Back at the start of 2020, our first PillowTalk Media interview was with Graham Donoghue, CEO of Sykes Holiday Cottages. At what felt like a very different time – when the short-term rental industry and UK’s leading provider of self-catering accommodation was on a pathway to success which seemed untouchable – our discussion centred around ambition, progress and growth.
Fast forward 6 months, a global pandemic, subsequent lockdown ensuring no guests were travelling and a seismic change in working conditions, we wanted to find out how Graham has steadied his ship through the immense challenges of the last few months and what’s in store for the company now that domestic travel has once again surged.
PTM: Since we last spoke in January, so much has changed for everyone, in particular in the travel and tourism industries. Can you give us some insight into how the last three months have been for Sykes Holiday Cottages and what have been the biggest challenges facing you as a CEO during the lockdown period?
Graham Donoghue: It’s definitely been the most difficult period of my 25-year career. As a CEO it can be lonely, and you have to balance short term vs long term. We are an agent, and as an agent for owners we are contracted to market, provide a booking platform, collect payment, pass it on and service customer calls.
We are not a principle and therefore have no contract with guests. So, what I would do as a principle is different to what I legally have to do as an agent. This was difficult, firstly to try and explain to all, secondly, we have 17,500 UK homes across over 15,000 owners.
The coordination takes time and the legal position needed explaining. It’s something not everyone takes advice on during sign up. We didn’t just stick to our legal obligation as we wanted to do more to help change bookings and offer credits or refunds. To add to all this, every 21 days the position moved on and each devolved government across the UK took a different stance. Despite best efforts, clarity was missing from the government and lots of customers were angry and just wanted their money back and for most we just didn’t have it as we pay owners in advance, and again the contract is between the guest and the owner, with us acting as the agents.
At the same time, all our staff were working from home. We had call volume increases at 400%, were getting over 5000 emails a day and we had no idea how long this was going to last.
As a CEO you go into survival mode with your team. Your priority is to ensure everyone is safe and you model out scenarios and pick the worst one to work back from if things improve. I have seen some nasty behaviour during the last 16 weeks, lots of miss-information and the evil side of social media. But I have also seen some amazing behaviour from owners in support, understanding customers and a team who care.
PTM: With hindsight, is there anything you would have done differently in those first days/weeks as the pandemic and lockdown unfolded?
Graham Donoghue: I’ve thought about this a lot.
If I knew the income would have returned as quickly as it did with booking, then yes, we would have offered our fees all back as cash as this created a lot of disappointment. We have now done this from early June but back in March this would have helped customers. To be clear, legally we did not have to do anything as an agent, but if we didn’t, we would have lost faith with our owners.
PTM: Since Boris Johnson announced the re-opening of the UK’s hospitality industry on 4 July (there are slightly different dates for N. Ireland, Scotland and Wales) things have clearly and dramatically changed, at least for the short term. What booking activity and booking trends are you currently experiencing at Sykes?
Graham Donoghue: As soon as customers had clarity, volumes hit record levels. We were taking a booking every 10s and hit record volume days the week after the announcement. We are still trading very positively for the Summer, but stock is selling out and we have less to sell as some owners have blocked out periods, still not comfortable in taking guests. This is understandable.
We had 6000 bookings travel the week of the 4th July with thankfully very few issues.
PTM: Despite the challenges of the Covid-19 period, it has been for many a time to reboot, rebuild, reassess. What have been your biggest learnings since 23 March? Are there any key aspects of your strategy and/or operations that will now be fundamentally different as a direct result of the last 3 months?
Graham Donoghue: We were a very successful business going into the pandemic and we will be a very successful business moving forward. I have learned many things, mostly around behaviours. Our ability to act fast, focus on what is really important, provide a flexible working environment, virtual communication, develop at pace and the list goes on.
We are a growth business and we will continue to be inquisitive and seek out opportunities. I suspect new ones will emerge from the crisis.
PTM: There has been a great deal of emphasis within the media and within the short-term rental industry itself on raising standards and cleaning protocols. Firstly, in your current experience of renewed bookings, are you, in reality, seeing this as a sizable issue for guests? And secondly, how is Sykes ensuring that the safety of guests is paramount? Will you be doing anything differently in terms of how you run your operations and consequently how you communicate what you are doing?
Graham Donoghue: I have been very impressed by the efforts of our owners in adapting to enhanced cleaning standards as a result of the virus. We have issued several sets of guidance and also worked to provide more time during turnarounds. We have also provided guidance and actions in the event that a customer shows symptoms and as always, we monitor all feedback with particular attention to cleaning. We have also communicated with guests to ensure they understand not all facilities may be available and also to be supportive of local communities.
PTM: What’s your take on the issue of increased industry-wide standards? Has the need for the industry to work even more closely over regulation issues increased?
Graham Donoghue: I’m not a fan of regulation however sharing best practice and lessons learned is important. Some great standards have been created and are available to join. For a smaller agent, who lacks the operational rigour or scale as we have, it makes sense to piggyback.
PTM: The well being and the investment in your teams, as well as company culture, has been integral to your success. As with many businesses, the events of the last few months will have put huge strain on your workforce and internal dynamics. How have you managed during the lockdown in terms of internal resources, maintaining cohesion and motivation as well as adhering to your company values?
Graham Donoghue: It has been hard. At the beginning it was new and exciting for some to be remote and working from home. However, we do crave human interaction, and culture is created often in office environments over the watercooler. Thankfully, we had just improved our platform to accommodate cloud working for all applications and we had rolled out Office 365. So, with Microsoft Teams, Slack, Zoom and a few other applications we had a good start for working with remote communication.
I did a bi-weekly video to all. Our people team worked to provide support. We encourage the quiz nights, Friday drinks and all 1-1 and team meetings still took place, only virtually. Moving forwards, I can see us having a more flexible approach to home working, but I still think the culture is defined by environment and physical interaction. So, we will have a blend in the future.
PTM: What’s your view on the ‘recovery’ of the travel and hospitality industries within the UK and globally? Where do you see the short-term rental industry in the next 6, 12 and 24 months? What will have changed?
Graham Donoghue: I think the overall travel industry will take years to recover. For domestic, less so and the next few years could be the best ever. I just feel people will be less comfortable flying. Time will tell of course but I think urban short term will be hit hard.
PTM: What’s next for Sykes Holiday Cottages? Are you scaling back your growth plans or is it full steam ahead?
Graham Donoghue: We are still planning, with no plans to scale back. More opportunities will come our way as a result of the crisis we will have to be selective, but we are a growth business that can scale with high ambition.
PTM: Will it be a ‘staycation’ for you this year, or will you still dream of Bora, Bora! (this was in your last interview)
Graham Donoghue: Yes, we had four overseas trips booked and all cancelled. Wales is it for us… opens on 11 July…