Interview with the CEO: Where the Ancillary Industry is Heading
On August 1, 1999, Founder and CEO Kenneth Purcell opened the iSeatz offices for the first time. Now, 19 years later, we sit down with Kenneth to talk about how he sees the ancillary travel industry advancing in the next few years along with how he sees iSeatz evolving.
Over the 19-year history of iSeatz, the company has evolved from a table management system for restaurant reservations, to now an ancillary booking platform that facilitates booking of many ancillary products such as air, hotel, tours & activities, restaurant reservations, and food delivery.
This is part two of an interview series with Kenneth Purcell, part one focused on how iSeatz was started.
iSeatz: How do you see loyalty playing into customer decision-making in the future?
Purcell: Loyalty is an incredibly important component for brands to get consumers to book directly, as opposed to going through aggregators. We are seeing the OTAs come out and offer loyalty programs of their own. Every time the OTAs offer a loyalty currency as an incentive for booking through them, you then see brands offer a little bit more. So, consumers are getting branded rates and member-based discounts. This is an example of how loyalty is being used as a tool in the fight against booking through intermediaries. I don’t see that doing anything but accelerating.
iSeatz: A lot of conversation has been occurring around incorporating voice requests and the integration of the Internet of Things. Some hotels are even working to put Alexa in their hotel rooms. Do you see voice as an opportunity to sell ancillary merchandise?
Purcell: Sure. For me, voice-based search is effectively a different user experience than visual UX but it’s an entry point into the spectrum of things that we offer. That is definitely on our roadmap is to enable voice-based searching and booking of ancillary products.
iSeatz: Another topic that we’ve seen a lot of conversation around is personalization. What ways could personalization integrate into the merchandising of ancillaries?
Purcell: Ancillary products should be customized based on your members’ pre-designated preferences. It is just simply another enabler to gain more share of the customer’s wallet, if you’re able to offer the customer an opportunity to pre-designate what kind of additional products they want to see from your site.
That only works if you have a logged-in customer. If you don’t have a logged-in customer, then you have to make some educated guesses. You can do that by length-of-stay, type of travel, number of guests in the party, rate or rate class, or the product that they’re booking. You can suggest things that you would determine to be relevant by using business rules. Effectively, it’s inputs and outputs of the system to proactively suggest things that the user would like. Additionally, for your top tier or most loyal customers, offer the ancillary products at discounts or for free as part of their status.
Right now, hotels are in the very early stages of understanding that merchandising is important to their customers. The data indicates their customers expect it, and they’re booking these things in other places. Eventually, as hotels go from a sort of the crawl, of let’s just get things up there. Then to a walk, which is let’s get the right things up there at the right time. To a run, which is dynamically changing pricing, and point conversion rates for these ancillary products.
You’re going to see conversion rates increase dramatically in five years. But that’s all based on personalization, or a broad-based categorization of user types. It’s still really early days.
I look forward to the next five years of ancillary merchandising in the hotel space. When we’re on our 24th birthday, I can’t wait to see how much progress has been made in the hotel space with ancillary. I think we are going to see a very similar adoption pattern with hotels as we saw with airlines 11 years ago.
iSeatz: So, it seems like there’s been a lot of upgrades and intentional focus on upgrading the platform. What other product development do you see coming down the pipeline?
Purcell: There’s a tremendous opportunity to give guests the ability to pay for ancillary products with cash or points. Loyalty is an incredibly significant driver when customers are choosing where they stay or what airline they fly or what car they drive. We want to give our partners the ability to leverage their loyalty currencies to enable both a high degree of participation of the program through incentivize earning points for booking these things as well as give them the capability to burn points for purchasing these products.
iSeatz: Now iSeatz offers two different levels of our ancillary management system (AMS)*, OneView, that companies can use, the custom-based solution and a modular, “off-the-shelf’ product. Can you talk about the two differences and what customers they might be good for?
Kenneth Purcell: Our history has been about building fully-customized booking solutions for our partners, that meet their exact specifications and their needs. The premise has been that any company that focuses a tremendous amount on what the digital customer experience is, shouldn’t just stop with their own products and how those products are merchandise on their side. They should be incredibly conscientious about how all products are merchandised on their site along with how the products are offered. Digital experience should be everything down to the error messaging, which should be consistent with the booking experience. That is not something that a template-based solution can offer.
When you are a premier brand, and you really believe that it is important to have the flexibility to design a unique experience that doesn’t look like anyone else; it is important to build a digital asset that mirrors their exact core-product shopping experience. And so, we’ve offered completely customizable solutions, we call this version OneView Enterprise. The way we build our technology stack enable us to match any user requirement for UX or business rules that come at us.
Not all customers are in that tier of being able to invest in their third-party ancillary management systems. These companies are relegated to templates that sort of look like their sites or drag along solutions that they don’t really have any control of, but at least it’s better than nothing.
My perspective is that there’s something that is in-between those two solutions. Our mid-market solution, called OneView Essential, is designed to provide a substantial amount of look and feel match, and customization capabilities; while leveraging the modules that we have.
We have proven experience and history with the OneView Platform that powers over three billion travel bookings per year. This allows companies to have the ability to rely on our technology – which is a set of proven best practices. This allows them to have something truly unique while not having to pay the full cost of customization.
*U.S. Patent Pending