ZIFFPAGE TITLEBy David F. Carr | Posted 2005-05-23 Print
Choice Hotels has made a tidy profit selling supplies to its franchisees. The next step: extending the b-to-b site to the outside world.Three Guys in a Garage'">
'Three Guys in a Garage'
ChoiceBuys.com was launched in 1999 on software provided by a dot-com era startupwhat Douglas refers to as "three guys in a garage in California"that caused frequent server crashes.
In 2000, Smith came in as part of a team of developers who reworked the application in Cold Fusion, a Web application programming language. When they ran into SQL Server database access problems with that version of the application, the developers started architecting the system with tools from Rational Software Corp., aiming to deploy on a Java application server on Unix. The custom development effort was meant to provide an exact fit for Choice's requirements, but the developers were struggling with basic issues of stability, performance and flexibility.
That's when Douglas decided it was time for a change. The development team was up to 14 or 15 contract programmers, and more would be required for years to come to maintain and enhance the system. "We realized we're not really a software company, we're a hotel services company," Douglas says. At this point, in 2001, he thought there must be a packaged software product Choice could tailor to meet its needs.
So Smith took the system architecture plans she had been working on and used them to draft a formal request for proposals. The winning response came from Comergent Software, a business-to-business e-commerce specialist, and the first version of ChoiceBuys on the Comergent platform was released in 2002. Most of the other 24 vendors Choice evaluated were procurement software vendors like PurchasePro.
"About 80% to 85% of what we thought were unique requirements, the Comergent platform had off the shelf," Douglas says. In particular, Comergent's software allowed Choice to set itself up as a market maker between suppliers and buyers, rather than focusing on a simpler retail model, he says.
But the match wasn't perfect. Comergent's business had grown up around supporting the relationships between manufacturers and resellers. The relationship between Choice and its franchisees wasn't quite the same. Where a manufacturer might require resellers to use a Web portal, Choice's franchisees had to be convinced they would save time, money or both with ChoiceBuys.com.
In retrospect, Comergent chief technology officer Bill York admits the Web site should have been more carefully tailored for the franchisee users.
"I don't think we [Comergent and Choice] had a good intuition for what those people needed," York says. The application was designed too much like an internal corporate procurement system, ignoring the fact that franchisees are not employees and not obligated to use the system, according to York.
In 2002, the year the Comergent- supported version of the purchasing portal launched, revenue for the Partner Services Division dipped slightly, from $12 million to $11.8 million. Choice commissioned a study by Catalyst Design Group to find out why usage of the portal had dropped.
Jon Mysel, a Catalyst co-founder, directed the study, based on interviewing the owners and staffs of five hotels about what they wanted from the system, looking over their shoulders while they used itand watching many of them become lost or frustrated.
Some problems stemmed from using too much of the boilerplate screen displays from the sample application Comergent had provided, rather than tailoring it to the audience. Users who had their expectations of e-commerce set by Amazon.com were confused by the way the system generated purchase orders. To them, it looked like they were being asked to steer multiple shopping carts through the online store.
So at Catalyst's prompting, Choice asked Comergent to display a simpler, single shopping cart view. Now the system divides up shopping cart purchases behind the scenes into purchase orders for multiple vendors.
Choice and Comergent had put a lot of effort into letting hotel owners compile lists of frequently ordered products and using previous orders to generate new ones. But those features had been overemphasized, Mysel says: "It got in the way of the standard tasks of browsing and searching."
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