Yanolja evolving into global leisure platform
Kim Jong-yoon, chief business officer (CBO) of Yanolja, speaks during an interview with The Korea Times at the firm's office in Seoul, Sept. 6. / Courtesy of Yanolja
By Jun Ji-hye
Yanolja, a hotel and motel booking app operator, has been transforming itself into a global hotel and leisure mobile platform by forming business ties with global companies.
These include Rakuten LIFULL Stay, an affiliate of Japan's e-commerce giant Rakuten, according to a senior company executive.
Yanolja has also been seeking to move into Southeast Asia by investing $15 million in July in Singapore-based Zen Rooms, the budget hotel network startup founded by Rocket Internet.
The investment will enable the Korean company to fully acquire the Southeast Asian startup afterward as it retains the rights to buy 100 percent of the Zen Rooms business.
In a recent interview with The Korea Times, Kim Jong-yoon, chief business officer (CBO) of Yanolja, said the company will use this investment as a stepping-stone to plant its business model in Southeast Asia, and then expand its businesses to global hotel chains and system businesses as well as the leisure and activity market.
“We believe travel businesses are not for the domestic market but for export,” he said. “Yanolja cannot be a great company if it only stays in Korea.”
He chose Zen Rooms as the target for the undertaking as he is sure of the growth potential of the startup.
Since its establishment in 2015, Zen Rooms has shown an average annual growth rate of 185 percent and secured more than 6,000 rooms at budget hotels in five Southeast Asian countries _ Singapore, Indonesia, Malaysia, the Philippines and Thailand.
In 2017, the startup posted 1.5 billion won ($1.3 million) in sales and is expected to achieve 7.5 billion won in sales this year.
Zen Rooms fulfills reservations and sales activities through its own online platform, having a great possibility for development as an online travel agency, Kim said, noting that once Yanolja's business knowhow is integrated, its “R.E.S.T.” platform, which stands for refresh, entertain, stay and travel, will be established in Southeast Asia in a short period of time.
“I realized that the current Southeast Asian market is similar to what Korea was like five to 10 years ago. There are a lot of motels and budget hotels but most of them have yet to be digitized,” he said. “This was why I thought it would be great to take Yanolja's business model to Southeast Asia as we were the first in Korea to introduce app-based motel booking.”
The CBO stressed that Yanolja is aiming to export its business model rather than copying others.
“We hold a lot of patents and intellectual properties in preparation for exporting our business model,” he said. “We will work hard to set up small- and medium-sized budget hotel chains in Southeast Asia and offer cost-effective, personalized services to our customers so they can go anywhere they want and do whatever they want at reasonable prices.”
He noted processing real-time data is important to offer meaningful services to customers, adding that this has become especially important following the revision to the Labor Law that reduced the maximum workweek from 68 hours to 52 hours, which went into effect on July 1.
“People have more and more leisure time. This will change the way people travel,” he said. “Previously, people made long preparations before going on a trip and spent a lot of money. This will make it difficult for them to spend their increasing leisure time effectively.”
He said an increasing number of people are now looking for day trips, citing the recent trend among young people to seek a work-life balance.
“We need to satisfy those needs, and for this, effective management of real-time data is definitely necessary,” he said.
Real-time data processing is also important for the Fourth Industrial Revolution, in which many services will be activated by robots and artificial intelligence (AI) technology.
“Technology will enable customers to get their room keys as soon as they complete booking, and the time required for check-in will be significantly reduced,” he said. “We are already connected to many partners specializing in such technologies.”
At the end of August, Yanolja signed a business agreement with KT, the nation's second largest mobile carrier, to connect the telecom company's voice-recognition AI platform Giga Genie to Yanolja's room management system.
The Giga Genie-based infotainment system will be applied to Yanolja's hotel brands _ Heyy and H Avenue.
Under the agreement, the two companies are also co-developing services that connect Giga Genie to the internet of things (IoT) products.
Other than Japan and Southeast Asia, Yanolja plans to make inroads into other regions such as the Middle East and Africa, Kim noted.
“We are aiming to connect all accommodation around the world to our platform. We will not stop exploring more markets,” he said.
Yanolja began the mobile app service in April 2015. Since then, the app has achieved 10 million downloads from Google Play Store, on June 23, becoming the app used by one in five people here.
Having recently added the leisure and activities reservation service, the firm achieved 30 billion won in sales between July and August.
Kim said the firm's remarkable performance has been built on the trust of its customers.
“For the past three years, we have never sold any services at high prices,” he said. “Customers know that they can enjoy diverse services at reasonable prices through our app.”
Kim studied chemical engineering at Seoul National University and worked as an online sales and operation account manager at Google from 2007 to 2009. Then, he served as an engagement manager at McKinsey & Company from 2011 to 2015 until before joining Yanolja.