PhocusWire: In The Big Chair - Sankar Narayan of SiteMinder
Sankar Narayan took the reins as SiteMinder CEO in late 2018. He joined from Xero, a cloud accounting software company and previously held roles at technology and travel brands including Virgin Australia and Vodafone.
As CEO, Sankar has helped steer SiteMinder through the pandemic when many its hotel customers were forced to shut their doors. He has also been framing the company's strategy behind the scenes as it widens its remit to hotel e-commerce.
SiteMinder recently announced it was repositioning itself to hotel commerce. What’s behind the move and how has it been received by customers?
Billions of interactions and points-of-sale take place within the hotel industry every year and we simply call them "travel." For hoteliers, it’s just not that simple. On top of operational needs, they have to figure out how they can manage their reservations and digital payments, to the communications that create personalized experiences for their guests.
Our repositioning to hotel commerce is recognition of hoteliers wanting simplicity and choice. These don’t tend to come hand-in-hand, but SiteMinder is about bringing them together so hoteliers don’t have to compromise. The fact is we deliver critical, end-to-end management, marketing and distribution capabilities for hotels to generate more than 100 million business transactions in a normal year, through both direct and indirect revenue streams. Having this full capability, and the largest ecosystem in the hotel industry, meant that hotel commerce was a natural progression for us, from our roots in guest acquisition.
We’re still early on in positioning ourselves to our customers this way. They’ve had a helluva year, so we’ve been more focused on introducing useful product innovations and enhancements to them, and making sure we’ve been providing the support they need.
Company
SiteMinder
Location
Sydney, Australia
Website
https://siteminder.com
What changed for SiteMinder in terms of strategy during the pandemic?
Like everyone else, we’ve had to deal with short-term challenges, but our long-term strategy hasn’t changed. In fact, we’ve used the pandemic as an opportunity to pursue our longer term goals in a more focused way.
Back in early 2020, an IPO was a "strong possibility" for SiteMinder off the back of your significant funding round - has that position changed?
No. An IPO is still a very possible outcome for us over the next 12 months.
What are the priorities for SiteMinder in the next three years?
Firstly, we want to continue building out our hotel commerce platform. That means new innovations which are aligned to how hoteliers use technology and consume their guest data. Simplicity and choice will always be key.
Secondly, we want to continue investing in deepening and widening our global Partner Program. Since we launched the program last November, we’ve attracted nearly 500 partners from hotel consultants and website developers to property management system providers, and we’ve proven that it’s a program we can scale at an accelerated rate to benefit hotels globally.
And, finally, we want to continue expanding our people presence around the world. We opened our seventh office just prior to the pandemic, in Berlin, and looking ahead, we’re definitely looking to have even more on-the-ground presence in key hotel markets, be that directly through our own people or indirectly through our local partners.
Your research shows a boost to direct booking channels during the pandemic. How do you see that developing?
The growth of direct bookings over the past year has been driven in part by the increased proactiveness of hoteliers to improve their guest relationships, but it’s also been due to travel having to remain largely domestic.
Nevertheless, the larger OTAs have remained strong and I think we will start to see more third-party channels re-emerge soon. I anticipate this will happen in parallel to hoteliers investing more in their customers’ digital acquisition journey and in areas such as metasearch and payments. It’s for this reason that we’ve invested heavily in these areas, to remove the points of friction for hoteliers.
From a hotel distribution perspective, what changed during the pandemic that you believe is here to stay?
The pandemic has forced hoteliers to do more with less, and so we’ve seen a greater appetite than ever to do distribution in a smarter, more efficient and more cost-effective way. Again, it comes back to simplicity and choice.
Over the coming week, we will be launching a new platform for hotel chains and groups to achieve exactly this and the feedback from early adopters, who’ve not only saved themselves days of work but been given the chance to be more choiceful about how they spend their time, has been extremely positive.
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How do you think Google’s free booking links will impact the distribution landscape in a negative as well as positive way?
Google’s latest offering provides yet another complementary choice for hoteliers and we’ve certainly seen positive uptake among our customers. I don’t think it will ultimately replace the visibility offered by the top three spots, however.
What weaknesses did the pandemic reveal in the hotel distribution segment?
The most obvious weakness was the heavy reliance that hotels have always placed on both international travel and traditional guest segments.
The disruption was naturally evident more in certain regions like Asia, which have depended almost entirely on international tourism and acted as the gateway for corporate travellers.
The less obvious challenge was the continued prevalence of friction at every point in the digital journey. As an industry, it’s critical we stop thinking about solutions in isolation. It’s redundant to think only about the pricing on your direct channels, for example, if you aren’t also considering how to facilitate payment methods for quicker conversion.
What do you think the appetite for hotel technology investment from your customers/potential customers will be like going forward?
It will be strong. Our customers have had to make incredibly difficult decisions over the past year and have come to recognise the crucial role that technology will play in their recovery - and their success beyond that.
On the flipside, the past year has also made a number of hotel technologies obsolete, and so going forward I expect that hoteliers will demand more from their technology partners. If they aren’t seeing value for their investment, they aren’t going to stick around.
Give us your thoughts on digital acceleration in the hotel space - what direction might it take?
I believe we will only see further acceleration from here on out, even among smaller accommodation providers who’ve traditionally lagged in tech adoption. Simplicity and choice are being demanded over unnecessarily-complex legacy technologies that have lacked the ability to offer hoteliers agility.
Do you foresee consolidation in the hotel tech space? If so, what areas might be targeted?
I anticipate that the hotel tech space will remain fragmented, but we will see consolidation, as well as growth of established players both organically and through acquisitions. We, ourselves, have purposely not entertained M&A, but it’s a potential area of growth for us in future.
Ultimately, I foresee the rise of global platforms that can cater to local needs but also build on economies of scale through partners and deepening of best-of-breed technology. Scalability will be a struggle for smaller hotel tech providers trying to do it all.
In recent years we saw OTAs get into the hotel tech space only to exit again. What are your thoughts on this episode?
OTAs play a very critical and unique role for hotels. They’re the masters of what they do and we don’t expect that to change. However, other specialist companies have emerged in parallel and done a great job of carving out niches for themselves, which is a challenge for companies with more diverse business models to give as much focus to.
There is no doubt about it - hotel tech is tough! There is so much to consider, from product innovation roadmaps and development, to compliance and regulations, APIs and 24/7 support, which are all necessary to service hotels.
What’s your greatest personal learning from the past 18 months? Is there anything you would have done differently?
The greatest personal learning would definitely have to be the need among teams to be communicated to constantly and to be brought along the journey. Every leader strives for this, but it’s one of those things that you can grow complacent about, until a crisis arrives and you’re confronted with certain realities. You realize then that you owe it to your teams to be transparent about what’s happening both within the business and externally.
Since the start of the pandemic, I’ve held monthly All Hands with the entire company. They’re raw and candid, and I make sure I allocate half the time for people to feel safe to ask me any question they like, from the snacks being served in the office to what we’re doing to address mental health.
If I had known the end answers, I might’ve done a few things slightly differently but hindsight is always 20/20. With the data I had available to me, I stand by the decisions I made at every point throughout the last 18 months. They were the right calls to make based on what I knew at the time, and overall they’ve helped to place the company in a strong position.
If you met someone who just returned from space and was completely unaware of the pandemic, what would you tell them about it?
We’re not as anti-social as we look!