This interview is part of our series “The Rise of the Chief Parking Data Officer” profiling parking industry innovators with the vision, strategy, and leadership to create connectivity within their organizations using data. Want to be featured? Send Sarah an email.
Hi there, Nate Phillips.
I always refer to you by your full name. Even to your face.
Good call. There are several parking Nates and even more regular Nates.
Nate Phillips, will you tell us what you do at SpotHero?
I’m on our executive team and mainly focus on our industry strategy. I work directly with our large enterprise operators, PARCS partners, and other tech companies in the space to analyze and optimize them to create better customer experiences for the driver-side of SpotHero’s business.
And before that you were an operator.
Yep. I’ve been with SpotHero for six years, and prior to that, I worked at Propark as an operator. I’ve been parking stuff one way or another for twenty-two years now.
We were colleagues when SpotHero IQ first launched. I remember that being a really exciting time because that’s around when the industry was rethinking how to set rates based on demand data.
The industry’s been on fire these past few years and data is now such a core part of everyone’s business strategy. If you’re an operator, it’s about how to utilize data to the outcomes of higher yield.
And if you’re a technology company, it’s about how to extract insights from the data you’re collecting through your applications or equipment to create a better customer experience.
That makes you a better partner to operators, because the outcome is higher yield.
THIS AIN’T NO SALES PITCH, Nate Phillips, but let’s talk about SpotHero IQ real quick so the folks reading this understand your expertise in the data sector.
Haha, OK – understood! SpotHero IQ is a dynamic rate engine.
We recently launched a new version with a more sophisticated algorithm for demand-based pricing, built by our in-house data science team. We’ve taken a big step up and are letting the science lead the way.
In the beginning, SpotHero IQ digested a ton of inputs and created base prices for different rate bands. This new iteration takes all of those inputs and puts it in a matrix so it can more precisely change a rate at any given time. It’s more visual, more specific.
What kind of data does SpotHero value the most?
One of the most important things, if not the most important thing, that we utilize is the demand data.
As we spend more time diving into and understanding the customer data, like how many people are searching, what they’re searching for, and how many convert, that’s phenomenal because it gives us insight into the decisions they’re making.
What we’re able to extract from this is how their habits affect revenue in a particular facility and in the microclimate. That transaction data, which we collect from our consumer platform, is really powerful.
Demand data for sure is powerful. Are you looking at occupancy data, as well?
Absolutely. We’ve been working more frequently with operators on parsing trends from occupancy data. That’s the type of data that reflects what they see going on in their physical spaces.
Between demand and occupancy data, what you’re unlocking is an understanding of what’s happening in the broader ecosystem of parking operations and how operators can be strategic and proactive with how they set rates, how they staff, what technologies they invest in, stuff like that.
We want to help them understand what it means that they’re seeing what they’re seeing in terms of trends, like what occupancy looks like throughout the day, so we can help them respond to that.
COVID-19 pretty much rewrote the book on occupancy patterns, huh?
Well, yes, but that isn’t to say that what we’re seeing right now isn’t predictable or plausible.
It’s just different. If you’re looking at the data, you can see occupancy patterns emerge based on what the world looks like right now with commuter recovery, events coming back, and travel picking up again.
So the question becomes, how has this changed how operators think about pricing and marketing to different customer segments?
Because we’ve got our fingers on the pulse of these occupancy trends and the shifts in demand, we can make really smart recommendations here.
Tell me a little more about pre- and post-pandemic parking trends.
Going into COVID-19, we saw garages that were always at 100% occupancy dip down to 5% occupancy due to the fact that people weren’t commuting or traveling.
Now coming out of the pandemic, we’re seeing a surge of demand in different cohorts than before, which we can see by looking at how many customers are looking for and buying parking at the 7,500 facilities that we serve up on the SpotHero app and website.
Where did demand come back first?
We actually saw demand for airport parking and event parking come back faster than commuter transient parking, which makes sense, when you think about it.
There are a lot of people who aren’t working five days a week, nine hours a day in an office anymore, so it’s not reasonable to expect the exact pre-pandemic patterns to re-emerge.
Commuter recovery has been one of SpotHero’s primary focuses over the past two years, so return-to-work trends are always something we have our eye on, and we share what we’re seeing happen in the market with our operator partners.
So, sharing data and observations on market trends results in a win-win for you and your operator partners?
In reality, it’s a win-win-win, with customers, operators and, of course, SpotHero all benefiting from a situation in which the parking operator understands what the customer wants, and when they want it, so they can provide the best experience.
To make this happen, we pay a lot of attention to the data that we get from our customers, from search and conversion data in the app all the way to customer reviews and feedback about their experience in the facility, so we can make data-backed recommendations to our partners.
Achieving that mutual understanding requires breaking down data silos. But many parking people still find the industry very fragmented. What are your thoughts on that?
Fragmentation has always been a huge problem. But what we’re all getting better about, I think, is de-siloing the data and learning from it.
Before COVID-19, there just weren’t a lot of ways of pulling data out of different systems, and very few operators were using business intelligence tools.
There were a couple who were paving the way for this, working with PARCS and really pioneering those integrations, but it hadn’t quite caught on yet in a widespread way.
Have the business and operational challenges caused by COVID-19 gotten the parking industry on the right track to de-siloing data, do you think?
Absolutely. With the onset of COVID-19, every company in every industry around the world had to figure out how to analyze their business while sitting at home.
From what I can see, operators are moving really fast in working with technology partners and adopting new technologies to aggregate their data and make it actionable.
We see what’s changed and we recognize that we don’t know what we don’t know. There are operators still operating in the pre-COVID-19 days with the mindset that business intelligence and analytics aren’t essential to succeeding in this new environment, and going forward forever, and that really surprises me.
Inadequate in-house sources for engineering and data science can feel like an impediment for making moves there, maybe.
Totally. I get that. I’ve been an operator, and from a strategic standpoint, it doesn’t always make sense to invest in building out your own robust data team.
But if that’s the case, you still really have to find a way to do it, because bare minimum you need someone in house who has some sort of insight into managing your technology partner relationships and ensuring that you’re getting the data that you need from somewhere.
You believe in the power of bringing someone in house, even if just temporarily?
I do. I think you need someone internal, someone who is living in the business day in and day out, who can help you lay that foundation. At least for an amount of time, maybe on a consultative basis.
That person can really dig in and learn how your business is structured and develop familiarity with the operations.
Operators are at many different levels of maturity with technology, so I think it does help to have someone in house to help you evaluate the landscape.
Yeah, I see what you’re saying. Enlisting someone in some capacity who can help demystify what all of the technologies in the market actually do and how they can benefit the business.
What I think can be very overwhelming for people who are diving into the process of evaluating technology partners for the first time, or the first time in a while, is that it’s hard to understand what types of companies are out there.
I still see this myself when I’m talking to potential strategic partners. If the pitch isn’t done really well, or if they don’t have transparent and clear B2B marketing, the messaging can get muddled.
It’s about understanding what the landscape looks like and what is at your disposal.
Right. So for example, in SpotHero’s space and in the arena of digital payments, you need to parse out who is doing B2C marketing, who is only doing payment processing, which specific types of payments each player can handle, and who out there is whitelabeling for payments, if that’s what you want.
Starting with an understanding of the different options out there will help you analyze your requirements.
How do you ask the right questions of potential technology partners to find out what makes them different from companies that appear to be doing the same thing?
I find it helpful to decide what I’m trying to accomplish before I start those conversations.
For example, if I want to get better at visualizing and understanding my data, I don’t talk to everyone out there who calls themselves a “data company”; I talk to business intelligence partners.
If I want to learn about digital payments, I see what’s out there and take note of what makes them different – like, hey, this is a small company laser-focused on digital payments and digital payments only, and on the other hand, here’s a big company that has twelve different things they’re working on, but because they’re big, they have more money and more muscle.
There’s no right or wrong answer but it helps me differentiate.
That’s a practical approach because you’re not wasting your time.
Yep. Every company has their own pitch: better uptime, more sophisticated operating system, whatever.
I can create matrices around that and it makes for an easy comparative process.
It’s like using the “compare” button on BestBuy’s website to make my own comparison chart before I drop money on something.
As a result, I can move pretty quickly from developing a high-level understanding of what a company has actually developed into taking a demo. Show me the consumer experience and show me the operator experience. That’s what I care about.
What do you think is the most important characteristic of a good partner?
Trust. Technology companies need to remember that trust and transparency are paramount. Operators can see through the BS, ten out of ten times.
For us at SpotHero, even if you think about the big stuff we’ve launched, we’ve always been candid and transparent about how well it works and are always eager to dig into it together with our operator partners to make optimizations.
This is something that I valued big time when I was an operator.
Nate Phillips, if you weren’t #parkingfamousTM, what would you be doing with your life?
I’d definitely be a touring musician. I would have taken that record deal fifteen years ago and crashed on couches ‘til we hit it big.
What’s your favorite parking jam? Like, a song about cars or parking?
“Park It Like It’s Hot”.
Hm. Sounds vaguely familiar.
It’s a cover.