A Digital Solution to Suite Occupancy Problems

OAKLAND, CA—Suiteness, an online booking platform for luxury hotel suites, has snagged a former Hyatt VP: James Colquhoun, now SVP of partnerships & business development.

“It’s a completely new challenge for me. I’m excited to use my previous hospitality experience and distribution knowledge to help build out a new company that will solve real and currently unanswered hotel problems,” he said.

With more than a decade in the industry under his belt, Colquhoun’s last role as head of distribution for Hyatt enabled him to oversee all third-party distribution partners, including OTAs and wholesalers. He developed strategies to optimize the distribution channel mix and improve hotel profitability.

“I also gained invaluable experience and relationships as Hyatt’s board member for Roomkey.com, an online website established by six hotel chains. So, I know the industry and the people, have negotiated significant new deals and partnerships,” he said. “And, most of all, I have experience in what matters to hotels, which is increasing revenues and improving profitability. I now hope to apply all that experience to growing hotel partnerships and creating business opportunities for Suiteness.”

At its core, Suiteness is a hospitality tech company with a platform that offers online booking of multi-bedroom inventory at hotels for the first time. Travelers can book a hotel stay for a group of 4-10 guests.

“For hotels, it is an alternative distribution platform that reaches a targeted audience—one that the industry has been losing to short-term rentals,” Colquhoun explained.

Why is the ability to book suites an interesting proposition for the industry?

“For hotels, Suiteness is an appealing solution because it offers a new way to compete against major homestay companies, like Airbnb, by making it possible for a group to stay together,” said Robbie Bhathal, CEO of Suiteness, based here. “There are plenty of hotels that have a large portion of suite inventory, most of them with the ability to convert to a multi-room suite, but most of that inventory is paid for only 30% of the time. There are many reasons for this, from legacy technical reasons to a lack of marketing the best hotel inventory.”

Bhathal further explained, “The travel industry has been built in disparate pieces and through outsourced technology providers. When most OTAs started, they were connecting to hotels via the GDS. Hotels have started focusing on direct bookings so they have opened up their APIs to companies like ours. But we’re different from an OTA. Instead of treating this opportunity as a better GDS, we are integrating more deeply with the hotels. We understand a hotel’s inventory, build it in our system, and then map this onto their APIs. This way, we can unlock new inventory previously only available to front desk agents.”

Colquhoun added, “Another thing that differentiates us from OTAs is the free concierge service we offer to all members, even before they book a suite. Our dedicated team of actual people is available 24/7 to take care of absolutely anything our members might need, from finding the right suite to arranging airport pick-up post-booking. Suiteness is all about suites. We recognize the value in hotels and see them as the most convenient way for travelers to stay. Our focus is to work directly with hotels and market their best inventory to consumers.”

Suites face an occupancy problem because they aren’t priced correctly and, instead, most revenue managers use a tiered pricing structure where suites are just marked up $200 or $300 over the standard room, noted Colquhoun.

“What revenue managers should be doing is evaluating the current market price for that exact room category among their comp set. Another issue with suites is that most are either reserved for VIPs—the most exclusive ones—or, in the case of connecting suites, have not traditionally been bookable online,” said Colquhoun. “In both cases, it becomes cumbersome for the traveler to call hotels to find out about pricing, availability and even if a suite and room will connect at all. Offering connecting rooms online makes a huge difference. We are seeing a 40% higher conversion rate compared to stand-alone suites. It also doesn’t help that the practice of front desk staff upgrading guests for free has established a norm that if you tip the front desk or ask nicely, you can get a suite rather than paying for it.”

The proof is in the pudding. Colquhoun and Bhathal are seeing positive moves in terms of occupancy as a result of Suiteness.

“We are quickly gathering data and seeing results in key markets like Las Vegas and New York that show we are helping hotels meet a specific customer need for group stays within hotels,” said Colquhoun. “Our ADR results are extremely high—for Las Vegas, it is currently $646 and for New York, it is $507—our booking window is around 50 days, which is very encouraging for our hotel partners, and around two-thirds of our bookings relate to multi-bedrooms. We are also getting very positive reviews of our concierge service, which is helping customers through the booking process and helping to personalize the pre-arrival experience.”

In terms of seeing a return on investment, Bhathal says hotels have a high ROI because Suiteness offers something that most OTAs don’t—incremental margin.

“For one, we have built an efficient platform that allows minimal cost and effort for hotels to onboard. Second, we offer a performance-based business model. But most importantly, it’s not a race to the bottom for us in terms of pricing and ‘free upgrades.’ Our focus is selling hotel inventory that is typically not sold. This is very appealing as hotels can make incremental margin and a higher return in absolute dollars,” he said. “We pride ourselves on being a completely transparent platform—both for hotels and for our members. We send regular reports to our hotel partners that show their performance in-market and also generally. They are formatted so they are easily shareable internally. Our strength is in the fact that more than 50% of our team are engineers/data specialists and none of our systems are outsourced.”

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