Travo Summit 2024: Traveltek’s mindset change towards product

Travo Summit 2024: Traveltek’s mindset change towards product

Its new approach has led to positive revenues

At the end of last month, cruise technology specialist Traveltek shared some of its key learnings from becoming a product-focused business at the Travolution European Summit.

The firm, who have been working on its new product since it launched in North America, last year, said it has had to change its mindset and approach to things on the way.

Stuart Cottrell, chief operating officer of the SaaS company, said: “If you bring the wrong mindset into the new age, you build products that are not right and it’s not just about the product you build, but it’s about how you build it as well.

“We’ve been investing in a new product to drive new growth and we’ve been trying to do that in a way that’s more akin to the product-based mindset,” as opposed to a project-based mindset. 

“Trying to change our mindset from this project-based delivery, this old-way of thinking of how we deliver software to the market.”

He went on to say that it has adopted not only a product-based mindset but a new mindset when it comes to strategising that product. 

There are two spectrums to product strategy, with deliberate strategy on one side and emergent strategy on the other, he said. 

The deliberate strategy is one that lots of companies have adopted in the past such as Ford and Procter and Gamble, to develop its product set. 

“That’s not really the approach taken by the tech giants that we saw have been dominating the stock market. 

“The likes of Amazon and Apple and all other tech companies aren’t restrained by this restrictive, deliberate strategy, this upfront thinking.

“They’re able to take an emergent approach. They understand that the market changes and the needs of consumers changes, and they also understand that they’re working in a complex system where actually their product can change market demand and need so they can shift the market themselves. 

“We’re tuned into what our product needs to do and working towards that.”

The third shift in mindset that it learnt from reinventing themselves as a business by focusing on product, was customer centricity. 

“It’s about how you put your customers at the centre of your thinking, and the centre of your operation.”

Customer centricity is not asking them one question and taking it at surface level he added, but really about the depth of the customer insight.

“Walking in your customer’s shoes, understanding their needs and their wants and their problems and how you’re able to solve them.”

A risk remains, when a customer asks for something your instinct is to give it to them, but he advised the 250-odd executives of the travel industry in attendance, not to do so.

“We recently deployed some new functionality that can help drive some efficiency in some of our customers,” he said.

“We had a customer come back to ask for a report on which agents had been using that functionality and which haven’t and when we drill into it, what we’re finding is the challenge there is they’re not getting quite the efficiency they wanted because not all agents are using it.  

“So, we could have said yes, given the report… but the real solution is to look at why certain agents aren’t using the feature. 

“Is it a training issue? Is it because it’s hard to use in some way? Is there some sort of error? Understand that and then you solve the problem.

“You give them the incentive and the means to use that solution so don’t give the customer the report, give them the solution that gets their agents booking in the way they want them to behave.”

Cottrell said flow has been the final lesson the cruise-technology specialist has taken from its shift to a product-focused business.  

Despite flow being an “abstract” thing and admitting that some people never really know what it is, he said: “If you think about a box and you have to get a piece of string from one side to the other, all you can do is pull from the right hand side of the box or push string in from the left hand side.

“The best way to get that string through is not to keep pushing in on the left-hand side. You’re going to end up with a big, tangled piece of string.

“The best thing is to pull it at the right-hand side and to make sure that the speed that it’s going in at on the left is matched to the speed it comes out on the right and that’s how you’re going to get the flow on the sting on the box.

Cottrell likened the left-hand side of string to work demand and the right-hand side of the string to the value output or software output, making sure it is as fast as it can be without flooding it.

“What you need to do is use that value to build a product which can then drive revenue, which can go exponentially, that’s not driven by the direct output of your engineering team.”

He added: “The sustainability of that flow model is really important.”

Traveltek concluded its presentation by stating that it’s very hard to measure the right thing.

“There’s a real fundamental challenge that there’s not a great and strong understanding of how to measure the effectiveness of software delivery.”

Things you can track are outputs rather than outcomes and a business should focus on the outcomes.

“Don’t care about how many lines of code your software engineers write, don’t even care so much about the number of hours they work.

“Care about whether they are giving the business results, whether they’re driving the value so they’re getting you revenue in, whether they’re keeping costs to the right level, whether what they work on is of high enough quality, and whether the customers are ultimately happy.

“Make sure you’re delivering value to your customers, that your product is delivering value. Everything will follow through from that.”

Results so far has seen the firm reach a recurring revenue rate of 93%, a net dollar retention rate of 120%, an ARR Growth rate of 42% and an average customer retention rate of 10 years.