Cross-Channel rail operator Eurostar is aiming to increase the number of customers that add a hotel on to a train seat by three times after creating its own in-house platform.
The move to curate a hotel collection in partnership with wholesaler Jac Travel and ending a long-standing affiliate relationship with Expedia is just the start of plans to push for more ancillary sales.
Roberto Abbondio, managing director of New Digital Business, who was part of the Expedia team that signed up Eurostar 12 year go, conceded it has stiff competition in hotel room distribution.
But he believes that not only are hotels looking for alternative forms of distribution and closer relationships with partners, but customers want the convenience of buying everything in one place.
“We are catering for different needs, not just taking people from A to B,” he said. “People’s main need is to organise and plan their trip and that, of course, is made up of different elements.
“Two third of people organise their transport first. We thought let’s seize the opportunity to keep people in our shop with something that’s relevant and engaging.
“We thought what does the customer need, so we said let’s ask them. What do they want and how do they expect to book?
“So we built our own platform. We decided to take the progressive step of building our own platform internally so it’s future proofed and we can tailor it for our own needs.”
Abbondio said Eurostar adopted a modern agile approach to developing the technology, coming up with a minimal viable product first and then iterating.
In parallel it went out to contract hotel stock with Jac Travel acting as its negotiating arm. At launch there were 300 hotels in the collection.
“Through consumer focus and research it came out that they like choice but probably too much is not a good thing,” said Abbondio.
“We thought what about if we put some efforts using data expertise from Jac and knowledge of our key cities to come up with a collection of hotels.
“Instead of offering a whole range of hotels, as we did with Expedia, let’s restrict it and we will select them based in past preferences of our customers.
“Hotels are looking to differentiate their distribution. Right now they feel they have to many eggs in one basket. This is a new channel for hotels and there’s lots of enthusiasm about it.”
Eurostar hopes to personally visit all the hotels it deals with so that it builds a relationship and it can offer better insight and content on each property generated by its own staff.
“One percent of our customers added a hotel to their booking last year. That’s where we see the big opportunity,” said Abbondio.
“We are hoping to see at least three times more, it could be even higher. We have quite ambitious plans.
“We know from our consumer focus groups around half of people who take Eurostar will need a hotel a some point in their journey. We do seven or eight million journeys in a year.”
Eurostar plans to broaden the ancillary product it offers to cover other related product streams like the activities and experiences people seek out when they are in destination.
“Ancillaries in travel is a key trend, we are all trying to do the same thing. Airlines have been trying a bit longer than Eurostar.
“The key this is to try to personalise the relationship with the customer. If you can be relevant it’s relatively easier.
“If you offer convenience and quality and a thoughtful approach people will use your website if they trust your brand to buy a wider range of product from you.
“In the end with a white label you end up with exactly the same product as everyone else in the market. Consumer are becoming more sophisticated.”