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And I'm probably at odds with some hotel COOs and all that who go 110% on TAG. I'm going 90% on TAG. I mean, of course, I embrace a %, but I will never embrace tech at the loss of human interaction.
Speaker 2:From Hotel Tech Report, it's Hotel Tech Insider, a show about the future of hotels and the technology that powers them.
Speaker 3:Today, we speak with Peter Zilke, the COO of SafeStay Hostels. SafeStay operates 17 hostels throughout Europe and welcomes a wide range of guests, including backpackers, families, and business travelers. We talk about how SafeStay uses social media not only as a marketing channel, but also as a critical communication platform to chat with guests pre and post
Speaker 4:Peter, great to have you on the podcast. To get started, I would love to do a quick intro if you could tell me about your current role and a bit about your company.
Speaker 1:Sure. Look, I mean, first of all, thank you very much for inviting me to the podcast. It's great to be here and talking to you. Yeah, my name is Peter Silke. I'm the COO of SafeStay PLC.
Speaker 1:SafeStay PLC is a London based company. We are listed on the AIM market on the London Stock Exchange. And SafeStay operates a hostel and hotel brand called SafeStay. So SafeStay Hostels and Hotels, we operate 17 hostels and hotels across Europe in 15 major locations and over 10 countries from Greece to Scotland and from Portugal to Poland and anywhere in between. So it's a quite large variety what we do.
Speaker 1:Yeah, it's a typical hostel experience. We offer value travel for the backpackers, but also for the families and groups and more and more, well, more and more families, but also the business travelers. Because what we do as well is not the pure hostel experience. They're also private hotel type en suite bedrooms we have in all of our hostels. So quite a mixed offering from the accommodation side of things.
Speaker 4:Tell me a little bit about the guest experience. What makes your properties different than that stereotype that comes to mind?
Speaker 1:Look, mean, the stereotype you just mentioned, we have that as well occasionally. Let's not beat around the bush there. That happens. And that's fine as long as it's kind of enough. We are offering a fun environment.
Speaker 1:I mean, hostels is all about community, meeting fellow travelers, engaging with people, and finding and exploring new destinations. This is what safe stay is all about. Being able or that travelers are able to book at an affordable price, a clean, upmarket accommodation in a shared bedroom, you know, in a bunk bed with clean linen, which is changed every time a new customer arrives, of course, but also with great communal spaces. And I think touching on what you mentioned earlier, what makes the difference between hostels in the wider, the more generic hotel accommodation side of things. It's really just communal space to create the hostel vibe.
Speaker 1:And yes, of course, it's the college backpacker. Of course, it's the people who come only home at two in the morning and maybe had half a pint of beer too many. It happens, of course it does. But it's also the family with two kids and the parents, let's say, who book a four bedroom dorm, and in Central London, in the heart of Barcelona, or two minutes away from the Grand Place in Brussels, the accommodation element of that trip is a fraction for this family compared to two hotel rooms at a branded hotel in the same location. So that is really the fundamental difference what we offer.
Speaker 1:This community spirit, this kind of offering affordable accommodation to family groups, backpackers. And I see it more and more business people, travelers like myself sitting with their laptop in the communal space, and also enjoying to talk to other fellow travelers when we are not on our laptops and doing podcasts, for example. So it is a very refreshing new, not new, but a refreshing way of accommodation business. We really, really believe that.
Speaker 4:What's your average length of stay? Do you see people staying for weeks at a time?
Speaker 1:We see that, absolutely. Look, it's an important segment of our business. You know, the average length of stay hover around two nights if we take the average across the board. Of course, our core traveler is the backpacker, as we said this earlier. You know, the millennials, the Gen Zs of this world, you know, who do the tour from North to South Of Europe, 2 Days here, three days there, one night there.
Speaker 1:So there's our core customer, of course, together with groups, a school group from Spain exploring London for three, four days and all that. But it averaged out around two days we have there. So which comes actually to one point, if I may add on this, is the transaction value unit or the quantity of transaction checking in checking out and all that is quite high in hospitals compared to medium sized hotels.
Speaker 4:Tell me about how you use technology at your properties.
Speaker 1:Yeah look, I mean I guess we are always on the silver plate because our customer group is so tech savvy. They are usually a little bit younger than myself, and obviously grown up with the social medias of this world with kind of exposed to technology from their school days, and so on. So our customer, our core customer is very tech savvy. And we obviously need to supply the environment for them to interact with us. And we need to interact with them using tech.
Speaker 1:So it's absolutely important. But also to provide good Wi Fi, etc. So they can use their own tech, of course. So interaction between our customer and us, or us with the customer, you know, is massively important. Social media is a super important tech element to us.
Speaker 1:It's probably more seen as a little bit of a private add on and a marketing tool. And of course, it is for many companies, but it's a massively important part of our tech stack component, where we interact, communicate with our target group, with our customer, on scale with messages we want them to know, But also on a one to one, hey, I'm coming next week, how does that work? That happens on Instagram and then all the other areas. So social media is massive, massively important to us. But the core element, how we interact is, of course, our property management system, know.
Speaker 1:And that's not unique to host hostels. Hotels all have property management systems. But I mean, that this property management system allows the quantity of transactions in checkout. A 500 bet hostel is a high number of check ins and a high number of checkouts every day. Well, 500 at a maximum.
Speaker 1:So whilst a medium sized hotel, let's say 150 to 100 bets, the numbers of check-in checkouts are lower the same with bookings, etc. So the quantity of transactions is super super high and the super important element that the PMS, the property management system, can deliver. And the communication through that system, you know, that we can interact and communicate with them is very important to us. We switched over to a new property management system, well, only two months ago, actually. And that's the reason why I have a lot of grey hairs and all that.
Speaker 1:But look, it's always a challenging situation. But the provider we chosen, a company called Cloudbad, which is well known in the industry, absolutely fantastic. I mean, a transition of 17 properties in 10 different countries with 10 different or more legal requirements on reporting, on registration, on fiscal elements, taxation and etc, city tax and all that. So yeah, it was a challenge to transition 17 properties within a period of two weeks. So it wasn't easy and transferring all the data as well.
Speaker 1:But look, the team was fantastic. The team from SafeState, the project team really pulled out all the stops, and the team from Cloudbatch really added a lot of resources to it and made it happen, which is fantastic. And the reason why the Cloudbets has elements to it, it has one element which called whistle, for example, which allows us to communicate with the customer, you know, direct interaction messaging and all that. And in this day and age, you know, I mean, we have as a combined group, we have 4,000 beds. It's a high occupancy environment.
Speaker 1:So we last year, we finished with just around the 80% occupancy. You see the volume of the guests we have. We provided a million overnight stays last year. So to streamline the communication between the customer and us was the core element, which was the task and the final decision to go with Cloudbeds as a property management system. Because they have the platform using AI, using translations.
Speaker 1:If a guest from Asia comes and maybe doesn't speak Greek, although all our staff speak English, but if there is a barrier, elements like that are very, very important to us. And that reduces the time, the frustration for customers, but also for our staff. So tech plays a massive, massive important role in this customer satisfaction delivery. I really believe that.
Speaker 4:I wanna go back to what you mentioned about social media. I mean, I've probably done 50 of these interviews and I don't think anyone has mentioned social media as being considered part of their tech stack. So talk to me about how you use social. And do you have a vendor or an agency that's managing it for you? How does the logistics work there?
Speaker 1:I wouldn't say we use it in any super clever way differently than the individual social media channel intended it to be used. But we regarded as an important tech element in our business. And I think this in itself highlights the importance to all our team members. I touched on that we opened a commercial office in Warsaw A Couple Of Years ago. Our sales, our marketing, our HR, our revenue management systems all in one central hub, as we call it, based in Warsaw.
Speaker 1:So it's a lot of going forward and backwards between our two head offices in Warsaw and London, but it works fantastic. And there we have two people who do nothing but looking at social media, seeing trends, seeing that look, if competitors listen to that, we also look at the competitors, what do they do? You know, because that's market research. It's the best market research you can do. And I think to elevate the use of social media to the importance as, yeah, maybe as the yield management system price point I mentioned earlier, especially with our customer target group, sharpened everybody's mind to value social media, in particular Instagram, as one of their channels, you know, highly.
Speaker 1:And what do we see? People interact, they like to interact. I mean, again, it's the Gen Z, the millennials, this is the form of communication. It has its risks. I hear it loud and clear from parents like myself with a 18 year old daughter, you know, and I see that, but used in the correct way with the right guidelines.
Speaker 1:And the marketing team in Warsaw, they created these guidelines. They're using that. They interact with them. They're using tools like quizzes and giveaway quizzes and all that. So real strong interaction, you know, with our customer group, but also as a messaging platform, hey, look what we do.
Speaker 1:But this is probably a common tool many of you. I think what we really use it more than others is a communication, direct messaging, talking to each other or talking to individuals, etcetera, etcetera, really spending the time to talk to customer. The good old reception chat in hotels, the good old reception chat in hospitals, you can never replace that. I'm probably at odds with some hotel COOs and all that who go 110 on TAC. I'm going 90% on TAC.
Speaker 1:I mean, course, I embrace it 100%, but I will never embrace TAC at the loss of human interaction. I see it more and more that there are hotels out there, you don't have a human and they have their place. Hostels are not in that environment. So that's very very important to me that the human touch, the chat, the coffee, hey, let's have a what are you doing this evening? Let's have it be this communication, this chat is really, really important.
Speaker 1:But pre and post stay social media is great to have that
Speaker 3:chat
Speaker 1:as well. So it's a very important element of our tech stack %.
Speaker 4:Do you promote Instagram, for example, as a main communication channel, like pre stay when you send a confirmation email to your guests? Do you say like, have a question? DM us on Instagram. And then when a guest does message you, how do you connect that conversation back to a reservation ID? Or how do those connect?
Speaker 1:No, we don't, to be perfectly honest. We are not saying, look, you have to or this is. I think it's just an it was an evolution, it just happened. It's just a natural thing because of our customer group. This is the way you communicate.
Speaker 1:You know, I still pick up the phone, but there we go. So it's just a natural kind of thing. And people are quite happy. Look, I'm arriving tomorrow in Barcelona, in our hub in Warsaw, they have all that technology around them. They have access to all the data in every hospital across Europe, they are multilingual, you know.
Speaker 1:Of course, we're using the translation tools to make it easier to reply in the guest's language. So it is not integrated into our reservation system. It lives separately, but it was a natural evolution to use that more and more as a communication tool rather than email, even WhatsApp or even phone calls.
Speaker 4:You said Instagram is probably the main channel. What other platforms do you use?
Speaker 1:Obviously on the traditional ones like the Facebooks, you know, and LinkedIn for different purposes, from a corporate perspective. But Facebook as well, I mean, I don't want to come across in any shape or form that I box certain age groups into one social media channel and other age groups in another. I leave that for someone else to analyse. But of course, you know, the increase of customers' families as a customer group in our portfolio, somehow that is more associated with the Facebook side. So we see a higher communication, higher interaction from that side.
Speaker 1:I leave probably the corporate communication out a little bit, but LinkedIn is important. Of course, we use that as a platform to announce our annual results, which come out shortly in the next few weeks. So and it all looking fantastic. That's great. Of course, we want to shout about that and interact with our owners or shareholders, but also with the owners of our properties, which we have great relations with because they believe in hostels as well.
Speaker 1:They decide, well, look, here's the property, you manage it for us, you lease it from us, we believe in it, and all that. So it's a similar communication on the LinkedIn side, not on the quantity as on Instagram, but a similar communication way or communication tool or strategy. That's the word I was looking for communication strategy as we're using on the Instagram. So Instagram is by far the more, the most important communication tool with individuals. And I'm talking specifically about individuals, I'm not talking about the posts everybody sees, you know.
Speaker 1:I'm talking about behind the scenes, hey look, let's talk. And occasionally someone says, look, let's take the conversation offline, I email you. It happens, you know, and then we facilitate this as well. So there's far more in the background which you don't see by the fancy little clips we post, and the fancy little photos we post and all that. So there's far more communication in the background.
Speaker 1:And I find that super interesting and valuable for us. But if I may just pick up on social media can be a scary for many hotel or hostel operates, a scary element because people, dare I say it, they can say whatever they want, you know, and quite rightly so. We're living in a free countries and all that. But, and of course, we get criticism. Of course, we're getting through this technology channels and all that.
Speaker 1:But you have to deal with it in the right way. I mean, at the end of the day, it helps us. And we integrate that with another system we installed last year called TrustView, which pulls out TrustView, pulls out all guest reviews from Google reviews, from Booking.com reviews. It doesn't look into Instagram or from Goda reviews, Expedia reviews, brings it all together into one platform, analyzes it, you know, tell them, look, your customers are happy with your location, they're happy with your cleanliness, they're happy with your stuff. But they don't like the temperature in your room for whatever reason, and all that.
Speaker 1:So it gives us great insight really down to very detailed analytics, what the customer appreciates or doesn't appreciate, and we react on that. So Trust You is another kind of piece of tech we installed as part of our platform for growth. It was a little bit more around fifteen months ago since we have that in place. So this integration of bringing everything together is super, super important.
Speaker 4:One other topic I'm curious to get your thoughts on, how are you currently using AI or do you have plans to incorporate AI into your operation in the future?
Speaker 1:Yeah, look, AI, you know, everybody kind of says, oh, AI, this is it, you know, and all that. So, and of course, you need to you have to embrace it, but you have to embrace this in a sensible way. You know, of course, I get emails from suppliers and say, look, you chat boot and this and reply to customer reviews using AI and all that. To be honest, I'm not brave enough yet to switch that tool on. For example, customer reviews.
Speaker 1:I know hotel chains do it. Some do it. I don't I know some hostel chains do it. I want to have my general manager or the deputy general manager behind every response. And they looked at it, that they register the feedback we get.
Speaker 1:One day, if we increase our portfolio, etc, I might kind of need to go into, especially in the customer response area with AI a little bit more. But I'm yet to see a chat boot on AI which interacts with customers in a satisfactory way from a hospitality perspective. The human emotion is still something the robot will not be able to replace, and probably never replace. Saying that AI price point, going back to our price change or yield management system, it's AI based. It is AI based.
Speaker 1:They're using AI technology, internal communication. Again, another tech element, which a lot of hostels or hotels or other companies maybe not kind of focus too much. How do we interact with each other? Know, I mean, I have 17 hostels, as I said, you know, from Athens to Edinburgh, from Berlin to Madrid. So, I mean, I travel a lot, but you know, I can't see them all the time.
Speaker 1:How we interact and how we conduct meetings and using technology on that. And we are not particularly clever, but we're using it to an absolute maximum, the whole Microsoft platform, the Teams, the SharePoints, you name it. And yes, of course, in the background, we have AI note takers for every meeting. So these AI these reports are ready. So there's not someone after the meeting, oh, I type up the notes, I send them out in a minute.
Speaker 1:No, no, this is time you talk to customer whilst the AI do that. So I think we're using AI where I feel or where we feel comfortable with in a hospitality environment, and it will grow. Of course, there will be more and more applications and we will open up more and more to that. And we use it in the commercial element, we use it in the administrational side AI, and we will continue to use that absolutely. Between you and me, and I hear a lot of people who are listening to this podcast disagreeing with me, I'm not 100% convinced that it is right for the human interaction, for example, to responding to reviews.
Speaker 1:I'm yet to be convinced that that's the right thing. Because suddenly it becomes all automated. And I read only statistics. I want to read that Peter from London had a problem that his coffee was cold. And I don't want an AI to reply, sorry, next time it will be better.
Speaker 1:I want to know about that, about Peter. And I may want to pick up the phone to Peter and say, look, we got it wrong, you know, come back, picks coffees on me or something like that. So that's important. So AI has its place, absolutely, more and more. But I think it needs to be used wisely, especially in the hospitality environment.
Speaker 1:Don't overstretch it yet. If I'm a business traveler, I class myself as a business traveler, but I'm staying in our great hostels, and I love it. But as a business traveler, you want a quick check-in, you want a quick bite to eat, you may want a glass of wine or soda in the evening, and you want to go to bed. But this is only one element of our target group. We, hostels, are providing social spaces.
Speaker 1:This is what we do. You know, people not checking into a hospital to lay in their bed 20 fourseven and all that. They have a good night's sleep, they come to the lounge, to the roof terrace, which we have plenty of in many locations, or they go into the bar area. And they sit together and have a chat. If I may, Adrian, one short story.
Speaker 1:My career was corporate hospitality. I know nothing else up to recently. So I grew up in the Hilton world, the Marriott world. I worked in conference centers, and I loved it. Absolutely, there's nothing wrong with it.
Speaker 1:And I love to stay in great brands and all that. But when I started two years ago, is when I took over that role as COO at Safe Stay Hostels, first of all, my colleague in the hotels, I said, what's wrong with you? But I said, man, look, this is the fun side of hospitality. I'm going over there and it's great. And one situation is only one minute, it really sticks in my mind for probably forever.
Speaker 1:So my first trip to visit a hospital was Barcelona and our property at Passe De Gracia, staying in the middle of town opposite the Blendering Oriental. So I always said, look, here you have one for £20 a bet, over there you have one for 2,000, Your choice, same location. I got up at 07:30 into the breakfast room into the bar area. I was the only one because everybody was still asleep, which is not unusual in hospitals at 07:30. Sitting there, having a coffee on my own, of course, as you do open your laptop or looked at my telephone.
Speaker 1:And someone else came through the door, the second person in the whole room, tables empty, everything. And this, it was a young lady. So she came, sit on my table.
Speaker 3:I said, oh, is this table? She said,
Speaker 1:is the table for you?
Speaker 3:I said, yeah. Sure. Take a seat. I said, oh, what are
Speaker 1:you doing today? Where are you from? And I said, oh my god. Someone talks to me, you know, at breakfast, which is probably not happening in a corporate hotel. You know, someone talked to me unprompted and we had a great chat.
Speaker 1:So I said like, look, I just started as CEO at SafeStay, and I got fantastic insight, obviously, But you know, that was the eureka moment for me, you know. Oh my god, people talk to each other. And this is exactly what is hosteling all about. Talk to each other, meet fellow guests, learn about the destination, and be inspired where you travel. People crave for that, you know.
Speaker 1:We talked about Instagram and social media a long time. And of course, you can use your mobile phone to use as a key card. We installed that not too long as a test pilot up in our Edinburgh property and all that. We have all that. Of course, you can check-in online, you can bypass the reception and all that, absolutely.
Speaker 1:But hostile environment is this interaction. And this is something which is refreshing, which is fantastic in a tech dominated world that people still want to talk to each other. Tech is super important, and we embrace it 100%. We installed training online systems, Cloudbed AI driven rate management, you name it, we touched on some of them earlier, and we will continue to do so. But one thing we will never lose a safe stay is the hostling customer interaction and bringing people together.
Speaker 1:That is what hostels do, bringing people together.
Speaker 4:That's great. I think that's the perfect topic to end on. Thank you so much Peter for taking the time. Really great chatting with you. I'll open it up to you if you have any final thoughts or anything else you want to add.
Speaker 1:Tech is brought at full center of what we do or supports us what we do. And it will obviously never go away. If anything, it will increase in importance to us, of course. And our platform for growth has super high demands on the tech stack, which we installed and will install going forward. But repeating what I just said a minute ago, tech will never replace the human interaction and we should never lose sight of that.
Speaker 1:We need to use tech to bring us together and still have a beer or coffee together and have a chat when we travel and exchange information face to face. That's important.
Speaker 4:Well, thanks so much, Peter.
Speaker 1:Fantastic. Look, thank you so much for having me.
Speaker 4:Absolutely.
Speaker 2:That's all for today's episode. Thanks for listening to Hotel Tech Insider produced by hoteltechreport.com. Our goal with this podcast is to show you how the best in the business are leveraging technology to grow their properties and outperform the concept by using innovative digital tools and strategies. I encourage all our listeners to go try at least one of these strategies or tools that you learned from today's episode. Successful digital transformation is all about consistent small experiments over a long period of time, so don't wait until tomorrow to try something new.
Speaker 2:Do you know a hotelier who would be great to feature on this show, or do you think that your story would bring a lot of value to our audience? Reach out to me directly on LinkedIn by searching for Jordan Hollander. For more episodes like this, follow Hotel Tech Insider on all major streaming platforms like Spotify and Apple Music.