How about taking advantage of the crisis and turning it into an opportunity?

We are celebrating the eighth anniversary of Beonprice, and we want to tell you how the ideas that arise in times of crisis sometimes become the best opportunities of your life.

By Rubén Sánchez, CEO & Co-Founder Beonprice

Artículo escrito originalmente en español. Puedes leerlo aquí.

It is now one year since the start of the pandemic in Spain and eight years since the birth of Beonprice. Given that we are living in strange times that we could never have imagined, I am pondering on where we are at Beonprice and how we got here, even overcoming such an important setback as the one caused by the COVID worldwide.

Emilio and I had been working together for more than 6 years in a tech company in Salamanca, developing technological projects for different sectors and markets, when we started to think that the time had come to lead our own project. In the middle of the recession due to the banking and real estate crisis, in May 2012 we decided to turn our lives around and fight for our purpose of doing something big and disruptive at an international level.

At that time, the Founder Institute, one of the largest accelerators in Silicon Valley, arrived in Madrid, and we jumped on board with a clear business idea. A family member related to the hospitality industry sparked our interest in the challenges faced by hotels and we found it an exciting world whose transformation we wanted to be a part of.

We immediately started to analyse the business model. We spent four months developing the business plan and creating the company with the mission of transforming the hotel sector, providing a high value solution that was easy to use in all areas of the hotel.

Fitur 2013, our first milestone

With the business plan in place, we started talking to a large number of hoteliers to find out how they managed their revenues. We realised the biggest challenges they face on a daily basis:

• Determining which product to sell at what time and at what price for each customer, and in which sales channel to capture the segments that bring the maximum profitability.
• Update the daily offer for the next 12 to 18 months with sufficient frequency to respond to the dynamism of demand.
• Align decisions with the strategic position of the hotel.

In my more than 20 years of experience in the technology world, I have never encountered a more ambitious technological challenge than this one. Moreover, we could not find a solution on the market that was agile, efficient, comprehensive and easy to use: there was a huge opportunity.

Finally, we launched our first version of the product at FITUR 2013. It was a solution that provided data to help hotels make decisions about sales strategies, based on information about competitors, disparities and online reputation.

After the launch we started to grow very fast in Spain and Mexico. I always say that the key to success at this stage was to follow Steve Jobs’ philosophy: start with the customer experience and continue with the technology.

“The key to success at this stage was to follow Steve Jobs’ philosophy: start with the customer experience and continue with the technology”.

An RMS that puts the guest at the centre

Bearing in mind that data was going to become a commodity, it was no longer just about assisting in decision-making, but we had to become the brains of the hotel organisation, offering solutions based on knowledge, based on artificial intelligence and aligned with the commercial strategy of each company. The RMS's that were on the market were mainly in the United States and used algorithms that made decisions based on historical data and the evolution of hotel bookings.

We wanted to bring a different point of view, placing the user at the centre of the RMS decision-making process. To do this, our algorithm incorporates the guest’s purchasing behaviour during the room booking process: it takes into account the services offered by the property and the value they have for each market segment, as well as the offer of competing hotels. This way, we can analyse customer expectations and make the best decision on the price at which we have to sell each room in each channel. Knowing the competitive positioning according to the quality-price ratio allows the hotel to increase customer loyalty and maximise revenue according to the demand at any given time.

First big contract and international growth

When you launch a technology startup, the first challenge is to know if the solution you have in mind and are developing is going to have customers willing to pay for it.

Commercial launch and first big contract: this happened in 2013 and we got our first customers. That year the objective was to validate our product in order to grow and expand in Spain. In September that same year we signed a contract with Iberostar, which was an important milestone that gave us the opportunity to provide service to their international network of hotels. The company made a qualitative leap, not only in terms of the quality of the solution, reliability and agility of the information, but also in the development of the support service in different languages and time slots.

International growth: We began our international expansion in Mexico. In 2015, we entered the main hotel chains in the country and adapted our solutions to the Mexican market. This was followed by Colombia.

Development and launch of RMS: It was no longer just about providing market intelligence information, but through machine learning algorithms we took a step forward as a Revenue Management solution, making commercial decisions based on the high dynamism of supply and demand, aligned with the hotel’s strategy.

“We took a step forward as a Revenue Management solution, making commercial decisions based on the high dynamism of supply and demand, aligned with the hotel’s strategy.”

Lifelong learning: In addition to our initial experience at the Founder Institute, and after becoming Endeavor entrepreneurs we also spent different training periods in cities such as Cambridge, San Francisco, Boston or Helsinki. Continuous learning and the development of a good network of professional relationships were key to moving on to the next levels of our company.

The consolidation of Customer-Centric Revenue Management

Beonprice has become a benchmark RMS. Our hallmark is our focus on the end customer, the Customer-Centric Revenue Management approach is part of our DNA. We are the only RMS where decisions are oriented towards the hotel’s end customer, making recommendations that take into account the overall quality of the hotel and the guests’ purchasing behaviour. We have a Big Data technology platform that allows us to obtain data from multiple sources and different countries, and capture much more information than our competitors.

“Our brand identity is customer-centric revenue management”.

At Beonprice, in addition to analysing internal hotel data, we collect external data on the market related to public prices, product quality and online reputation. We use this information to create an overall quality score for each hotel: the Hotel Quality Index (HQI™). Analysis of this variable, together with the hotels’ pricing strategy allows us to estimate the sales probability of each hotel in a competitive set at the price they are selling at, as well as to assess price elasticity. When we combine this information with our client hotel’s demand forecast, we can make more accurate price recommendations per room and rate type to ensure that hotels maximise their profit per hotel and rate type.

COVID, a stop along the way and keep on growing.

In the first half of 2020, during the COVID crisis and thanks to the last round of funding, we decided to strengthen the company’s management team, incorporating profiles with extensive experience in expansion processes.

Today we are facing a critical moment due to the negative impact that the pandemic is having on the tourism sector. However, what no one doubts is that once the vaccines are spread and confidence is restored, people will start travelling again. At this time, it is more important than ever to be steadfast to the company’s purpose and vision. It has been necessary to align the strategy to the new reality, and in our case we are committed to continue developing the product and offering the best technology with the best team of people, with the aim of helping hotel chains to incorporate greater automation and flexibility that will allow them to arrive as strengthened as possible in the new post-COVID era.

As I said at the beginning, we are living in difficult times, but I can only be proud of the journey we have been on, which of course does not end here. This past year has helped us to further strengthen our hospitality revenue strategy and continue to be the strategic partner that the hospitality industry needs now and in the years to come.

Thanks to all the customers and partners who have trusted us to make it possible to get this far and continue to grow year after year, we are still going stronger than ever!