Reputation Management On-Line

Today IE hosted a workshop with RJ Friedlander, CEO of ReviewPRO, highly technological social media research company focused on reputation management in hospitality industry. According to their advertising leaflet, they cover more than 70 million reviews - in 8 languages – from thousands of sources, including 60 of the most important Online Travel Agencies. So how the product actually works? If you are a hotel, you choose in one of the three price plans with regular payments. What you get in return is a web based software resembling Google Analytics, but all about reviews of your hotel’s and your competitor’s services and in social media. The results are presented in the form of sophisticated graphs, where you see how your Global Review Index (GRI^TM) evolves over time and where you stand in comparison with your competitors. You can receive an alert when your GRI is deteriorating or a negative review has been recently posted. To handle the negative review, proportion of which is surprisingly small with 14.7% in average, ReviewPRO offers workflow that helps hotel’s management to investigate the issue and implement corrective measures. The software works in real time, hence is more effective than traditional mystery shopping, which captures only static picture of a given day. The greatest competition up today is Radian6, recently acquired by Salesforce.com. There are other products that focus vertically on hotels like ReviewAnalyst, but none of them has integrated that many sources and supports industry specific workflow.

Although, I am not entitled to share specific numbers, I can say that ReviewPRO has been very successful in past 18 months expecting to break even in summer 2011. I believe that key to the success are two obsessions RJ Friedlander suffers. First obsession is to develop the product to perfection. ReviewPRO had spent surprisingly large sum of money to make their product best in its class to get some head start with their competitors. Second obsession is related to clients. ReviewPRO sales force is persistent in hunting down clients constantly coming up with different proposals in case of refusal. The result is rapidly growing customer base with almost 0% churn rate.

The advantage of focusing vertically on hotel industry is two-fold. Firstly, hotel industry is globally very large and fragmented with a long tail. Although, in the USA, 70% of hotels are co-branded, in Europe it is the other way around. Hence, there is a place for 5-6 reputation management software, while all of them can get reasonable revenue volume. Additionally, there is a plenty of exit strategies incl. variety of potential acquirers. Secondly, hotels are critically dependent on their reputation and bookings are largely driven by recommendations. On top of that, performing semantic analysis of the reviews is far easier, when you restrict yourself to one industry or topic as you analyse less variations of words and their combinations.

Who would think about a business like that back in 2007? On-line booking changed the travel industry. Lets’ see how far the social aspect of choosing the products will go. In the meanwhile, companies will need social media monitoring tools to at least know what is going on with their brand.