There are few hotels that wouldn’t prefer guests to book direct rather than choosing an online travel agency. But how do they feel about letting their guests bid for rooms and self determine the rates they pay?
This week we look at this alternative booking methods that are quietly taking shape across the travel industry, not just in hospitality. Earlier this month, Amadeus partnered with PlusGrade for airlines to make it easier for travelers to spend and bid on flight upgrades, for example. With hotels, rates are set by properties and, in most cases, they have the power to decide what those rates are.
They gain even more leverage when they allow bidding or room rate auctions for their properties, something that booking sites can’t gain the upper hand with as easily. These startups incentivize travelers to book direct by letting them bid for the best rates and feel like hotels have been more flexible and transparent with rates.
Bidroom is a hotel booking site that searches for the lowest available direct booking rates. It claims to save guests five percent on every booking and charges hotels a lower commission rate to make their rooms available on the site.
>>SkiftTake: While this is likely a better deal for hotels, there’s a reason why the major online travel agencies have done so well with the higher commission rates that they charge.
FindMyStay is a hotel bidding platform for India. It has about 2,000 hotels in more than 40 cities across India and claims to save guests an average of 30 percent on their bookings.
>>SkiftTake: Even as travelers are bidding for the price that they feel is best, they still want to know if they’re selling themselves too short. Comparing rates on popular booking sites is key to the user experience, which FindMyStay should make sure is part of its product.
Bid-A-Hotel is a B2B tool for hotels to help them locate overbooked hotel rooms. It functions as a bidding platform where overbooked hotels can notify other hotels in the area with available rooms. Those hotels can then bid on guests looking for stays.
>>SkiftTake: Hotel overbooking probably isn’t as common as airline overbooking, but this platform helps guests find the right place to stay in the event that something goes wrong. The catch–hotels that were overbooked potentially lose guests to other hotels for future stays too, depending on how much they enjoyed their stays.
OnlyBidding lets guests bid in auctions for the best room rates, and also lets travel agents make bids for their clients.
>>SkiftTake: Travel agents argue that they’re more than just a booking engine for their clients, that they’re advisors and destination experts. They’re also knowledgeable of what the best rates are in particular cities and a tool like OnlyBidding gives them more opportunities to highlight their advantages. Plus, some hotels have said they’re exclusively offering their best rates to travel agents anyways.
UpsellGuru provides hotels with software to enable guests to bid for room upgrades and book reservations for add-ons prior to their stay. This is done through email notifications that also inform guests of what is going on at the hotel during their stays.
>>SkiftTake: Finding the right way to communicate with guests before check-in is something hotels constantly experiment with. Sure guests will love the bidding process to get the lowest price for a room upgrade, but will hotels be as keen on that? UpsellGuru will have a harder case working with hotels than the consumer if it can build a fan base.
For all of our SkiftSeedlings collection, check out our archives here.