Yotel's COO on Tech Forward Low Touch Hospitality
At some or other point, you'll have a query. You'll have a frustration where something's not working and you need to chat. And you click on that chat button and you dread when you start seeing the 3 little dots moving and someone or something is talking to you, and your frustration level goes to the roof very quickly.
Speaker 2:From Hotel Tech Report, it's Hotel Tech Insider, a show about the future of hotels and the technology that powers them.
Speaker 3:On this episode, we speak with Sven Hossen, the chief operating officer of Yotel. This global tech forward brand includes 23 properties all over the world that are managed, leased, or franchised. One key to Sven's success as a leader is listening to feedback across all levels of the organization, and you'll want to hear his advice on how to build a culture that celebrates new ideas. I like to start the conversation by getting an understanding about what you do at Yotel as well as the brand itself. So if you could tell me a bit about the company, a bit about your role, your areas of responsibility, and and the things that you're working on.
Speaker 1:Great. Thank you very much, and thanks for having me on the podcast today. So I'm the chief operating officer of Yotel, and we currently operate 23 properties from the West Coast of the US in San Francisco through to our newest property that will open at the end of this year in Ginza in Tokyo, and that is across our managed leased and franchised portfolio. We, as a hotel company, are based out of London, but we have regional offices across the US as well as in Asia. And my responsibility is for the opening and the transitions as well as the ongoing management of all hotels within the global portfolio, as well as the human resource element that impacts our business globally.
Speaker 3:How long have you been at Yotel?
Speaker 1:So I'm into my 8th year with Jotel, having just completed 7 years with the company. So I've seen a huge trajectory as we've expanded both pre- and post COVID in terms of geographic expansion, as well as the launch of our long stay brand, Yotelpad. And together with that, we've seen a lot of change over the last 7 years in terms of technology as we've grown, and we've had to be rather agile in terms of our expansion and choosing the right tech partners depending on the growth of the company. Obviously, as a small entrepreneurial company, the tech requirements were very different to what they are today, having 23 properties across the globe.
Speaker 3:Can you tell me a bit about the tech stack? What would you consider your most integral software partner? And how do you think about composing that tech stack as the company changes?
Speaker 1:So, I think the, what I call the mothership of any hotel, would be the PMS, the property management system. That's the starting point because that's what we use on a daily basis, whether it be for front of house or back of house operations. That's where all the integrations come into, together with our websites in terms of distribution. So that's the most integral part for me, and that's what, you know, at the end of the day, it's the central system system that we use to be able to better manage our hotels and monitor our key metrics. As we run our businesses globally, we'll drive our average daily rate, our occupancies, our revenue per available room.
Speaker 1:And the PMS is, probably, although the most central system, it's probably the most basic answer to you or the easiest answer. But at the same time, our customer relations and our guest engagement tools are growing in importance and today are probably just as important as the PMS and our website in terms of distribution. Because once we've acquired the guest, we then need to maintain them and to build that loyalty, and there's always a cost of acquisition. So I think it's not just a case of the PMS being the central system from a day to day operation, but in terms of the longevity of the business and growing as a global portfolio across those managed, leased, and franchised properties, the way we interact with guest engagement and online sentiment analysis is growing in importance in this day and age. Especially post COVID, people are becoming far more demanding in terms of service, and they want resolution immediately.
Speaker 1:And there's very little patience, and that then speaks to the loyalty piece and speaks very heavily to the tech piece.
Speaker 3:Well, I'd like to double click into the tech stack a bit. What vendor are you using for your PMS?
Speaker 1:So we operate with 2 PMSs, one being Opera Cloud and the other one being Stayin Touch. So our transit hotels, so Yotel Air, which is more of a product that is sold by hour rather than by overnight traditional stays, That has an hourly functionality in terms of the sale of rooms by blocks of hours. So we stay in touch there, and then we use Opera Cloud in our city center and larger properties and long stay market. But we're also working on developing that hourly functionality together with Opera as we move forward.
Speaker 3:How do you think about purposely composing your tech stack? At what point do you consider adding a new vendor, or is there a point where you consider offboarding a vendor because you're not using enough of the functionality to make it worth the price?
Speaker 1:I think Yotel, being an entrepreneurial company that's gone through dramatic change in the last 7 years and dramatic growth, that's exactly what we've had to do. We've had to reinvent ourselves. We've had to ask ourselves difficult questions at times in terms of our our tech stack. We've chosen partners that are either legacy partners and software, which is, again, nothing new. Everyone has legacy products.
Speaker 1:But it's about asking ourselves and really doing a deep dive into what it is that we require and whether our partners are offering us the best solution. So, you know, you've got existing relationships. You've got best in class products. You've got suppliers and vendors that are willing to tailor to your specific needs, and it's a combination of all of that that results in the adequate and appropriate tech stack at that point in time. Now what that requires from us is a lot of agility, and we need to look ourselves in the mirror and do that, you know, post analysis, that post mortem on whether something is working or not.
Speaker 1:Because as we grow, we might be large enough to make a change, but we might not be large enough to make the next step. So it's a case of timing and, you know, constantly revising. And 2 of my great industry mentors said to me early on in my career that if you're green, you grow, and if you're not, you rot. And I always keep that in mind in terms of the tech stack. And the other one was, if you always do what you always did, you'll always get what you always got.
Speaker 1:And if you keep those mantras in mind when you're looking at your tech stack, and it's okay to change direction. It's okay to make mistakes at the end of the day, but being able to identify where your shortfalls are from a tech perspective and make the changes and do those in a sound manner, looking at what it is that is required from your portfolio at that point in time is all positive. It doesn't need to be negative. Change is constant. We know that.
Speaker 1:Our guests and our stakeholders are changing on a constant basis, and that requires us to change on a constant basis.
Speaker 3:Do you have any sort of regular cadence where you do a review of the tech stack, or, you know, is that part of your annual cadence, or is it on an ad hoc basis?
Speaker 1:No. It is constant. So, internally, we have a program which is about constant and never ending innovation. So that obviously requires people from all the silos. So it's not just operations on its own.
Speaker 1:It's together with finance and IT. It's together with the brand and the digital team, the commercial team, the finance and the development team, and working with our owners on innovation and bringing robotics and AI and efficiencies into our hotel buildings and into our developments to build smarter hotels, to build more efficient hotels, which then impacts on our efficiency and effectiveness of our internal processes, whether they be brand standards, whether they be standard operating procedures, service principles. All of them are integrated, and they are all integral to the future of our brand. And it's not just a case of doing this on an ad hoc basis. It requires a constant view, whether it be technology related to lighting or to ventilation, to kiosk check-in, to the website, to our distribution channels and partners.
Speaker 1:It really requires a holistic view, and it is constant, but it is always done as a committee. It's not done in silos because if you do it in silos, then you're going to run into problems. So you have to set yourself up for success, and that requires transparency, and that requires us to work together as a team.
Speaker 3:Is there an expectation that all of your properties use the same tech stack? Or do some properties have some of their own software? Or maybe some of the properties have amenities that require different software? How do you think about that?
Speaker 1:So, obviously, we also have some legacy hotels, so hotels that are older than our brand new properties that we're launching. So we do deal with different tech stacks or different vendors, at least, in different territories. Whilst we have our IT brand standard tech stack that we try to funnel everything through for efficiency, for standardization, etcetera, we do come across, certain stumbling blocks, but at the end of the day, as long as the equipment delivers the same service and serves the same purpose, then we can work within that environment together with that vendor, whether it then requires us to make a certain amount of tweaks on the back end, whether we have to overlay a brand screensaver or we need to make some small adjustments in terms of the standard operating procedure, that can be done. But for the vast majority, we have a standardized tech stack that we try to adopt globally, but understanding that you do have franchise properties, you've got legacy hotels that have existing contracts, existing hardware. So every decision that we make at the end of the day is made with prudence in mind.
Speaker 1:We have to be cognizant of the expenditure. And in a lot of instances, tech is very expensive, so we need to make the right decision at the right time to be able to achieve the best for our stakeholders, and that is not only at the top line, but that's at the bottom line as well.
Speaker 3:So going back to the tech itself, are there any other vendors that you're especially excited about or any vendors that work really well for your use case?
Speaker 1:Yeah. So in the last 18 months, we have started working with Zendesk very closely, and we've transitioned all of our hotels onto Zendesk in terms of our customer interaction. So we now funnel whether it be communication through Facebook, through email, through telephone, through WhatsApp, etcetera, through Zendesk. And that was a massive undertaking in terms of that transition. It's gone exceptionally well.
Speaker 1:There's a lot of benefits from having done that. There's obviously an adoption period where at the hotel level and at a head office level, it requires our crew to change the way that they do things. And humans like to take the easiest route, and it's very easy to create a habit, and it's difficult to break it. So there was obviously a period of adoption, and that required a lot of focus and time and attention. But what it has enabled us to do is to have full visibility of the communication between hotel and guest.
Speaker 1:There's a full escalation process. We can tailor the SLA for each of the various types of tickets. It's easy to search for the tickets. You can do it on a mobile app. You can do it on a desktop.
Speaker 1:You've got translation functions. So it's enabled us to communicate far quicker and far better with our guests than ever before. It's linked to a content center, so we can look at the communication. We can slice and dice the information. We can decide why it is that a guest is contacting us, how quickly it takes us to resolve an issue, whether that be a normal question, a compliment, a complaint.
Speaker 1:We're able to have far more detailed reporting and tracking of those questions and queries. We can then create tailored content to answer the guest's query in a library of articles and information sheets so that they get the information they require and it's at their fingertips rather than having to wait in a queue on a telephone call or speak to a chatbot to try and get an answer and get frustrated. And that has dramatically decreased the number of complaints that we've had. We've had a much higher resolution rate, and we have way more visibility and reporting than ever before. We understand our business now.
Speaker 1:We know why people are contacting us. Is it to make a reservation? Is it to ask for a copy of their bill? And as a result of that, we are then able to go back to our tech stack and speak to our vendors in terms of making small adjustments on their side to be able to counteract a guest having to reach out to us, where we give them what they want before they ask for it. And that's what will enable us to get ahead, to build the loyalty, to increase our customer satisfaction, which then improves our online guest sentiment.
Speaker 1:Improving the sentiment score will drive the ranking. The ranking then drives the visibility, and the visibility then drives the conversion, which, again, is a win win on the top line for the hotels. So, again, it's all interconnected, and it's a really exciting journey that we're going on with Zendesk. And, obviously, the next level of discussion with them is how we bring in AI and what AI can actually do for us in terms of further enhancements, improvements, efficiencies, effectiveness across the company.
Speaker 3:Can you tell me a bit about 1 or 2 of your business objectives? Thinking more broadly, what are you working toward at Yotel, and how is technology part of the solution?
Speaker 1:Well, I'm gonna answer it in a way that touches on some of the concepts that I spoke about earlier. It's about being culturally aware and globally minded. So, understanding that a cookie cutter approach isn't always possible, or it's not possible to the nth degree. And I use the analogy of the fast food industry. So you can't have a KFC franchise and refuse to serve chicken.
Speaker 1:You can't have a McDonald's franchise and refuse to serve burgers. But in each territory where they operate, there are local products that have been tailored to that local or cultural nuance. So in Dubai, you might have a Middle Eastern influence on a burger. In Greece, you'll have a Greek influence on the burger. And that's what we need to remember.
Speaker 1:We need to maintain the brand standards and the ethos and the values of the company, but we need to be open and agile enough to make tweaks to our tech stack and to our service delivery and to our product, that makes the hotel more approachable for guests and for our crew or our staff. So that is what we keep in mind when we're making the decisions. The cost of labor globally is going up. Our guests are becoming more and more demanding. They want instant gratification.
Speaker 1:They want instant resolution. So we know that in terms of choice, choice is growing on a day to day basis, whether it be a hard brand or a soft brand. So we need to make sure that our decisions are based on longevity and about building the brand awareness and building the loyalty and as a result, impacting our business as we grow. So one thing is about growing our portfolio so that we can be formidable in terms of an RFP process for the sales environment or for distribution because we have a hotel in every city where our corporate client needs to go. But the other thing is about building the brand loyalty and awareness so that our guests are talking about us in a positive light and that we stand apart from others.
Speaker 1:So Yotel was quite innovative in terms of our kiosk check-in or our self-service station check-in early on, well before COVID came and required us to have a tick forward and low touch environment. We had already ticked that box years ago. We use robotics within the hotel, whether that be the YoBot luggage robot in New York, as an example, or delivery bots in Miami or in Singapore or in Boston. It's about constantly evaluating that and deciding what is tech forward and what is just a gimmick. You know, what is going to bring about efficiencies?
Speaker 1:What's going to bring about satisfaction on the guest side? What is cost effective? But at the same time, what is going to add value to our operation, whether that be for eliminating a position or whether it be an added on additional service or facility. It's not always a clear cut decision in each territory. It changes from place to place, but we need to push our partners and our vendors to be able to have that eyes wide open and outward looking approach to things instead of just being, you know, close eyed and focusing inwards on what it is that we've always done.
Speaker 1:We need to challenge ourselves. So we're working on breathing new energy into all of our existing technology. We're looking at our how our kiosks can be changed in terms of AI functionality and chat functionality. It's a what is the future of challenging the status quo? Because people you know, competitors are catching up.
Speaker 1:There are new entrants into the market. There's changing customer demands. There's changing customer patterns in terms of purchasing and in terms of travel. COVID really changed everything for the world of hospitality. We had to close the majority of our hotels, but we still had to keep them operational because you need to protect the building, protect the asset.
Speaker 1:You need to flush to avoid Legionella. So it's not a case of just mothballing a hotel and walking away and waiting for COVID to disappear. We still had to maintain each of these hotels, and then we had to relaunch the hotels. And, again, starting from scratch, and there was a lot of noise and clutter within the industry because we weren't the only people closing and opening hotels. Everybody was in the same boat.
Speaker 1:So it's about reinventing ourselves and our brands and constantly challenging ourselves in terms of longevity and growth. And one of the interesting things that I dealt with recently, and specifically with regards to chatbots and virtual assistants is the emergence of AI voices. And we were listening to, I think it was 7 or 8 different voices from Poly. And when we were looking at leading chatbots for various purposes, and we were listening to the voices that AI was coming up with, and one of my colleagues asked me to try and identify which were the fake voices and which were the real voices. And I very quickly said, fake, fake, fake, fake, fake, until I got to one voice and I hesitated.
Speaker 1:And for the first time, I've heard an automated voice that was very, very difficult to differentiate as to whether it was a real human talking to me or whether it was a bot. And it was only in at one point in the conversation where there was a pause, like a human would pause to think, followed by the strange pronunciation of one word that made me realize that it was also an automated voice and AI technology. So at the end of the day, every single one was AI, but some were really bad, some were really good, and some were brilliant. And it's quite interesting to see that evolution and the entry of AI and automated technology into our industry and into our daily operations, whether it be a virtual bot that is processing virtual credit cards on a reservation, you know, auto checking in a group, whether it be a voice handling guests' inquiries, all of that is, is interesting. And, and for me, the important thing is that once new technology arrives and once you have that initial adoption, it then progresses very, very quickly.
Speaker 1:So I think the next 5 to 10 years are super important for our industry, and it's extremely exciting to see how quickly things develop and, you know, how fast things go, the pace of adoption, you know, who gets on board first, who is lagging. That was really interesting to listen to to those voices, and it was pretty much a moment of realization that this is going to happen, and it's going to happen a lot faster than any of us think. But that's the exciting bit because you need to change, you need to embrace change. If you don't embrace change, you end up going backwards. And going backwards is not an option for anyone who wants longevity and to build customer loyalty.
Speaker 1:I think the frustration is that when you go on any app, and all of us have hundreds of apps on our phones, we interact, whether it be a purchase through Amazon or Ebay, whether you're trying to sell something on Vinted, whether you're checking in with an airline, or you're using an app at a fast food chain, we all use them. And at some or other point, you'll have a query, you'll have a frustration where something's not working and you need to chat. And you click on that chat button and you dread when you start seeing the 3 little dots moving and someone or something is talking to you, and your frustration level goes to the roof very quickly because you want to speak to a person, you want to speak to a piece of technology that can actually understand you, that can solve the problem and help you instantly. You don't want to spend 15 minutes choosing preselected drop down options that do nothing but frustrate you and make your concerns even more and more profound, and have to fight with a piece of technology or a chatbot to speak to a human. And you have to say, Human, human, human, agent, agent, agent.
Speaker 1:That is not what hotel guests want. That's not what any consumer wants, and more so since COVID. So it is important that we embrace technology, but at the same time, there has to be a vetting process. So I know that there's technology where AI can manage your entire email inbox. And maybe I'm just old school, but I would always on the side of caution where I would allow AI to read my emails.
Speaker 1:I would allow AI to summarize my emails. I would allow them to propose a potential solution or resolution or an answer, but I would always want to make sure that I verified in that adoption stage that it is actually working correctly. Because what happens if your AI is hacked and AI is now on autopilot and making decisions for your business and impacting your employees and your customers, and you've allowed that to happen. And that, for me, is, you know, the knife edge where we are developing and we're progressing as an industry quite quickly, where previously we were very traditional and clunky. Now it's a case of the adoption period and the very fast paced development and progress, but at the same time, how do we maintain that personalized touch and truly understanding our business and maintaining our business if we allow everything to become too automated?
Speaker 1:So making sure that you don't allow it to go too far, where everything is automated and then your risk is far greater and you're reliant upon technology. And if something, God forbid, something goes wrong, you then have no idea how to pick up the pieces. So you always need to keep a a certain percentage of control when you're introducing new technology to make sure that this technology is operating correctly, it's right for your business. And as we said numerous times during this chat, it's important to make sure that you're constantly checking and having a post mortem review of whether something is actually still delivering what you need when you need it, or whether you need to deviate and make a change. So I think it's all a very, very positive and very exciting time for our industry as a whole.
Speaker 3:One last question before we wrap up. I am curious to hear from you. What is one thing that you believe about technology that your peers or competitors might disagree with?
Speaker 1:I think it's obvious that you need technical skill sets when you're implementing technology. Now there's two sides to the argument, whether you need to use a third party or whether you need in house skill and, and resource. And I think that over time, we moved away from in house resource and we outsourced everything. And a lot of third party tech companies have delivered our tech stack for years, and we've become reliant on third party. A lot of people still believe that that's the way to go because you outsource, there's less drain on your resource.
Speaker 1:My view, and growing view, is that perhaps we need to go back to bringing things in house because you then do away with that redundancy that I spoke about. There's always spare capacity. So by having the in house resource, you can be more agile, more flexible. You can ensure that you don't have that excess in terms of system functionality and software that you don't need, that you're wasting money on. So I think that that's probably one of the leading difficult questions where you've definitely got those who support outsourcing everything and then those who support bringing things back in house.
Speaker 1:And at the moment, I'm thinking about bringing resource back in house because that's how you can be faster, quicker to market, and you can ensure that it's tailored and that it's transparent and that it meets your needs 100%. Otherwise, often or far too often, we're reliant on third party software and tech suppliers who then run into, you know, a delay. They change the parameters, and you're at their mercy because you've invested all your money and your resource in them, and you may have nothing to show for it. Whereas if it's in house, you've got greater control. There is the risk, as with anything, but I think that you've got more agility, you've got more flexibility, you can tailor make a product and a solution that is truly what you need and that it's giving you a 100% functionality and that you are utilizing a 100% functionality.
Speaker 1:So I think that's probably what I would say in terms of a a sensitive topic between different people where there's 2 very clear views.
Speaker 3:Well, I really appreciate you taking the time to be on the podcast today. Loved hearing all your experience with technology and and how you're thinking about finding that right balance. Any final thoughts or anything else you'd like to add before we wrap up?
Speaker 1:Well, thank you for the opportunity, and I concur. It was very interesting discussing these topics with you. The only final word that I would have is about the concept of enforced hospitality. There is so much choice in the marketplace today, and, you know, in terms of technology, if we need to, as the hospitality industry, functionality that exists in airlines and in fast food currently far outweighs what we have adopted within hospitality. So we need to remember that enforced hospitality is where our clients are staying with us because they don't have a choice.
Speaker 1:Soon, there will be way more choice in terms of hotel brands that provide true hospitality and true tech innovation, and we either need to get on board or we're going to suffer the consequences. So I think that would be my parting thought.
Speaker 3:Great. Well, thanks so much, Sven. Really appreciate you taking the time.
Speaker 1:Pleasure.
Speaker 3:Look forward to hearing the episode when it comes out.
Speaker 1:Great. Thank you very much.
Speaker 3:Thanks. Take care.
Speaker 2: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.
Speaker 2: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.
