Shiji is one of the world's most fascinating hospitality tech companies. In this interview Kevin King, its chief operating officer, explains the company's distinctive approach to the market.
Hundreds of the travel industry’s most technology-savvy executives will gather for our second Skift Tech Forum in San Francisco on June 27.
Skift Tech Forum, which will take place at the Fairmont San Francisco Hotel, explores key trends and disruptions that impact revenue and drive the e-commerce and technology strategies that power retailing, distribution, and merchandising decisions in travel. Expect insightful conversations from a broad range of speakers, including CEOs and top executives from Alaska Airlines, Amadeus, Expedia, Google, Uber, Marriott, Carnival, and Oracle.
Shiji is a little more than 20 years old. It began in China as a network solutions provider. Now the tech company has dozens of subsidiaries, including 20 foreign subsidiaries. For example, Shiji provides an array of operational software and services to more than 47,000 hotels outside of China.
The company’s growth sped up last year after a $486 million investment from e-commerce powerhouse Alibaba Group. In the past year Shiji acquired or took majority control of several companies, including StayNTouch, a hotel tech services provider, Concept Software Systems, a retail tech provider for golf, spa, and other activities, and IcePortal, an imagery management service for hotels.
Many Western brands use Shiji to help sell their inventory in the China market. Last year, the company overhauled its portal and rebranded it as Shiji Distribution Systems. Earlier this year Wyndham successfully launched its international properties on China’s largest online travel agency, Ctrip, by leveraging the portal.
Skift asked Kevin King, chief operating officer, about how Shiji stands out in Western markets, his advice to hoteliers, and how his company helps hotel companies distribute rooms in China. The interview follows below and has been edited for brevity. It’s a prelude to his appearance June 27 at the Skift Tech Forum in San Francisco.
Skift: Some large tech companies believe hotels want one-size-fits-all tech platforms. Is that Shiji’s vision, too?
Kevin King: There are several models that work for different types of companies.
Having a global platform with all services and solutions attached to the core platform is a great benefit for many companies as they have a single point of contact for big parts of their IT infrastructure. But that doesn’t work for everyone.
Many prefer a best-of-breed model partly because they have the resources to build in-house technology and partly because their needs are so specific that off-the-shelf solutions just don’t work for them.
Our view on this is that we want to build an open platform stack where each part can be used independently and work nicely with other solutions, including with competitors.
And if the customer wants to leave it at that, this is totally OK with us. If they want to use more of our solutions then that’s OK too.
Our core platform isn’t building a marketplace, but building an infrastructure platform that hotel companies can leverage to grow.
Skift: What about pricing?
King: There will of course be cost savings for a customer who chooses to use more from a single provider since they can negotiate better rates for the systems and the service level agreements.
We are very deliberate in that each system needs to have open APIs so that they are compatible with other systems, whether they be inside or outside of the Shiji network.
Rather than locking our customers in with a closed garden approach, we believe that giving our customers choice and control is the only way to ensure customer satisfaction and serve as a true partner, helping them to craft a robust technology stack that is suited for their business needs.
Skift: What can Shiji provide hotels that they might not get elsewhere?
At a practical level, service is key for us. For instance, our recent project in upgrading Starbucks’ point-of-sale system for over 3,000 outlets took a great deal of work on our end. It’s this level of commitment to support, security, and integrations that earn trust and loyalty.
But we have a broader vision too.
Imagine if the myriad of technological systems which run modern hotels could exchange data in a secure, error-free way. Imagine if users could pull actionable insights from their data in a company-wide dashboard, while also experiencing smoother interactions with third-party back office, sales, and support systems. That’s what Shiji provides.
We found that the average midsize hotel requires over a dozen different technological systems to run effectively.
Beginning with payments, to check-in and dining, to reputation management, and the many other experiences that make up the guest journey, Shiji connects its customers to their data, so that they can optimize their business and better connect with their guests.
Skift: Let’s talk about Western brands selling to the China market. What’s new with Shiji Distribution Solutions?
King: There are several aspects to this, the immediate benefit to hotels is to connect to the fastest growing outbound travel market.
More Chinese people will be traveling abroad in the coming years than any single market. So getting access to that market will be a very important step to growing revenue for any hotel company.
Then there’s the fact of having a distribution system that is connected to a very rapidly growing network of other Shiji systems such as payments, media asset distribution, and more.
Skift: What’s one of the biggest pain points you see in hotel tech?
King: I spoke about single guest profiles at last year’s CHAT [China Hotel and Tourism Forum] conference in China. This is a big problem today where guest data is scattered across multiple systems and very few hotel companies have a complete view of their guests.
It gets even more complex when you factor in privacy regulations. All of these pain points are being solved by the platforms we’re building.
Skift: What’s your overall message to hotel owners and operators?
King: More and more hotel companies are beginning to show a great deal of interest in innovation and keeping up with the times. My key message to everyone is to play the long game.
There is always risk in changing systems but try and assess where things will be in 10 years and start adapting now. Providers will try to make the change as smooth as possible but it requires some courage from both sides to really innovate.
Hotel tech systems include a central reservation system to manage reservations, a revenue management system to automate yield management, a customer relationship management system to handle guest preferences and profiles, a guest messaging service to manage reputation, a point-of-sale system to manage in-house dining, and a property management system that holds all the transactions.
These systems and integrations will get even more complex as emerging technologies such as voice activation, artificial intelligence, and the internet of things become more fully ingrained in the guest journey.
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Photo credit: Park Hyatt Paris-Vendôme is shown here. Hyatt has chosen Shiji Group's Infrasys Cloud service to power many of its food and beverage outlets. Park Hyatt