Take a standard three-star hotel operating largely on tour operator exclusive agreements and reinvent it as a five-star beach resort and club, hosting the world’s leading DJs. This is what Palladium Hotel Group did when it created its Ushuaïa brand in Ibiza.
The Ushuaïa Club opened in 2011, followed shortly by the adjacent Ushuaïa Tower, offering a combined room count of 415. Occupying the middle ground is a pool deck and open air club, which has a capacity of 4,000 people, making it one of the biggest clubs in Ibiza.
But, to ensure success, Ushuaïa needed to undergo a digital conversion, as well as a physical one.
Alongside converting the asset, the senior management team at Palladium realised that it also needed to redefine the distribution strategy for the property. As a three-star tour operator led hotel the property had been achieving around €50 per person per night peak season. But as a five-star super-club it could achieve much more.
The Palladium revenue team worked to diversify the hotel’s distribution strategy, developing its eCommerce strategy, using online travel agents (OTAs) and pushing its direct channel. An integrated tech stack was integral to the transformation, with Duetto helping the team to optimise the hotel’s distribution strategy.
Sergio Zertuche, Chief Sales and Marketing Officer at Palladium Hotel Group, said, “Duetto helps us to optimize the distribution strategy, in order to give added value and drive the brand promise that we offer to the asset.”
*June – September 2019 vs. June – September 2018.
From €50 per person per night, the conversion and new distribution strategy saw rates increase by up to 10 times, with peak season rooms yielding at €500 per person per night. The growth continued, with August 2019 seeing RevPAR up 14% year on year, to achieve €645 while ADR jumped 4% to €712.
Changing out the distribution mix proved a real game changer, with the hotel moving from 90% tour operator distribution to 90% of its distribution now yielding through OTAs and its direct channels.
Eight years since its transformation, the revenue team continues to operate a dynamic distribution strategy, keeping channels open and yielding on price and packages to maximise on profits.
“Since we started with Duetto, we are more agile in taking decisions.”
“Since we started with Duetto, we are more agile in taking decisions, and these decisions are better decisions, because we have more data,” added Diego Fernández, Corporate Revenue Director at the Palladium Hotel Group.