myNext manage several hotels, hostels and apartments/boutique hotels across Austria. From properties in Vienna to Salzburg, their accommodations offer guests the opportunity to explore the unique city cultures as soon as they step outside the door.
But myNext is particular in that the organisation behind it is a non-profit. They work together with the non-profit organization ÖJAB - Österreichische Jungarbeiterbewegung - which provides them with the properties for all their hostels, hotels and apartments with all myNext earnings going to ÖJAB.
Furthermore, the ‘profit generating’ side of myNext is only seasonal and is open for transient business from July to October, while the rest of the year all accommodations are allocated on a longer term basis for language students.
With all the profits made in the summer having to go towards the running of the business for the rest of the year, things can be challenging from an operations point of view. We spoke to Manager George Gaag about how technology has helped them coming out of the pandemic and how ROI is a massive factor for such a unique business model.
Old school frustrations
“We started using Pace back in 2019. At the time, I was massively open to the idea that I shouldn’t do revenue management myself. In fact, I would catch myself not doing it at all as I simply didn’t have the time. We are Mews users and at that time Pace was relatively new on the RMS scene and had a great seamless integration with Mews. So we decided to try it out…
Back then we had three properties using Pace and we started off setting some prices but soon we just left it all to Pace as it was clearly doing a great job for us. I was particularly fond of the Pace support also, which is all done through Intercom and the team has always been there to help us.
We have six properties in total - five in Vienna and one in Salzburg - but were actually closed for almost three years because of the pandemic and only re-opened this year. This summer we decided to only open four of the properties. Furthermore, the hostel part of our business is substantially lower than it was in 2019 when we offered a lot of three or four bed dorm products. So we were nervous about how things would go and how Pace would perform in 2022…”
“Several months before we opened this year we had nothing on the books and it looked like we were going to have a terrible year. In the end, we shouldn’t have worried at all as pickup has become so short that you need to be calm and patient and have trust that an excellent system like Pace will capture opportunities for you. Things started picking up a few months before opening and we were close to full in July and August of 2022. Occupancy hit 93% and 94% in two Vienna properties and Salzburg hit 95 percent, which is super high as 2019 wasn’t even as good as this year.
We’re a seasonal business (July to October) and by virtue of only having Pace switched on 50% of the time between January and June this year, we were able to see the impact Pace was having on our ADR.
So on account of a mistake on our part by not switching Pace on, we were able to do a rough ‘proof of performance’ experiment. For our hotel type properties our ADR was 33% higher when Pace was working. For our apartment type properties our ADR was 20% higher.
In short, Pace is doing a great job and we now have to do zero revenue management apart from setting up the seasons once. The automated pricing has really boosted our ADR and RevPar. The ROI is so easy to justify, even though we are only open for transient business three to four months of the year, which goes to show how valuable the Pace platform is to us.