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[Data&AI] Creating a Sustainable Value Chain for the Lodging Industry with Hotel Industry Expertise and Big Data Analysis T

Author
Facilitator
Date
2022-09-28 13:25
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129

Where can I get business information about hotels, motels, and pensions around? There is a company that has developed a "B2B platform" that can manage the business and investment risks of the lodging industry by online and offline.

Hotelysis, which is aiming to create a "sustainable value chain for the lodging industry" with its expertise in the global hotel industry and big data analysis technology, is the one.

Hotelysis is a B2B platform that can integrate and manage the business and investment risks of the lodging industry by online and offline, and diagnoses the business and investment risks of the lodging industry through the AI-based lodging industry business intelligence “HBI Dashboard". Also, through its lodging property workout platform, “Project AVE”, the productivity, efficiency, stability, and mobility of individual lodging properties are optimized.

Eun-Kwang Ham, CEO of Hotelysis, said, "in order to effectively handle the business and investment risks of the lodging industry, the value chain of the lodging industry should work properly," adding, "to this end, there must be a full visibility into the entire market, based on comprehensive data".

After graduating from Seoul National University's Department of Architecture and Cornell University’s Graduate School of Hotel Management, CEO Ham accumulated experience in the global hotel industry by conducting investment analysis and new projects at the InterContinental Hotel Group's U.S. branch. He also worked as the Head of Hotel Investment at Mirae Asset Global Investments, operating a KRW 3 trillion global hotel investment fund.

He explained that the economic life of a lodging property is usually 40 years, which is the useful life of real estate assets, but the average life cycle of lodging properties in Korea remains at 23.3 years, which is only 58% of the economic life.

He decided that a full visibility into the market should be the basis for creating and protecting a stable business environment in a dynamic market, and began developing "HBI dashboard".

CEO Ham said, "we started processing and analyzing data in September 2019. "I didn't think it would take long, but it took three years," he said. "there were trial-and-errors because lodging properties such as pensions and minbaks were not well caught in public statistics as there was no separate legal classification system for them".

CEO Ham, launched the service in July, based upon his judgment that the error rate of the HBI Dashboard fell below 5%.

The HBI Dashboard is the result of establishing a vast database of lodging businesses by providing long-term financial data of approximately 78% of 30,000 lodging properties in Korea. This includes a vast amount of time-series financial data for 17 years from 2005 to 2021 for all types of lodging properties, including hotels, motels, timeshares, and serviced-residences.

In particular, the financial data of closed lodging properties with business history in the past, as well as lodging properties currently in operation, are included, allowing to properly capture the dynamics of supply and demand by market. In addition, data on the size and mix of facilities are provided together, allowing to accurately capture the competitive environment by market and the positioning of individual lodging properties.

The biggest change in the interface of the HBI Dashboard, a B2B cloud software, is that the map interface is added to grasp the distribution of lodging properties by type and the status of competition at a glance. Through this, users can check information such as the location, the number of rooms, the type, the completion date, the opening date, the closing date, and the area by use of individual lodging properties, and check whether HBI Dashboard provides financial data for them.

"It is difficult for anyone who invests in lodging properties, lenders, and operators to establish a positioning strategy when starting a new business", he said. "I have thought that the Korean lodging market, which has a high proportion of motels, has plenty of opportunities, so I started this venture".

CEO Ham introduced that revenues, costs, and asset values can be estimated through the algorithm developed by Hotelysis. Since the lodging industry itself is a standardized business, it was possible to estimate the practice of the operation or the cost structure through the algorithm built upon the experience, and verify it with actual data.

Since most of the lodging properties are not publicly listed companies, Hotelysis purchased the corporate information from private corporate information providers, he said. "It is a process of tuning the algorithm itself rather than verifying the data".

CEO Ham confessed that there is still a long way to go to complete the platform itself. He also added that the decision-making process needs to be more efficient in doing so.

He said, "HBI Dashboard aims to solve the asymmetric problem of market information, but the misuse of data without data literacy can rather increase the problem", adding, "therefore, some barriers to entry into data are inevitable".

lgnumber@hitech.co.kr

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