Case Study: 10 Years of Revenue Management at Xotels
As Xotels exists 10 years this year, we wanted to share with you what it has been like. But rather sharing our own story, we think it would be much more interesting to share you what it has been like from the perspective of our longest client. The ultimate Revenue Management outsourcing outsourcing and consulting case study if you will. The very first client for our Revenue Management outsourcing services was La Bergère Group, and they are still with us after 10 Years of Xotels.
The Ultimate Revenue Management Case Study
LBG is a Dutch hotel management company, known in the Netherlands for its innovative hospitality concept. Among their portfolio the count the Qbic Hotel in Amsterdam, and in Maastricht Townhouse, Kaboom, Mabi and St Martenslane, all designed in a modern and striking style and run in an unusual and creative way.
We asked Rino Soeters, the Managing Director of LBG, how it has been working with Xotels over such a long time.
Question: How did the cooperation with Xotels get started?
‘I have known Patrick and Remko from the time they were working at Hotels.com and Expedia. At that moment they were already far ahead of their time in their way of thinking. So it was not difficult to say ‘yes,’ when they approach us with their ‘Rent-a-Revenue’ manager concept. This was back in 2006, simultaneously with the founding of Xotels. The targets were simple; increasing the revenue while creating a healthy cost ratio, and more importantly we will become your external knowledge-partner. Due to the partnership I got a better insight in the market, and was up to date with new developments as one of the first. It allowed us to anticipate and action more effectively.’
Question: How did the partnership as you call it develop over time?
‘The relationship with Xotels is still fresh and healthy. The expansion of my hotel group and Xotels at the same time has led that we have a greater distance between the operations and ourselves. This has been good actually, as we can be more pragmatic and focus on the long term strategy, instead of letting smaller operational matters distract us. Before if we missed budget on a single day, there were a lot of questions being raised. Now we look at the business less through colored glasses and make more balanced and thought through decisions. We have also expanded the services with Xotels into the area of online marketing which aligns well with their overall strategic approach to maximize revenue and profit for our hotels.’
Question: What has it been like to work together with the team of Xotels from your personal perspective and that of your hotel staff?
‘That we are satisfied in the partnership with Xotels, can be seen in our financial results. By their virtue we have continued to expand the services we contracted with Xotels. You could say Xotels creates their own clients in a way. After all, because the financial successes of my hotels I was able to grow rapidly and expand. The new hotels are also managed by Xotels. Moreover, even the websites, SEO and SEM, the social media strategy, etc. We do everything together. Xotels has become in a sense our business partner.’
‘Our sales team is sometimes bothered when the revenue manager disapproves a request. I personally enjoy this disagreement. These discussions stimulate one another to be creative and to think about: “how can I turn this “no” into a “yes” from my revenue manager. It helps my commercial team to think beyond simply converting business, and to turn a lead into the best profitable piece for our company. And sometimes we should just say no, and look for other potential business that will bring us better results.’
Question: How would you explain the nature of the relationship between LBG and Xotels? What makes it unique?
‘As mentioned, just now, we don’t look at Xotels as a provider. We are genuine business partners, and they are a part of our team. Xotels delivers results every day and every month. No nonsense, the things are as they are. I really appreciate their straightforward approach. It creates transparency. Actually I am sincerely proud to be working with Xotels, together we make our hotel portfolio grow and flourish.’
Question: What has been the impact of working with Xotels? And how has this been achieved?
As a customer of the first hour you do not always remember how ir started and how great it has been. Our recent take-over of Hotel Mabi in Maastricht city center was one of the “wow moments” for me we experienced working with Xotels. This hotel had ran for years at and occupancy of 77%. LBG took over the hotel on April 1st of this year, and Xotels managed it right from the start. Naturally, the PMS had to be changed, a new website had to be build, and new contracts with the OTA´s, yet since July (so after only 3 months!) the OCC. has not been below 95% (!), in one word: WOW!
Question: Our companies have been growing together from 1 up to 5 properties now. How did this work?
Absolutely, it is an optimal symbiosis. More revenue, better results, more confidence from the bank towards our operations, more capacity available for loans, greater ability to grow, more space for improvement within the team, with consequently better results, etc. etc. ‘The circle of life. It is a teamwork approach; LBG creates acclaimed and unique concepts, wins awards, and receives a lot of free publicity in return. Moreover, we invest a lot in sales and marketing, and score high on guest reviews. In conclusion, LBG is high in demand and this makes it easier to sell for Xotels… so; the circle is complete.’
Question: Are there anyways you could see the partnership with Xotels develop further?
‘Both our companies are creative out of the box thinkers, and at the same time very result oriented. We both have fun at what we do, which makes LBG and Xotels a unique match. But right now LBG thinks out the hotel concepts and throws it over the hedge to Xotels to roll out the strategy. I think though that we could achieve even more if we would pull the relationship further and work together on new hotel concepts. I could see Xotels become part of our concept team, and co-create new hotels together.
Question: Is there any specific moment you can think of that clearly reflects the contribution Xotels has been making to LBG
‘Oh yes. In a remote past, we cancelled the corporation with Xotels for internal reasons. Within 6 months I was back. It was a fundamental mistake.’
Question: What are your future plans in terms of your hotel portfolio?
‘Well the circle of life I was referring to before, is about to start all over again. We are working towards developing some new hospitality concepts in the future. We are going to try some things we have not yet done before. So once again exciting times ahead. As growth without Xotels seems unthinkable, so they of course will be part of this project.
And in my wildest dreams we start a successful hotel group together, with very efficient and vibrant hotels. I am 100% sure that Xotels will continue to play a role in the rest of my career.’
We wanted to share this client success story with you after 10 years of Xotels providing hotels with remote revenue manager services. Not just numbers, which is our daily world, but a story of experiences. LBG has been one of our favorite and most special clients. As Rino, we see the relationship with our hotel clients as a partnership, achieving success together. Nothing brings greater satisfaction than achieving amazing results and having a lot of fun along the way.