Hotel Tech Insider

SPEAKER_02:
Every one or two months we check every single part of our tech stack and think about renewing it, keeping it, changing anything about it. And one of the things we started to work with from right at the beginning was Strafe, formerly known as Code to Order, and they are a company that provide digital guest journeys. And when we started talking to them, most of the hotels that had digital check-ins needed a native app, and we didn't want that at all. So we were one of the first hotels that had a PWA to check in, so you didn't have to download or install an app and could do the whole check-in process on your phone. But now we changed our minds a bit regarding that because we don't believe that much in PWAs anymore.

SPEAKER_00:
From Hotel Tech Report, it's Hotel Tech Insider, a show about the future of hotels and the technology that powers them.

SPEAKER_01:
Today we're talking with Konstantin Ernstberger, one of the founders and managing partners of The New Group, which is a boutique hotel group that currently operates two hotels and has many more in the pipeline across Europe. Konstantin shares some really great insights with us in our conversation. You'll want to listen to hear why he chose a PMS with an open API, how he and his team leverage AI in daily operations, and how the new group uses make.com to build much of their own tech infrastructure. We also talk about finding the right balance between tech and human connection, which you might also be trying to find at your hotel. I'd like to start the conversation understanding more about your background and your current role. So if you could please take a moment to walk us through your history in the industry, how you got to where you are right now, and what you're doing now in your current role.

SPEAKER_02:
Yeah compared to a lot of other hoteliers we're quite new to the business because we opened up our first hotel in 2019 and we started thinking about hotels I think five years ahead of that and. At the moment, we just run two hotels, but we are planning, like, way more properties right now at the moment, because we set up the company to grow. Because the things we did so far worked very well, and this is why we now are looking for the new destinations and the way to copy-paste the things we just did. And well, the new company has some and we got some new partners. This is, for example, Remo Marsala, which is a person who invented a lot of famous hotel brands already. He was one of the CMOs of Thomas Cook, and he invented things like Casa Cook and so on. And he's now partner of our company. This is called the new holding, the new group. But the brand we invented has a different name, but this will be launched next year. So we now run those properties in a kind of test phase, I would say. So like means we test in all the technology, we test in all the setup, all the things we use there, but not with a final brand. So this will be applied next year after total reconstruction of the hotel we run right now and of course the new properties which are about to come. So this is the plan so far. And before that we did different things related to the industry. We run different kind of bars, restaurants. everything across that business. And then we wanted to do the step up into hotel industry. And we studied hotel industry like for two or three years. So like studied on our own and did a kind of deep dive in kind of technology setups. What do we need to set up a hotel? And then we started and it worked out quite good.

SPEAKER_01:
I was just looking at your website earlier. It looks like the hotels you're working with right now are all independent, sort of boutique hotels. Is that the plan as the company grows as well, to operate boutique-style hotels?

SPEAKER_02:
Well, in a way, but they all run with the same brand name then, after the reconstruction and after the rebranding. And with the same tech setup, the same tech stack, but it will be always adjusted to the destination and adjusted to the needs to every individual property. So this is the plan.

SPEAKER_01:
And then what is your role in the new company?

SPEAKER_02:
Well, I'm one of the founders. We work on the expansion right now. So we're always looking for new tech. And on the other hand, for the setup in general, this is not only tech, of course, but everything related to it and the way to expand right now. So this is everything that is connected to an expansion. These are our daily tasks at the moment.

SPEAKER_01:
And what kinds of hotels are you looking for in the expansion plan?

SPEAKER_02:
These are only inner city hotels and like bigger European inner cities. Yeah. All those big European cities is the target destination or are the target destinations. Well, so for the next interesting destinations could be, for example, Hamburg, Berlin, Vienna, Paris, London. So these are the destinations we're looking for.

SPEAKER_01:
What size hotels are you operating?

SPEAKER_02:
depends on how interesting the property is. It could go down to 50 rooms, but only if this property is in a strategic, very interesting or important place. But it should be something like 75 to 150 rooms. So something about that.

SPEAKER_01:
And given your background in food and beverage, is there typically an F&B component as well?

SPEAKER_02:
Yes, there is, but more like a bar with bar food component. So we don't want to operate full restaurants. And if there is a full restaurant, we would always find the right partner for it to run those restaurants. But yeah, it could be with a restaurant too, yeah.

SPEAKER_01:
So thinking about the hotels you're working with currently, what do you consider to be the most crucial technology partner to the success of those hotels?

SPEAKER_02:
I think the most crucial partner for us is Apaleo. And Apaleo is an open cloud platform, you probably know it. It's the two-way open API. And this is what we definitely need for all the things we're doing. We need it like every day. But I think this is the most important thing for any hotel in the future, like open APIs. all those legacy PMS systems, I don't know if they have a future, but I'm sure they don't, but they will change too. So probably they will have a future in a different way. But yeah, so this is the absolutely most important part for us, not only because of the API, but also, for example, the UX. The UX is a super important part for us because If you have new staff members and we train them to work at our hotel, after an hour of training, they can already check people in, check people out, do basic stuff or not even basic stuff. They can do like the whole regular process going on. Only if it gets more complicated, they probably need a bit more of training, but yeah, one hour and they're good to go.

SPEAKER_01:
How did you choose Apollo? Were you considering other vendors? What made Apollo really stand out as your choice?

SPEAKER_02:
So, yeah, we had a look at those legacy PMSs just to know what we're talking about or what it's all about, what we really took them into account. But it was about Apaleo and Muse, actually, in the beginning. And then we decided to go with Apaleo because of the better-documented API. In our point of view, the better. They transfer more information, for example, or they did then when we evaluated that. I don't know if this is still the case with Muse and all that, but they transfer more information to the OTAs, for example, regarding restrictions and other things. So, and the UX also, like Muse wasn't that bad. It was a close thing. So between Muse and Apaleo, but for us, Apaleo made the race. Yeah.

SPEAKER_01:
And besides Apollo, what other tech are your hotels using?

SPEAKER_02:
We check our tech stack every one or two months. We check every single part of our tech stack and think about renewing it, keeping it, changing anything about it. And one of the things we started to work with from right at the beginning was Strafe, formerly known as Code to Order. And they are a company that provide digital guest journeys. And when we started talking to them, I don't know, 2018, 17 or something, Most of the hotels that had digital check-ins needed a native app, and we didn't want that at all. So we were one of the first hotels that had a native PWA to check in, so you didn't have to download or install an app, and could do the whole check-in process on your phone, signing the registration form on your phone, doing everything on your phone. This is what we used or still use for part of our journey. But now we changed our minds a bit regarding that because we don't believe that much in PWAs anymore. So we think it's still a hurdle people don't want to take. So we started right a few weeks ago. We set some touch points that trigger specific actions. For example, if you want to check out And you don't want to look up for that link to online checkout or to find that PWA you installed to your home screen, or you save to your home screen. If you just want to check out, you can just scan a QR code on your door that triggers the checkout. It means like it shows your invoice and you can just pay the invoice by clicking pay and it charges you a card on file. And after that, charge you, good to go, you can leave the hotel then. So this would be a possibility without having to think about a PWA or a native app or anything else.

SPEAKER_01:
Are you working with a vendor to do the QR codes?

SPEAKER_02:
Yes, we do. This is a very small vendor. This is like, I think, a two-people business, and they just create very quickly things that we want to. And if they're creating things… So this is able due to the open API of Appaleo. They just say, like, hey, if you think about having a QR code to check out, so you don't have to look where your PWA is, you just scan the QR code. And yeah, they just created it and we connected it. So it's a very small vendor. It's called, I think, Paygym.

SPEAKER_01:
And then is there a unique code in every guest room so that Apollo understands, you know, who the guest is, who's scanning the code?

SPEAKER_02:
Yeah. So it's like only inside the room. So like, if you exactly know, if you're inside the room, you're able to scan that code nowhere else. Yeah. This is it.

SPEAKER_01:
Do you have other QR codes throughout the guest experience? Like if someone needs to speak with the front desk, how would they get in contact?

SPEAKER_02:
Yeah. And therefore we have like different tools for that, like the regular multi-channel messaging. So you're always in touch with front desk, wherever you are, even if you did not arrive at the hotel yet. So you're on your way to your hotel. You can already chat with us. Of course you can do in many hotels. The difference is that we are one of the hotels that. deliberately do not use AI chatbots for those conversations. And for a reason, because I mean, AI chatbots are good in that. They can provide any information and if they are connected to a large language model, they are Like almost perfect but they have one problem and this is why we don't do it because as soon as you create that a iron tech environment what we do we want to keep that personal human contact as good as possible means. If you start your conversation via chat, it can transfer seamlessly as soon as you enter the hotel. For example, if someone texts the concierge, like, hey, can I bring my dog in your hotel? And they're answering, yes, you can. And then the person enters the hotel without the dog, they immediately also, hey, where's your dog? Why didn't you bring your dog? Or something like that. Conversation just keeps going. And otherwise it would be a complete new rival. So like you don't know the person. Every personal and human contact is what we do with the additional resources we have right now, because every one of the staff has way more time now as we apply so much of AI and automation that we use the time, but we use this for our guests and not to automate conversation as well. Because this is what the experience we had. People don't really want to talk to AI because this is what they could do at home. They could talk to GPT as long as they want to. But if they come to our hotel, they want to talk to us, to locals. And this is what we keep up. Well, we have a lot of AI going on in the hotel.

SPEAKER_01:
And what tasks are you using AI for?

SPEAKER_02:
Well, the latest one is Hotelistat. This is a revenue management software. And this is very interesting because Hotelistat is now AI based. And we used to have this stuff before, but it was like all the other revenue management system based on algorithms that calculated prices and manual inputs from our side. But the version two is now based on real neural networks that were trained for months with our data. And now it is also, after we started using it, it's also trained by our inputs or by my inputs, for example. Because these types of learning are very important, because every day I have to get less imports, because it starts to understand what strategy I'm following, for example. So this is very powerful, and it gets more and more powerful every day, actually. So Hotelistat is one of the, I would say the most important AI part, because I think revenue management is the best use case for AI. I mean, there are many use cases, but revenue management is actually the best because AI can definitely do better revenue management as humans can, because you have so many factors that you have to take into account. For example, like reviews, events, weather, search requests, all the competitors on the different categories. Yeah, and this kind of reinforcement learning you have by my inputs, or the AI has, this is important too, because it understands how we evaluate the micro market we have around us, or our concept, and to get this way of thinking also into this network. And yeah, this makes it almost super powerful after a time.

SPEAKER_01:
And then is that connected through an API to Apollo?

SPEAKER_02:
Yeah, sure. Sure. Yeah. This is how it gets like the data from our hotel, like occupancy availability and so on. And yeah, writing back new prices.

SPEAKER_01:
And then how do you get those prices out to third party channels? What are you using for channel management?

SPEAKER_02:
Well, we use SiteMiner, but this is a thing we don't work a lot with. This is for us, it's a good tool and it works well, but this is just a tool for us. It's like it transfers data from A to B, but it works well. Yeah. So we don't work a lot in SiteMiner. We do this kind of work in other tools.

SPEAKER_01:
And what about your own website? Are you using a third-party booking engine or is that powered by Apple IO?

SPEAKER_02:
No, this is a third-party booking engine, because Apaleo has no own application. So Apaleo is like, don't provide anything external, so you have to add always third-party things to Apaleo. And in this case, we're using My IBE. This is a simple and easy IBE. And we have some features connected with another tool that we are using a lot now. And this is make.com. So we improve the features of the IBE by make.com, for example.

SPEAKER_01:
So are those like widgets sort of that plug into the booking engine or what sort of features would be added through that one?

SPEAKER_02:
Like make.com is one of the no-code platforms or low-code platforms. It means that we can do almost anything with it, and we actually do. So, for example, at the IBE, we added make.com looks into new bookings. that were made through the IBE, scans the comments made, and then triggers different actions, for example, and sending out, if a special request that is related to housekeeping, it will send an email to housekeeping and a message, whatever channel is used, a message to housekeeping, and informs them that, hey, there's a booking next week, they have a special request, so probably you have to already prepare for it, because one day in advance wouldn't be enough. So these are things that we could automate with make.com and can automate almost anything with make.com. This is what we do. Every month we create one or two more new automations.

SPEAKER_01:
And that's great that you don't need to have an engineer or an agency come in and help you with it. It seems very self-sufficient.

SPEAKER_02:
Yeah, this is what it makes so powerful because we don't need any programmers or anything like that. So the combination of make.com and large language models like JGPT makes it super powerful that we can do like programming on our own. This is like democratizing programming in a way, because we can do own connections to automation super quickly and super powerful on the other hand. And this is what we already did. So make.com is now one of the, I think, top three powerful tools that we use.

SPEAKER_01:
Are you automating communication to guests through this tool as well? Like a confirmation email or something like that?

SPEAKER_02:
This is what we actually do via still wire-strafe, but we could do it via make.com, too. You can easily automate it with make.com, too. And we do some automations with make.com. But more of those special cases, for example, if a payment failed, we would trigger an automated information to the guests that their payment failed, and they have to redo it, and we send a new payment link out to them. And with that payment link, they could easily redo the payment or choose another credit card or anything else. So without that, it would have just failed, and we would have seen in Appaleo the notice that there's a failed payment, and we would have to take the action and to contact the guests. Ask for a new payment method. So we don't have to do that anymore. This is all automated now.

SPEAKER_01:
What system are you using for payments or accounting?

SPEAKER_02:
Well, this is also Apaleo Pay. Apaleo Pay has the huge advantage that it's super connected to or integrated in Apaleo. So this makes it even easier regarding automation and accounting. So I mean, except housekeeping, we could run the hotel without staff. So we don't want to do that, but we could.

SPEAKER_01:
It sounds like there's quite a lot of data coming in between revenue management system, the PMS, all the communications from guests. Are you using an analytics platform or a business intelligence tool?

SPEAKER_02:
Yes, we're using different ones. So like, on the one hand, we're looking at some reports of Hotelistat, like the revenue reports that those are created in Hotelistat. And on the other hand, we use, for example, Microsoft Power BI to get some other reports we need. And this is also through the Appaleo API. So it always comes down to the Appaleo API, like everything we use.

SPEAKER_01:
Are you using any system for reputation for guest reviews or social media?

SPEAKER_02:
Yeah, this is also covered by Hotelistat. There we have an overview of all the reviews that we have. And in this regards, we improved reviews a lot since this whole, I think a year ago when JetJPG was released, this kind of AI race started. This was kind of our feeling. And when this AI race started, we thought about how can we be among the leading group in this race. And this is, everyone will apply new tech, the new vendors, everyone has access to those vendors, everyone will change the cloud platforms, their PMS systems. So this is like a basis you have to, you can do, but it doesn't make you win the race, actually. In our opinion, it's like the way that the human part acts together with the AI part. And this is why we Started to train our staff with psychologists and we developed our own way handling this new environment. And this worked out so well that reviews increased a lot. And people are way happier than they were before because they now feel super comfortable in this new environment because their tasks changed completely. Like before they were handling registration forms, looking for payments, doing administrative stuff. they don't have to do anymore. So now they are fully focusing on guests. And this is a thing that we trained a lot regarding not like following scripts, for example. So like communication always has to stay authentic, because if you follow a script as a staff member, I could probably follow a script too, but people want to meet those different personalities in a hotel, and this is what they still do. But of course, not everyone, because if someone is in a hurry and just don't want to talk a single word, you also have the possibility to. You just go to your room and do whatever you want to. But people who are there to experience the city they're into and the locals and want to get in touch, this is like the authentic communication they want to have. And this is what we trained or prepared our staff for. And they are absolutely up for it. It means they have super authentic communications with the training they had. This means like reading a body language of someone. These are things that, I mean, we're always talking about nowadays. I mean, six months ahead could be a total different environment. So probably AI changes so fast. We do not plan a year ahead. But for now, reading body languages of guests is a part that our staff does. And regarding that, they give the right infos in our systems again and know like probably how to handle each guest.

SPEAKER_01:
So you mentioned that every couple of months you review the systems you have, you take a look at your tech stack and decide whether to renew or switch something out. What sort of metrics do you look at and how do you decide if a system is working well for you or not working for you?

SPEAKER_02:
Well, this is super individual regarding which system it is. So first of all, we look for what we use it and how many use cases we still had in the past. And we always check for other competitors of the vendor, like, is there something new or better out there or new ideas, actually. But most of the time, the approach is a different one. Like, we have new ideas, and we want to say, okay, how can we get this into reality? And therefore, we say, okay, this vendor we have right now is not able to do it like we want to have it. And then we think about looking for another vendor that can probably do what we actually want to. If not, we look like, can we do it on our own with make.com, for example? Can we create own automations that have this outcome we want to have? And then we try to find the best way to get to where we want to.

SPEAKER_01:
Looking ahead, is there one vendor that you find particularly innovative that you have not implemented yet? Maybe something on your wish list?

SPEAKER_02:
Well, it's like I said before, it is exactly the kind of wish list that we have, we have a wish list and we have something on it, but we don't have the fitting vendor to that. This is like, we think not yet, probably we are looking for it. We think everything is focusing on a kind of hyper individualizing. So like this is where things are going. And this is what we've now tried to build in a way, probably in our own, but we're still looking for some vendors. But I think we're going to build it in a make.com environment. And it is something like... Because we are focusing on customer-based journeys. So the journeys are super individualized and also are customer-based pricing. So we don't want to sell rooms to everyone for the same price. So to make it more different or to make it... more customer-based. Therefore, first of all, we have to have the guests on our website to do that. And then we need more information and more than the digital footprint, we need more information that is provided by the guests. And after that, we can adjust prices individually.

SPEAKER_01:
So there's no vendor that you've found that offers this, correct?

SPEAKER_02:
Not the way we wanted to so far, but we're still evaluating and looking around and looking if we can do it, but I think this is a part because we want to change it very fast and adjust it very quickly. And so it would make sense to do it on our own with make.com. Normally, we would always prefer the vendor over building anything our own, except it is so new that we would try it or to give it a try in our own environment and then talk to other vendors to implement it. This is what happened in the past several times.

SPEAKER_01:
So switching gears a little bit, I'm curious to hear about one or two high-priority business objectives that you're working toward, and how does technology help you get there?

SPEAKER_02:
Well, yeah, the one I just mentioned is one of our business objectives, like the customer-based pricing and customer-based journey. This is what we are really focused on right now. As I mentioned, technology, especially make.com, helps a lot to do it in a way. But also some other parts we recently added to our tech stack is, for example, Alexa for hospitality. And we have this connected to our API, of course. And this is, by the way, the only If you call it a chatbot, Alexa, a voice chatbot, this is the only chatbot we really use, because this is supplementary to our staff, and we always get the link back to our team. Just to give you an example, if you say like, hey Alexa, I want to check out, please. I say, yeah, okay, you get a, Open balance of 30 euros. Should I charge it to your credit card or file? Yes, please. Okay, I charged the open balance and I created the invoice and I sent the invoice to your email. So you're good to go now. But don't forget to go down to the bar and say to the guys that Alexa invited you for a coffee, for example. So this is getting the link back to our staff and that the last touch point is not Alexa or you're alone in your room. You just, you have the opportunity to go into the bar and have a coffee or coffee to go, whatever, before you head over to the airport means you have the possibility. You don't have to actually, you can just leave, but we always want to involve like personal touch, which is important for us to make this difference that we actually do at the moment.

SPEAKER_01:
I'm wondering, from your perspective, given that today's hotel industry is so dynamic and technology is always changing, what do you feel are one or two key skills or characteristics that hoteliers should have to be successful today?

SPEAKER_02:
I think this is also the emotional intelligence. And this is what we, as I mentioned before, that we train with the team, with Playcologists, because I think this is super crucial to make the difference in the whole tech environment. And you have to anticipate the guests' needs in a way. mean as long as AI can't because you're not checking on everybody's body language so probably I will be able to do that maybe already or in six or 12 months ahead but for now our team does it and this is a very important skill you just have to have and to find the right balance between AI automation and which tasks should be done by the staff so like that you don't automate the wrong things or probably don't automate things that you should. So I think this is a skill that people are dealing with at the moment.

SPEAKER_01:
Last question. This is always a fun one. What is one thing that you believe about technology in the hotel world that other people might disagree with?

SPEAKER_02:
I think the most disagree with is what I experienced is the hyper individualizing that most of the people don't think that this is the way the industry is developing to. But in our point of view, it is because this is getting super, super important that you get super different journeys for every different kind of guest. And This is one part of another part is probably still the human part i said like the emotional intelligence because people are so focused on AI and automation we are to be. Always think about what to do with the staff because the job profile the jobs. Change and we have to face the challenge to make those jobs that they fit perfectly to the new environment and everybody get the right skills to work in that environment so everybody has to understand what is going on in the hotel processes work. how everything fits together and what is the result in the end and why they make the difference. So this is what they have to know and what we have to train people. So we do not only have to train the neural networks, but also like the human intelligence, of course, regarding the new challenges on AI and automation. And this is what I see like most of the Hoteliers don't do enough yet. They just apply technology and don't take the staff with them. I mean, jobs definitely change. I mean, all those jobs that were did repetitive tasks or routine tasks that do not exist anymore yet already. And all those jobs which need this human interaction will become more and more important and better paid, of course, because you need less staff, but you need higher qualified staff because they have to be really into it and they really have to understand what is going on. how to use all the tools, and on the other hand, how to interact with guests.

SPEAKER_00:
That's all for today's episode. Thanks for listening to Hotel Tech Insider produced by Hoteltechreport.com. Our goal with this podcast is to show you how the best in the business are leveraging technology to grow their properties and outperform the concept by using innovative digital tools and strategies. I encourage all of our listeners to go try at least one of these strategies or tools that you learned from today's episode. Successful digital transformation is all about consistent small experiments over a long period of time. So don't wait until tomorrow to try something new. Do you know a hotelier who would be great to feature on this show? Or do you think that your story would bring a lot of value to our audience? Reach out to me directly on LinkedIn by searching for Jordan Hollander. For more episodes like this, follow Hotel Tech Insider on all major streaming platforms like Spotify and Apple Music.