SAN talks to David Wohde, founder and director of new online serviced apartment booking platform Acomodeo.
• What's your background?
"After graduating from University in 2012, I worked for a hospitality company specialising in apartment solutions and on-site concierge services during big sport events (Olympic Games, football World Cup etc) for corporate clients, mainly from the media segment. Nine months later his company had to shut down, so I worked for two months as an interim project manager for BCD Travel, before I decided to found my own company at the end of 2012. EOS Project Service is a corporate travel agency, specialising in serviced apartments, also with a focus on group travel during sports events. Within two years we were able to win accounts such as BBC, Level 3 and Thomson Reuters. During the first projects I learned a lot about the serviced apartment industry and figured out that also for single business travellers this accommodation type is highly beneficial. This finding was the starting point for Acomodeo."
• How did you discover the opportunity?
"We were facing a big problem: booking apartments for single business travellers instead of groups is very expensive, since the process of finding apartments, getting offers and finally booking them is quite complex and time consuming. We had more and more requests for single trips, but wouldn't earn enough with those bookings to be profitable. When I started to think about atomisation with my co-founder, an instant booking platform was the result. We started with a prototype, made first attempts with providers and possible customers and developed the new company Acomodeo with the feedback of some early partners."
• What's the market size?
"According to our own research, the global serviced apartment market is around US$23 billion, while growing remarkably every year. Since we are convinced that the serviced apartment market will basically follow the hotel market with a slight delay, we assume that at least 30 per cent of this 23 billion will be booked through online channels."
• Are you simply focused on the European marketplace or do you have plans for global expansion?
"We aim to be a global company from day one, regarding both inventory and sales. On the inventory side we will start with around 100.000 apartments in 106 countries. Of course building the sales offices is more complex and will take longer than integrating apartments globally. But we are already serving some international clients think that a global approach is a main factor of success."
• What makes you different from an online travel agent and those already focused on the serviced apartment sector such Visit Rentals?
"One of the main differentiation factors is the booking engine which enables instant booking not only from one up to 30, but up to 740 nights per booking. We do not just filter GDS content, but built a data model catering to the special characteristics of the long stay sector. Also we enable comparability not only on property level, but on apartment type level. So far we know of nobody who brings the OTA experience to the serviced apartments sector for corporate long stay travel.
Since leisure travellers do in most cases not book long stays very often, our sales focus is on small and medium-sized companies with project focused businesses. Therefore we offer implementation into travel procurement systems, b2b billing and payment options and also a professional help desk and group booking service. As I said before, this will happen on a global basis, not just nationally.
As we figured out, the term 'serviced apartment' is still not very established due to a lack of standardisation. In addition to the efforts of the Serviced Apartment Summit, the TAS or other institutions which try to establish standards, we developed an easy classification system, based on scores for amenities, facilities and services offered by an apartment: Economy Class, Business Class and First Class Apartments. It uses business travellers' jargon and intuitively gives an idea of what one can expect from an apartment. The score system is transparent for everybody, of course.
For serviced apartment providers we offer a simple cloud extranet with a specialised property management system, in case their reservation systems are not capable of managing long stay bookings. The business model is transparent and based on a fair commission starting at 10 per cent per booking."
• What do you see as the biggest challenge for your business over the next 12 months?
"To bring enough inventory to our website and make it instantly bookable."
• What do you see as the biggest challenge for the serviced apartment sector over the next 12 months?
"The technical side: To make operators pursue digitalisation and maintain long stay availabilities and prices for online bookings.
The industry side: More standardisation regarding definitions, quality, data, rates, policies (minimum stay, cancellation etc.) in order to facilitate comparability and clarity with the aim to make it easier for potential customers to learn about the concept and consequently gain more visibility in the hospitality market.
The competition side: Since the supply is growing intensely, many operators who practiced themselves in idleness for a long time when it comes to branding, marketing and sales, are now facing occupancy rates below 85% for the first time. Many will have to learn their lesson. In future, calling the big companies within a radius of 20 kilometers of a property won't be enough."
• Have you any suggestions on what the sector can do collectively to overcome these challenges?
"Working on standards on a more international basis is one of the key factors. For example the efforts regarding transparent certificates/classification are not very global yet, but mainly national in a few countries such as Germany and the UK. There are only few global players who don't have enough visibility yet, to set standards which the industry will simply adapt. Regular events, round tables and think tanks between competitors might be annoying, but presumable worth it. When it comes to the branding, marketing and sales side, the hotel industry's insights can give impressive examples of how it can work, for both small and big operators."
• How do you quantify success?
"In no particular order:
• Number of apartments bookable through our platform
• Number of different locations (properties, cities, countries)
• Number of bookings
• Customer retention rate
• Customer satisfaction
• A high conversion rate (website visitors/bookings)"
• What's next for Acomodeo?
"First of all the launch of the platform in September, which will be more a soft opening than a big bang, to ensure smoothly running processes - which is important in the B2B sector. After that we'll have to improve the user experience on the platform, drive the sales up and - most importantly for the beginning - multiply the inventory by integrating more reservation systems and channel managers of worldwide apartment operators."