to your server… tough? Welcome to the Real-Time Web programming!!!
You know that one of the fundamental ideas of our science it is that we have to provide servuction from the beginning to the end of the trip, to make this possible the members of the chain of value have to get and share the 3 C’s (Content, Commerce and Community) in the ways we talked about here: Customized, Syndicated and Pro-Amized. With Node.js the creation of RestFul services in order to share the 3C’S is as easy as just wishing it! Then you can create Real-Time applications that work faster, something very important when you are thinking about mobile applications!
I find and share with this tweet and interesting example….

I know that our science is Touristology, Touristologists! But I also know that software is eating the world. Furthermore, when is more necessary the use of web 3.0 than in a trip when you (or/AND your customers) need and integrated and synchronized chain of value, able to provide the 3C’s in a fast and personalize way?
My advice? Be use to the two hands mentality Touristologists! You will end up becoming a better Touristologists!!!

Think two years ahead, Touristologists!!!

This is my advice to you today Touristologists! Detect game-changers, rule-breakers, breakthroughs… two years before they happen. Learn about them, create a team, then begin to dream about your start-up and/or offer your services as a consultant and… wait. Usually, after two years you will find a niche or get some response.

Why two years? Innovation in technology, social behavior, economic rules… can appear early, BUT they only become important when they reach a critical mass (enough people using it).

Some of the companies I advise are big enterprises, usually they tend to be not as fast as SME (small and medium size enterprises) or start-ups in adapting to new technologies. As a matter of fact, start ups not only have to adapt to new technologies, they must use them to revolutionize their sector, break the rules and be successful (here we talked about the steps to follow in order to achieve this).

On the other hand, big enterprises don’t have any interest, whatsoever, in breaking the rules. At the end of the day, they are their rules! They have a consolidated business model , they usually have technology equipment (hardware) and software that fits the Business Model and they, usually again, focus on cashing-ing from this situation/scenario rather than try to search for “The new, new thing” ,by the way, a very good book about  Jim Clark, dealing with innovation and entrepreneurial spirit. Let’s enjoy this video in order to learn a little bit more, shall we?

-What? Now we have to see and old video from the 90’s? I strongly recommend it Touristologist! You will realize how similar and timeless innovation’s rules are. As you know, I strongly believe that time isn’t linear, it is cyclical. Remember?

I recommend that you think /learn/prepare yourself for the new, new thing that will spread two years from now.

I developed (and hopefully I help you to do the same!!!) a kind of radar to detect breakthroughs. I try to pick up things that nowadays are not important but they will be.  I train myself, set-up a team, dream about a company, offer my services as a consultant and… wait. Like Hermann Hesse’s character Shidrarta “I can think. I can wait. I can fast.”

Two years ago, it was mobile ecosystem (you know that I prefer a broader vision like ubiquitous computing, don’t you?) what appears on the radar. I try to convince big enterprises to develop a mobile strategy (you know me, always the two hands mindset/framework!).

They said - Interesting, Jordi! They use a tone very similar to the one used by my Touristologists when I propose an OPTIONAL study case!!!

So, I wait…I use the knowledge to seed the desire of being a developer to my children (you can read about the experience here. By the way, they also said…. -Interesting, Daddy!

I use the knowledge to improve my classes and the other way around. You know…  "The best way to learn is to teach" Frank Oppenheimer

Finally, this summer I got a call from one big company. Can you give us a seminar about Mobile Strategy? It seems there is a big gap between creating easy apps and complicated ones. Can you help us to fill it? (We talked about the big gap here, remember?)

Of course- I reply! We can learn about how to create views both declaratively and programmatically. How to use Sqlite as a Data Base cache and how to use cloud computing feeding a big Data Base with web services and web scrapping. - I leave this in your hands, Jordi, but can you begin next week?

Do you realize, Touristologist? When they’re really interested they don’t say interesting! They just act…fast…faster!

Some of you put bizarre faces when I don’t express any desire at all to see the latest movie in theaters. How is possible that you don’t see the last film of…? Well - I calmly reply- I just wait until they pass it through television.

- What? I want to know now!

I hope that you have the same mentality with new technologies and the new Business Model they will bring, Touristologists. Do you want to meet me to see the lastest movie? I’m busy (or as you say -Interesting!) Do you want to discuss new technologies, the new business model that they will allow and foresee how to use it in Tourism? I’m all yours!

Like, for instance, how specialized tourism base on creation and management of specialized virtual communities will open wonderful opportunities for Touristologists, the lodging industry and Tourism destinations.

Or how the capacity of creating groups with an international scope can give us a competitive advantage!

Or how Touristology can train people and make them capable of creating, communicating and commercializing tourism products as we saw here.

We are living interesting times, things are moving fast and they’re radically changing our society and our lives on all levels (economically, politically, personally…)  and that means opportunities but also threats. I will put all my effort into convey to my Touristologists how to make the most of the opportunities and how to avoid the pit-falls. We are game-changers, we are the best minds working in the best sector ever. We are Touristologists!!!!

Touristology is a paradigm shift!

I like to be up-to-date with complex systems. I use related methodology while doing my PhD and I found (still find, indeed) great applications for it in our beloved sector. What do you think? “Complex Systems … investigates how relationships between parts give rise to the collective behaviors of a system and how the system interacts and forms relationships with its environment.” Different parts (Inhabitants, Public sector, Lodging, Intermediaries and infomediaries, transport companies, companies not related to the trip but to the motivation of the travel…)?... giving rise to a collective behavior?  It sounds very Touristologistly, to me!

Recently, I read a book about the evolution of complex systems. The author describes it as a paradigm shift because it changes the basic assumptions of a field. Well, in this case, my fellow Touristologist…. Touristology is, clearly, a paradigm shift!

Let’s review three examples, shall we? The first related to Tourism destinations, the second related to the lodging industry and its flavor of the month: Revenue Management. Finally, last but, definitely, not least related to intermediaries, basically, travel agencies.

- On-line travel agencies (OTA) or normal travel agencies, Jordi? Do you still divide enterprises by if they are integrated to internet or not? I don’t know about you but… I don’t go to Internet anymore…. I live there!!!

Touristology is a paradigm shift for tourism destinations, among other things because claims/proves that granted specialized and mass/generic tourism usually must coexist, in all the cases, always better: First specialized then Generic. It also claims/proves that bottom up strategies are fairest and far more effective than top down ones.

Touristology is a paradigm shift for hotels and any lodging facility. Because If we, seriously, want to increase Revenues and Profits (at the end of the day, this is what Revenue Management is all about, remember?) we have to focus on providing a good service NOT ONLY when the customer is inside the building but from the beginning to the end of the trip! We have to detect segments, customize our services and use or build different chains of value (with different collaborators, intermediaries /infomediaries… Does 1,2,3 theory ring a bell for you?

Of course, we can use Social Networking Sites! But what about creating our own virtual community, not only related to the travel but also to the motivation of the tourist?

Touristology is a paradigm shift for intermediaries, as well, which will try to manage its chain of value instead of selling packages create, communicate and commercialize for others. Intermediaries, which will aim to stop battling for a commission and will began to create, communicate and commercialize their own packages knowing that this is the way to go in order to be (and remain) competitive.

Intermediaries, which will provide services for a segment, using customize suppliers and managing the trip both in the country of origin and in the tourist destination. 1,2,3 theory, remember???

Who has to discover, implement, study… this paradigm shift? The same actors in the tourism sector focus on mass and local tourism? The ones who proudly are waiting for others to bring tourist to them?

I doubt it! I share my life with the best Psychopedagogist in town and her mind and her bibliography (Howard Gardner “Leading Minds”) say something similar to: For what we know about human cognitive development, it’s improbable that a professional in a “way of doing” see and  lead a different approach.  So, who will do that? YOU TOURISTOLOGISTS!!! If not you.. Who? If not now.. When?

Money, developers and Touristologists... Or the other way around!

To find good readings is like to find a needle in a haystack. You see a good title like “Are coders worth it?” and you say to yourself - Lets give it a try!  Then you discover a person that has multiple interests: Programming, to become a writer… And you think to yourself - Hmmm, it sounds like a consilient thinker to me! So, you keep reading and the author of the article (by the way James Somers) talks about his admiration for Douglas Hofstadter, to me, the author of one of the most fascinating books I have ever read “Gödel, Escher, Bach: An Eternal Golden Braid " then he gives a citation of Ernest Hemingway and I said “That’s it! I have to finish this article. Then I discover that you can download for free the podcast version. So, I downloaded it and did my jogging listening to it!   
He makes a review of internet evolution (I like evolution stories). To make a long story short, He talked about the first Internet bubble when in order to be successful (or try to be!) the most important asset was money. If you have money you can buy an ad during the Super Bowl and wait for the customers. At that time, it wasn’t really important to have a beautiful and fully functional web site: If you build it they will come, right?
When the dot com bubble burst, the web 2.0 and cloud computing era was born. Investors realized that big investments were no longer necessary, because you change them for variable costs! What you really need are people who create the website.
But if developers are the most important asset what happens with the business model? Business Model? Just copycat one that seems successful!
How many kayaks, bookings, groupon, gydsy will the market stand?
In the case of gydsy I was force to make this tweet!!!

Soon (very soon indeed!) people will realize that money is important, developers are important BUT to have a business model is also very important. When this business model is related to Tourism... You, definitely, will need a Touristologist!!!!

So, here we have the triumvirate of success: Money, developers and Touristologists! 

My opinion? Begin with Touristologists then developers then don’t worry about the money ... It will come!!!

Every time I stop giving classes…

Every time I stop giving classes, basically on holydays (even though Touristologists don’t take holidays, they just travel around and abroad in order to know other markets, make international contacts, plan future business…), I try to finish the big summary of everything-that-matters-to-me intellectually: Touristology, Web-Engineering, Economy, Psychology… I had an unfinished version of this big summary on my laptop, on several hard disks, on older desktop PC...
Every time I stop giving classes, I start a new version but… I have never finished it!
Why will you begin again if you know that you will be unable to finish it, Jordi? Because, this big summary is one of my utopias, Touristologists. It is something that highlights the way to follow.
This is the key, I start each new summary with the same passion and energy, using the knowledge that I squeezed in the previous ones as a base. Then I build up an improved structure over it. Each time, the big summary is better, still incomplete, but better…
Something similar happens to me when after holidays I face a new subject… a new bunch of future Touristologists. I try to build the perfect Touristologist (I’m a Touristologists builder, remember?).
Jordi, don’t you see that it’s impossible to create the perfect summary, to build the perfect Touristologist?
Maybe it is impossible BUT what if one day I achieve my goal? What if you don’t get it because you don’t try with all your guts/soul? I prefer to live this way! Trying is much better than saying it is impossible and not trying at all. This idea is carved in my brain. The day I was born I appeared in this world together with liters of water. Doctors slapped me in order to provoke the first cry… no answer… they decided that healing was impossible and they left me on a table. Then the doctors and my parents, quietly, left the room… I don’t have any memories of this moment, the only thing I know is that just thinking about it provokes in my mind, emotions, guts, a silent scream “Wake Up! You have unfinished business here!” 50 years later when experts decide that something is impossible… Well, I try! What about you?
Furthermore, I have been around here long enough to know that time isn’t linear it is cyclical. You can apply this idea to relationships if you wish, but let’s focus on intellectual activity. If you have been working with/on the web from the beginning (I mean since the first popular browser in 1993) you know that change is the only constant BUT also that, like life, its evolution is better described as a circle than as a line.
Let’s see a few examples. Shall we?
 In the year 2000, XML became very popular and everybody was talking about how this language, or meta-language to be precise, will (apart from other interesting features) allow your content to be multiplatform (using, for instance, XSLT templates), then this idea became less relevant, until now where everybody is talking about Responsive Web Design. Same idea, different terms /concepts and methodologies BUT same goal! Do you believe that it is easier to understand/achieve your goal, if you remember both events?
The same thing happens with Intelligent Systems. In the year 2000, they were very popular, then the market, academics… seemed to lose their interest. Nowadays, it appears again with a different name: Machine Learning.
Another example, is the creation of a lot of enterprises using a new technology and then disappearing when they are all are copying the same business model.
As I said, life, knowledge, evolution can be better explained with a circle than with a line! So, I will begin a new circle after holidays. I’m sure that with the right attitude I will end up near my goal!
I live with faith, dreams, hope… and those are food of the soul.
I eat and sleep properly, I exercise my mind and my body and also I feed my soul! What about you?
Finally, why does something become important to you? Because you dedicate time to it!  Do you want to be a coward? Think over and over about all the bad things that can happen to you. Do you want to be courageous? Think over and over about the prize!
Do you want to become a Touristologist? Give time, energy and dreams into it!
I choose to spend as much time as possible with my family, then with my Touristologists, then with my big summaries, because I know that you have to dedicate time to the most important things. What about you?
So, in a nutshell…
1) Try it! Because you can win and because trying is far more rewarding, far more healthy for your soul than not trying.
2) Create a framework before you change subjects! When you are tired or you don’t feel like continuing, take notes, make a summary. I can’t emphasize this point enough! It’s like climbing a mountain. You don’t want to start from the beginning again, do you?
3) Think that it is possible! As Henry Ford said “Whether you think you can, or you think you can't--you're right.”
So, here I go. After these holidays I will finish my big summary. After these holidays I will build the perfect Touristologists! I’m sure of it!
I see the bright future of Touristology before my eyes!

I’m an expert in Tourism: Focus on local tourists and mark down the price!

As you know, I like to define myself as a consilient thinker. Two of the sciences that I love to combine are Touristology (the best science ever!!!) and Web-Engineering.  Some people believe that Internet, its technologies and business model can be a threat for Tourism and for Touristologists. It can be… BUT only if you are an average Touristologist if this kind of thing exists!!!

I agree with the author of this article when he said “The great tech revolution of the last 30 years is finally beginning to metastasize into every other human domain–in other words, software is eating the world, endangering almost every job there is…. Almost every job, in every field, probably including yours, will increasingly be threatened by obsolescence and/or automation.”

I agree with Thomas Friedman the author of “The world is flat” when in his book “The lexus and the olive tree” he claims “Winners in any field today can really cash in because they can sell into this massive global marketplace, while those who are just a little less talented, or not skilled at all, are limited to selling in just their local market and therefore tend to make a lot, lot less”

These threads, losing your job and cashing in less can happen to us. Unless… We are Touristologists!

If you know your segment, know how to customize tourism services, how to use or build up a chain of value then nobody can fire you. As a matter of fact, firing you is the worst thing that they can do, because it would mean the birth of a strong competitor.

If you work with specialized tourism in an international scope you can be the kind of winner Thomas Friedman was talking about!

Yes, Jordi BUT, what about if the segment disappears, if they change tastes, if they are no longer interested in our services? For average Touristologists this could be a problem. But for you, EXCEPCIONAL Touristologists this situation is your day to day battlefield!

When a door closes, a window opens!!! This is an eternal truth. But you have to be able to see the window and not everyone is able to do that. You need a trained mind, a network of contacts and a good attitude to discover and make the most of any given opportunity. Even if the window doesn’t exist or it resists being opened you have to invent one. You have to find a way!

We are Touristologists. We can go to any place in the world, detect a segment with specific necessities related to travel OR not related to travel BUT able to be satisfied through a trip. Then we can go to any place in the world, customize the offer, and use or build a chain of value to connect the demand and the supply.

We are Touristologists, the world is our office AND we are not expendable!!!!

What about experts in tourism that still believe that local tourism is the way to go? At the end of the day - They proudly explain - local tourism is the one we know the most. So, it will be easy to get their trust, to segment the market and take care of any specific needs!

What about experts in tourism that still believe that marking down the price is the best strategy ever? The other day, I was in a seminar about revenue management, I was explaining to people working in this field that almost all scientific studies show that in hotels (contrary to airlines) if you mark down the price you don’t get enough customers who compensate price reduction and allow you to increase the revenues.

One of the attendees of the seminar began to claim - this is not true! When I mark down the price I get plenty of new customers.

It’s possible -I calmly reply. I’m sure that you also get the same margin. You use something similar to segments accountancy, don’t you?

I’m also sure that the fact that you fill the hotel with low price orientated customers doesn’t have any exclusion effect whatsoever on your regular customers.

Well, I clearly see that marking down the price provides plenty of advantages and no inconveniences!

At the end of the session, another attendee to the meeting came to me and said “ I also believe that marking down the price is a bad solution. All my competitors are doing the same thing but this season I refuse to follow the herd and I get better results.” Why didn’t you share this with the class? Well I prefer to act and get results than to talk and do the same as everybody else.

You’re a Touristologist my friend- I reply! As Mark Twain said “Noise proves nothing. Often a hen who has merely laid an egg cackles as if she had laid an asteroid.”

Anyway, software is eating the world and maybe your job. Which do you believe is a job easy to eat, the one dealing with local tourism and based on marking down the price OR the one dealing with specialized tourism with an international scope?

I’m not afraid of software! I tell software what to do! I work in activities where specialization, creativity, intuition and human touch are key. What about you? Still believing in local tourism and marking down the price?

When you decide to focus on international tourism and adding value to specialized tourism… I will be here waiting for you, my fellow Touristologist!!!