Helping Treasure Island reach untapped market with custom website & automated sourcing
Client overview
Treasure Island – TI Hotel & Casino, a Radisson Hotel, is the perennial award-winning first-class resort on the Las Vegas Strip. Privately owned by billionaire Phil Ruffin, the resort features 2,884 newly renovated rooms & suites featuring floor-to-ceiling windows with ideal views of the strip and surrounding mountains. TI also offers ten restaurants, nine bars and lounges, 30,500 sq. ft. of flexible meeting and event space, 95,000 sq. ft. of live casino gaming, elegant spa, wedding chapel and the salient Mystère by Cirque du Soleil.
The context
Small groups—those including 10-25 people and/or involving an overall spend of less than $25,000—have been an untapped opportunity for automation in the hospitality industry for many years, a market worth as much as an estimated $60 million annually for the US region alone.
For years, TI had allowed for a maximum of 1 room per reservation to be booked through the resort's website. Those looking to book 2-4 rooms had to make separate reservations on the website. These limitations created stress on the Room Reservations department, which handles bookings for 5-9 rooms, as well as the corporate Group Sales team, which handles bookings of 10 or more rooms. It is likely many customers wanting to book multiple rooms would instead book those accommodations on an online travel agent (OTA) or Wholesale website.
Under a typical scenario, if 10 friends wanted to stay in Las Vegas, they would contact TI Group Sales. That department, however, is optimized for helping large groups that, in addition to rooms, typically also require meeting space, food and beverage, AV support, and other services.
The group in this scenario, however, falls into an underserved category in online booking—they want just 10 rooms, which they would be looking to book under one or more credit cards at the same discounted rate. Unfortunately, for Group Sales there was no significant ROI in manually managing a group of that size, especially if they did not need additional services.
Lack of automation in the market for small group bookings has long been a shortcoming for the hospitality industry. TI's automation would tap out at two rooms, for example.
The challenges
Lights out automation
TI's requirements for addressing this situation were clear: create a lights-out, automated system to meet the small-group customer base's needs with minimal involvement from the hotel's internal IT team, which focuses more on operations and support than website development. Any new site would also need to have the same look and feel as the main TI website.
Attractive ROI
The biggest question on everyone's mind was whether a new system would handle enough new bookings to justify its cost, rather than simply shift revenue from one sales channel to another. In order to determine the value, the solution needed to require limited development and capital cost for the hotel property.
Avoid cannibalizing sales
A related concern was that any new website would have to address the hotel's concerns about an automated system for group bookings taking sales away from their larger Group Sales Department. In order to make a solution that enabled TI to attract new business without sapping sales and resources from Group Sales, the hotel needed an automated, rules-based system. The system needed to record revenue so it looked like bookings were coming from the Group Sales team, without any hands-on involvement from that team.
The solution
IBS Software began working with Lexyl Travel Technologies to address the unmet needs of small group booking, reaching out to businesses that might be interested in implementing an automated process that could serve this niche customer base.
Lexyl's HotelPlanner.com is the world's largest provider of online group hotel bookings and event management services. TI was already using IBS's Demand Gateway, an advanced multi-channel inventory aggregation and distribution platform that has for years delivered reservations from OTA sites, Wholesalers and Tour Operators to TI's Property Management System (PMS).
A PMS facilitates a hotel's reservation management and administrative tasks, including front-desk operations, reservations, channel management, housekeeping, rate and occupancy management, and payment processing.
The project presented an opportunity for TI to significantly reduce costs while simultaneously delivering higher levels of customer and attendee satisfaction, as well as an opportunity to instantly quote groups with dynamic pricing where desired, such as during small unmanaged leisure stays.
Lexyl created a white label website designed to reflect TI's branding. The site features real-time connectivity with a comprehensive group sourcing solution that can be deployed for direct and third-party group business, offering instant group rates with dynamic pricing via the Demand Gateway.
The new system supports yielded pre and post rates and availability and provides real-time visibility into block pick-up. Integrated upsell capabilities are used to suggest spa, restaurant, shows, and other amenities during bookings. The new solution also features integrated e-Contracting tools and supports requests for meeting space, AV, food and beverage, and other services.
The system takes the best available rate (BAR) and discounts it by a specified amount or percent, in TI's case 10 percent to create the Group BAR rate (GBAR).
Each guest within that group receives a link that seamlessly directs them to the TI-branded white-label site created by Lexyl. From that new site, they get the group rate for those rooms, and the guests are able to book the rooms without anyone from TI needing to be directly involved in the sale.
The Approach: Enhanced PMS connectivity developed by IBS Software enables the Demand Gateway to access group block details directly from the PMS in real-time as well as apply existing and new business rules within the Demand Gateway, such as Child Pricing, Meal-Plans, Resort Fees, Derived Rates, and Pooled inventory.
Instant Path: Designated group leads can receive an immediate response, without the review of a salesperson. This path is ideal for small unmanaged leisure groups. Offers can be based on Best Available rates, and real-time bookings can be enabled for guests and attendees. Deposit, guarantee, and cancellation policies can be set similar to FIT.
Intercept Path: RFPs are directed to the designated salesperson for review, acceptance, quoting, and contracting. Subsequent block creation and online, real-time bookings can be enabled for guests and attendees.
The Implementation: TI initially rolled out the new website in May 2019. The company soon added blast emails and links from elsewhere on hotel's site to promote the service and expose it to more customers.
The outcome
The new website appealed to TI because the company was not required to invest a lot of its own IT personnel or resources.
To meet those needs, IBS and Lexyl built flexible business rules into the turnkey system. Group Sales still gets credit for each sale, but they can focus their resources on larger bookings with greater ROI.
Adding an option for booking three or more rooms now takes customers to the white label site created by IBS and Lexyl.
Key results
Hundreds of group RFPs for direct business processed through the white label site
The solution is a custom white-label website for TI to link to on their direct website for all group RFPs. The automated sourcing solution and booking platform allow instantly quoted/bookable group rates based on TI business rules.
Thousands of room nights have been booked and consumed
There are a lot of business rules behind the business-to-consumer engine. If the customer ends up asking for more than 10 rooms and exceeds the threshold for self-service, that person could be referred to a separate process and even speak to a customer service representative. Using the rules based engine of the Demand Gateway, TI was able to set a guideline that requests would be routed to the Group Sales Desk if there is a request for 26+ rooms.
Hundreds of thousands in revenue has been generated – 1,200 percent growth, all incremental, with no cannibalization
Since the new system debuted, TI has been able to capture new business without cannibalizing its customer base for small bookings or large group bookings. In other words, most of the customers booked through the new system would have either booked their rooms at TI through an OTA site (cutting into the hotel's revenue), or they would not have booked at TI because there was no easy, self-service way to do so.
Other benefits
In addition to the measurable workload, phone calls and emails associated with servicing small groups have been reduced for the sales team, allowing for more focus on larger pieces of group business. Customers report higher satisfaction since group quotes and bookings are available in real-time.
Looking back, the project's timing was somewhat serendipitous. Less than a year later, the COVID-19 pandemic shut off much of the hospitality industry to large gatherings. The new system is showing its value in booking rooms for the smaller groups gathering for weddings and other activities not postponed indefinitely by the pandemic. The system's automation is likewise an asset, as hotels and other areas of the hospitality industry have been forced to reduce staff needed to accommodate small group bookings.
The new website is helping TI prepare for the eventual lifting of pandemic-influenced government restrictions on large group gatherings. The types of bookings that the new system was designed for are likely to increase well before those of large conferences, trade shows, and the other large-scale events typically hosted in Las Vegas.
