Singapore Changi Airport's upcoming Terminal 4 looks amazing!

If you live in Singapore and have ever ventured abroad, then you must know the welcoming and soothing feeling of returning to Changi airport.  Maybe it's the lush green foliage throughout the terminals or perhaps the speedy immigration arrivals process that puts me at ease.  It's no wonder Changi airport has won a slew of international awards, including the prestigious Skytrax World's Best Airport 2013.

As if things couldn't get better, Changi will be getting a 4th terminal in 2017.  According to the official webpage for the new T4 terminal . . .

Scheduled for completion in 2017, Terminal 4 will come with design and process innovations to redefine passengers' travel experience, raise operational efficiency and manpower productivity for airlines and airport agencies. It will also be vibrant and positively surprising, with touches of Singapore culture.

This is typical Singapore corporate speak.  When translated, it basically there's going to be a lot of automated processes that will zip travelers through the airport so they can spend more time (and money) at all the fancy new designer shops that will overtake the terminal.

These automated processes include the FAST intiatives (Fast And Seamless Travel).  For the very first time, Changi will launch self-service automation for check-in, bag drop, immigration, and boarding gates.

Although it's just turning 2014, I'm already looking forward to 2017 when I can arrive at Changi's T4 departure hall just 30 minutes before my scheduled departure time.  And to think some people feel my current practice of arriving 45 minutes before departure is cutting it too close.  :-)

Because migrating birds also deserve a unique Airbnb home after a long journey

Airbnb has done some pretty rad marketing in recent past.  Remember the short film Hollywood & Vines that was made entirely from six-second Vine clips?  What about the home made Obama O's that two of the founders created to raise money for their fledgling venture?

Well now Airbnb is all grown up with its first integrated advertising campaign called Birdbnb, which uses a metaphor of migrating birds and birdhouses for travelers and our desire to feel at home whenever we're on the road.

Watch this awesome video here.

But these aren't just ordinary birdhouses.  They're 50 unique bird-sized spaces inspired by real life Airbnb listings from all over the world.  Although they're beautifully constructed by professional artists, the real beauty shines when each of the migrating birds finds a home and starts exploring the cozy living quarters . . . even treating themselves to popcorn while perched on the TV couch!

I couldn't imagine a traditional lodging e-commerce site like Expedia creating an advertisement such as this one.  It really highlights the strong value Airbnb places on creating unique travel experiences through its hundreds of thousands of unique spaces around the world.

I think I can safely speak for the birds when I say, "How could you not love this company!?"

Will Pinterest's new "Place Pins" maps feature get hotel brands more serious about using the site?

In a not-so-surprising announcement last week, Pinterest launched a new feature called "Place Pins" that is devoted to travel inspiration and planning.  It's designed to combine the beautiful imagery one would find while browsing travel magazines/blogs with the functionality of a map and location details.  Best of all, users can share their Place Pins and collaborate on trip planning together.  On the down side, the map locations are powered by Foursquare, which anyone living outside the US will know results in major gaps in location info.

Given the popularity of pinning travel destinations on Pinterest, it wasn't a real shocker that the company finally launched a formal product built around travel.  The company disclosed that last year it had identified a significant trend of users creating boards just for destinations.

But what is really surprising to me is how few hotel companies, travel agents, and tour operators have embraced Pinterest as a way to inspire travelers through the use of imagery.  It's only fitting that a visual site like Pinterest would be a super valuable tool for travel companies to build up strong brand associations and awareness . . . especially the upmarket brands that seek to promote an aspirational travel lifestyle.  Pinterest has a massive user base that's just begging to be inspired, as evidenced by over 750 million destination pins to date all over the world.  Although Pinterest falls short of helping inspired customers book their travels (for now), there's still enormous value in hotel or travel brands engaging with would-be travelers on the site and possibly moving them closer to their respective purchase funnel.

In fact of all the global hotel chains, the only one with a strong presence on Pinterest is Four Seasons.  If the number of pins and followers is used as the comparative metric for engagement, then Four Seasons just absolutely blows away its hotel peers on Pinterest.  The company has a strong suite of pinboards but also was the first of its peers to create a Place Pins board.  Surely there are other upscale/luxury brands in the market that could learn a thing or two from Four Seasons' approach to inspiring travelers through imagery.

Below is a quick and dirty list of global hotel chains and their number of pins and followers.  Just for kicks and giggles I added Airbnb's stats.  They have just about the same number of pins as Intercontinental Hotels IHG Rewards Club, but with 33x the number of fanatic followers!!!

Four Seasons - 3251 pins and 24117 followers
Hilton HHonors - 1646 pins and 1357 followers
Hyatt Hotels - 1318 pins and 722 follower
Marriott Resorts - 902 pins and 1184 followers
IHG Rewards Club - 670 pins and 483 followers
Starwood Preferred Guest - 296 pins and 1330 followers
Hilton Worldwide - 224 pins and 1566 followers
Airbnb - 552 pins and 15876 followers
Intercontinental Hotels - no centralized pinners

I'd like to give a shout out to Airbnb's Place Pins board called "Loved by San Franciscans."  SF is easily my favorite city I've ever lived in, and this board is a nice walk down memory lane (complete with map and all)!

Airbnb's redesigned app empowers micro-hoteliers to deliver personality driven hospitality

"We are a hospitality company." - Brian Chesky, CEO Airbnb

On November 12, Airbnb hosted their first ever Airbnb Open event and made some exciting new announcements targeted primarily at their host community.  Although birthday wishes for yours truly weren't among them, the big news was the launch of a revamped mobile app.  Also making headlines was a suite of new programs aimed at improving the host experience and consequently the hospitality that Airbnb relies on its 350,000 hosts to deliver.

In the atrium of Airbnb's beautifully designed new headquarters, Brian Chesky illustrated his company's roots and then introduced the revamped mobile app with an electrifying passion and contagious enthusiasm that I have now come to expect during his talks.  While the improved app now seduces accommodation seekers ever more with inviting imagery and a cleaned up user interface, the real magic is in the mobile app's new host-facing user experience called Host Home.  For once, it's the suppliers who get the cool tools!

The company blog says it best . . .

"Hosting should be easy and enjoyable. That’s the premise behind our new Host Home. Think of Host Home as your hosting mentor—always there when you need it. Host Home provides you the right information at the right moment, from coaching you through listing a space to allowing you to effortlessly manage multiple bookings. Hosting on Airbnb has never been such a snap."

This is a unique approach compared to other travel and hospitality companies whose mobile apps focus almost exclusively on the consumer. But unlike companies such as Marriott, who have standard operating policies for their hotel staff, Airbnb is at the mercy of its hosts to deliver hospitality.  Many are first time hosts and could possibly look to Host Home as a "hosting for dummies" of sorts. 

If you think about the Airbnb customer experience from search to post-stay, the company's biggest challenge is the guest's arrival and the hospitality they experience during their stay.  These are the ultimate moments of truth, and unfortunately these critical moments that can make or break a customer experience are out of the direct control of Airbnb.  So to the extent that the company can creatively educate and empower hosts on hospitality standards, the better the chances for improved guest experiences.

So it comes with little surprise that the new Airbnb app seeks to influence host behavior and ultimately create a more consistent hospitality experience -- from basic comfort needs all the way to anticipatory service that creates a truly memorable trip.  Host Home provides hosts with best practices on delivering hospitality at the critical moments of a guest's travel experience.  The mentorship comes straight from the legendary Chip Conley, the company's new Head of Hospitality, and is aligned with improving the guest experience at each of the nine moments of truth he and his hospitality team have identified.  

But don't be fooled into thinking that the nine hospitality standards will make for cookie cutter experiences.  There is probably no better guru than Chip Conley to coach Airbnb hosts (or anyone for that matter) on providing authentic hospitality by embracing their unique personalities.  

In addition to announcing the revamped mobile app, Airbnb also announced the follow new features and releases:

Airbnb Stories: A new content marketing platform, Airbnb Stories is a collection of just that . . . inspiring stories that have emerged as a result of hosts opening up their homes to guests and letting their paths cross. 

SuperHost Alliance: Airbnb said it will relaunch its SuperHost program in 2014. The company describes the SuperHost Alliance as "a league of extraordinary Airbnb hosts" whose listings reflect their special status with a badge.

Host Rewards: Also beginning in 2014, Airbnb will run a rewards program for hosts, giving them travel credits, perks, and other privileges.

Host Groups: Debuting in beta in June and formally launching Tuesday, Host Groups now have more than 10,000 participants in more than 300 groups.  Groups allow hosts to leverage their collective knowledge to help each other improve their hosting capabilities.

Hospitality Lab: Chip Conley gave a peek at the inner workings of Airbnb's Hospitality Lab in Dublin, outlining standards hosts should follow in booking (to build trust), preparation (to make a good first impression), and arrival (interactions with guests).

At last, Priceline edges out Expedia in gross bookings and becomes the new king of online travel

Although Expedia's global websites don't yet admit defeat, Priceline has in fact surpassed Expedia in gross bookings to become "the world's largest online travel company" -- a claim Expedia has long marketed to customers and suppliers on its global websites.

In the past several days, Priceline has simply dominated the news headlines.  First came their Q3 earnings release, highlighting yet another consistently strong quarter underscored by increased market share.  Second was the public announcement that the venerable Priceline CEO, Jeffery Boyd, would step down as CEO but remain as Chairman of the Priceline board.  

(Here are seven of the biggest impacts Jeffery Boyd made on the online travel industry.)

Some news writers reacted with shock to the news surrounding Jeffery Boyd, yet the industry insider PhoCusWright suggested the leadership change had been in the works for some time.  But what actually shocked me most was the headline on Priceline overtaking Expedia in gross bookings for the first time in history.  Wow!

And when reflecting on the evolution of Priceline over the past decade, PhoCusWright was equally as surprised.  In a well written article by Douglas Quinby of PCW that portrays Priceline's come from behind surprise win . . .

The year was 2002. Once an Internet princeling, the online brand synonymous with "name your own price" had fallen out of favor. Moves into mortgages, groceries and gas proved misguided. Its share price had plummeted. In online travel, the company was effectively the fourth horse in what was quickly becoming a three-horse race among the leading online travel agencies. It was considered likely to get acquired or – worse – fizzle out.

When Jeff Boyd assumed the role of CEO in November of that year, the odds were against a resurgent Priceline. Iconic commercials starring the famed former captain of Star Trek notwithstanding, few would have expected over the next decade that the company would, on pretty much every metric that matters, become the global leader in online travel. Looking back, that was certainly one surprise.

I had a hunch that one day Priceline would surpass Expedia in gross bookings, yet upon reading this headline my jaw still managed to drop to the floor.  It was as though a consecutive Olympic gold medalist had been knocked off the top platform by an arch nemesis.  Congratulations, Priceline.

Now that Priceline has done the previously unthinkable, Jeffery Boyd will pass on the reins of CEO to his successor, Darren Huston.  And as Mr. Boyd dusts off his shoulders, he'll be watching Expedia admit defeat (at least temporarily) and remove its tagline, "The World's Largest Online Travel Company" from its global websites.

Virgin America has the coolest in-flight safety video that you just gotta watch

Back in 2007, I was one of the first passengers on Virgin America's inaugural LAX/SFO flight.  This new airline was hip and cool, and did for the airline industry what W Hotels did for the bland hotel industry.  I mean seriously . . . the airplane cabin had purple and blue lighting!  More than five years later, there's still not one airline that creates such a uniquely cool customer experience (especially in economy class).

Now Virgin America has further underscored its title as the coolest airline in the world with its newest in-flight safety video.  It's quite possibly the most entertaining video of it's kind, but one has to wonder if the actual safety messages get muted from all the belching high notes.  I suppose if it at least gets travelers' attention, it's already more effective than the boring in-flight safety videos that most people tune out.

Recently TheDesignAir website ranked Virgin America second in the world's best economy class airline cabin.  The airline's soothing blue and purple cabin mood lights weren't as impressive as Air New Zealand's "SkyCouch" seating configuration, which shot the Kiwi carrier to first place.

One thing's for sure though, Virgin America's new in-flight safety video is as much about safety as it is about generating some viral marketing buzz for the coolest airline brand in the world.

While Airbnb inks petition signatures, HomeAway inks landmark business deals

I find it interesting that the two biggest names in online vacation rentals, Airbnb and HomeAway, exhibit such stark contrast when it comes to their respective press headlines.  Although Airbnb focuses more on peer to peer shared accommodations, both companies are in no short supply of whole unit rentals which people like you and I can book on their sites.  Yet Airbnb seems to be under intense legal scrutiny while HomeAway flies more or less under the radar.

Airbnb has taken big hits in New York recently, having been subpoenaed by New York's Attorney General to provide personal data for up to 225,000 of its New York hosts.  Airbnb has publicly expressed that the request is unreasonably broad and that the company will fight it with everything they've got.

And so the fight continues in New York, and Airbnb has armed itself with artillery.  On the lighter side, a Save Airbnb in New York petition has drummed up over 70,000 signatures and far exceeded the original goal of 20,000 signatures.  Did you know this petition was started by one of the company's users?  It's impressive to see such die hard fanatics the Airbnb brand/experience has cultivated.  In full disclosure I'm also one of them!

For the heavier artillery, Airbnb has released an economic study that shows it generated $632 million in economic activity in New York City in just one year, and that 82% of all listings were in neighborhoods outside the traditional tourist zones in Midtown.  Surprisingly 87% of Airbnb hosts rent out the home they live in and earn on average $7,530 per year.  Critics argue that Airbnb's contributions are just a drop in the ocean when put into the context of overall New York City tourism receipts, but for such a young travel company to impact outlier neighborhoods the way it has in New York and other major international cities is down right unprecedented.

So while Airbnb was caught up in a defensive web of legal issues, petitions, and lobbying, what was HomeAway up to in the last week?  There was no sign of HomeAway draining valuable resources on legal battles.  Instead they were gettin down to business with launching a new commission-based business model and inking a landmark distribution deal with Expedia which should significantly boost the demand profile for their vacation rental product starting in 2014.

But interestingly this vacation rental product isn't so different from the type of product that Airbnb is coming under fire for in New York.  The legislation that should apply equally to both companies is the ban on short term stays of less than 30 days when the owner or leaseholder is not present.   But a quick search on HomeAway properties in Manhattan shows over 1,000 whole unit listings available.  Many of these only require a three night minimum stay if any.

This is certainly just speculation, but it's possible that HomeAway and other vacation rental sites may be cooperating with government requests for submitting user data.  If that's the case, and again this is just speculation, then I believe all the more reason to admire Airbnb for putting up a public fight in New York to protect user privacy and not taking the easy way out like some of these other tech companies.

What TripAdvisor can teach independent hotels about shifting share from OTAs

A big score for independent hotels (and of course TripAdvisor)

There's certainly no shortage of activity coming from TripAdvisor.  The company recently shifted some focus to metasearch, redesigned its site, acquired content-rich Oyster.com, and launched the independent hotels' newest best friend . . . TripConnect.

TripConnect is a new service that empowers indie hotels like never before when it comes to online marketing and driving direct sales and bypassing OTAs.  These smaller properties can now integrate their web booking engine to TripAdvisor's metasearch, and thus display live rates and availabilities for shoppers who perform a dated search.  By combining the hotel's presence on TripAdvisor metasearch with the right room pricing and bidding strategies, the savvy indie hotel operator can take the first series of steps in winning back channel share from OTAs.  And as OTA click through and conversion rates decline for a particular hotel, they just might scale back their own bidding and thus reduce marketing costs for the indie operator in the long term.

But what about Google?  For those indie hotel operators that have AdWords campaigns running already, should they be plugging into TripConnect and shifting marketing spend to TripAdvisor?  In general it's a wise approach to diversify and spend on both Google and TripAdvisor.  After all, TripAdvisor is one hell of a strong brand, but there are areas in the world where their name is virtually unknown.  So answering this question in detail really depends on the hotel product, destination, and its primary source markets.

But one thing is for sure.  Because TripAdvisor's metasearch allows for dated searches and the new TripConnect service plugs directly into indie hotels' booking engines, there is no wasted ad spend on dates that are unavailable because it wouldn't be possible for the shopper to click through in the first place.

Furthermore, TripAdvisor creates a smoother shopping experience (from research to price shopping) which should ultimately lead to a more highly qualified customer.  In the e-commerce world of performance marketing, that usually translates into much better conversions.

TripConnect offers a number of other added benefits, but at the end of the day it all boils down to one thing.  Independent hotels now have the most powerful tool to help them claw back bookings from high cost OTA distribution channels.  The fact that it's more effective than Google AdWords or Hotel Finder is just icing on the cake.

Google.  It's your move now.

Example of TripConnect in action.  Although in this case HotelClub's lower price is undermining the hotel's efforts.

Airbnb versus New York City. The saga continues over a subpoena for data on NYC hosts.

NYC still has 1000+ listings for entire apartments

There's been no shortage of drama between Airbnb and New York City regarding the legality of short term rentals.

It all started with a man named Nigel Warren, a New York resident who was fined $2,400 for renting out a room in his apartment on Airbnb.  Late last month, a New York judge reversed the fines in a victory for Nigel and Airbnb who had appealed the earlier decision.  It turns out that it's actually not illegal to rent out a room as long as someone is physically present in the apartment at the same time the guest is staying over.  Airbnb dodged a bullet on a technicality, although many more are likely to be shot over the plethora of vacant apartments that are rented out by landlords or property managers.

And then there's the hotel industry blowing the whistle on Airbnb hosts because they don't pay the city occupancy taxes that hotels are required to pay.  Airbnb's CEO, Brian Chesky, has for the first time acknowledged that most hosts should have to pay some sort of occupancy tax.  Could this be a peace offering move to prevent any possibility of widespread removal of all host listings?  It's important to note that what happens in New York City will likely create a new paradigm for other cities, with reports that San Francisco has also reached an agreement with Airbnb that would require hosts to pay occupancy taxes.

And with that, it didn't take long for New York Attorney General, Eric Schneiderman, to demand user data for 225,000 New Yorkers who have previously listed a room on Airbnb.  The data is being subpoenaed as part of an investigation into people who had possibly violated the law by renting out their room without being physically present.  If Airbnb does provide New York's AG with this info, we can reasonably assume that hundreds of Airbnb hosts would be served up fines or have to pay taxes retroactively.  A quick search on Airbnb's listings in New York City show that there are more than 1,000 listings even after filtering for "entire place" units only.  In theory, the vast majority of these "entire place" units are rented out illegally.

It should almost go without saying that Airbnb will not comply in an effort to protect the privacy of its community and user data.  As written on the company blog, "this demand is unreasonably broad and we will fight it with everything we've got."

The blog goes on to say, "As these conversations continue, we will always be committed to protecting our hosts' privacy and we will always stand by the hosts who are the heart and soul of this community."

Now that is an awesome company sticking up for the privacy rights of its users!  I just hope that Airbnb holds true to their battle cry, even if legal pressures begin to mount against the company to hand over its user data.

Booking.com takes over hotel bookings on New York tourism website

Powered by Booking.com

The arch nemesis of Expedia is making new friends in the USA, and one of them happens to be none other than New York City.  Booking.com has kicked off an affiliate partnership deal with nycgo.com, the city's official tourism website, to power hotel bookings in New York.

American OTAs must be feeling the sting as the Amsterdam based Booking.com increasingly stomps deeper into American home turf.  Priceline group is already on top of the leader boards in Asia and Europe, according to PhoCusWright.

It appears the NYC site was previously powered by Travelocity, and I suspect that part of the decision to switch to Booking.com was the number of localized sites it has around the world.  Currently Booking.com supports over 40 languages.  This potentially allows NYC to tap into large international markets that are more likely to visit the tourism site compared to domestic travelers already familiar with NYC.

New York is one of the most popular tourism destinations in the United States, and this new partnership may be the tipping point for additional American tourism organizations to partner with Booking.com and appeal to a more international audience.  A quick search also shows San Francisco's tourism site being powered by Booking.com.

From a supply perspective, Booking.com offers 573 properties while Expedia and Orbitz have 508 and 447 properties respectively.

Priceline jumps on the sponsored listings bandwagon and lets hotels advertise on search results

Priceline's new sponsored listings program for hotels looks pretty darn familiar.  Why?  Competitor OTAs like Expedia, Orbitz, and Travelocity have all featured pretty much the same product on their own search results pages for several years.  Just like display ads, the sponsored listings are also a complementary revenue stream to traditional OTA margins on the materialized bookings.

The sponsored listings are all auction based, pay per click campaigns that shoot hotels all the way up to the highly desired numero uno position in the search results of a particular destination.  In instances when there are pages upon pages of cookie cutter search results, it's easy for hotels buried deep into the dog pile to ascend to the top and gain maximum marketing exposure.  These sponsored hotels will get to sit in the spotlight with more or less free advertising unless someone clicks on their listing.

Since Priceline just launched their sponsored listings program last week, I would advise hotels interested in pay per click advertising to sign up ASAP and target their future lean occupancy dates.  The early adopters will enjoy low cost per click because there will be less competition bidding up the prices in the auction.  But winning isn't everything.  To improve the performance of their campaign, hotels absolutely need to ensure their rates are ultra competitive with the market and their inventory is well stocked to maximize conversion and ultimately the campaign's ROI.



As a consumer you can spot the hotels with sponsored listings because of their faded background color and typically the words "sponsored listing" near the hotel name.  In the example below of Expedia's search results for Bali, the Viceroy Bali is visibly designated as a sponsored listing and commands the #2 ranking after Mantra Nusa Dua (which is part of the Daily Deals merchandizing that trumps even sponsored listings).  Let's face it, getting to #2 in the rankings isn't too shabby when there's a whopping 874 other hotels listed beneath.

Hotel Quickly's last minute mobile rates not so exclusive

Hotel Quickly is the Hotel Tonight ripoff here in Asia.  Both have super sexy UX and pride themselves on fantastic deals at the last minute.  Every day at 12 noon local time, Hotel Quickly pushes out several hotel deals in key Asian destinations.  If you read the mobile FAQ on how it works, Hotel Quickly claims that its deals are exclusive to their app users.  I decided to put their claim to the test today.

For a one night stay arriving in Singapore tonight, Hotel Quickly offered six hotels.  Two were called 'prime', two were labeled as 'design', and the last two were classified as 'comfy'.  I decided to compare the rates and availability of these six hotels across some other popular mobile booking sites in Asia . . . specifically Agoda, Booking, and Expedia.

Here are the takeaways.  Keep in mind I compared all rates inclusive of taxes and service charges, the "all in" price.

1) Hotel Quickly (green bar in graph below) fell short of defending their value proposition, at least for today.  Their app didn't offer even one hotel that had rates lower than any other OTA's mobile app.  Even the featured hotel they recommended, identified by shaking the phone, was only on par with Agoda and Booking's rates.

2) Expedia (yellow bar in graph below) lost out in some way with four of these six hotels.  They didn't have availability or relationships with Hotel Royal at Queens or Grand Park Orchard, so these weren't bookable at all.  They did show availability at Amara and Ramada, but their rates were $30-40 SGD more than their competitors.  Yes, I made sure I compared the same room types.

Hotel Quickly has come out with aggressive marketing communications to create consumer perception that their rates are exclusive over other booking channels.  They also have a very clever kickback technique, including a referral program that snags users 10 USD in credits when friends make a booking with the user's unique invite code.  Although the average last minute consumer is less likely to compare prices across multiple mobile apps, Hotel Quickly needs to up the game on their so called exclusive rates if it wants to create real and sustainable value for its app users.  

Awaiting Hotel Tonight's imminent arrival to Asia

Awaiting Hotel Tonight's imminent arrival to Asia

In the last several years we've seen a surge in new mobile apps that allow travelers to book hotels for same day arrival.  Headliner apps that recently emerged include Hotel Tonight, Hotel Quickly, and Blink.  In fact, last minute and same day bookings have become such a hot topic that most of the traditional heavy hitters have also jumped in on the feeding frenzy.  Priceline has its Tonight Only deals, and Hotels.com has its Local Deals for Tonight, and recently Hipmunk launched its own Tonight Only deals.  This space is getting more crowded as travelers quickly migrate to mobile platforms.

(Sep 9 update - Blink just bought by Groupon)

Of the new mobile apps, one of them seems to be breaking away from the rest of the pack.  Hotel Tonight, a product of San Francisco, just received another $45 million in funding.  Despite growing skepticism that some of these last minute booking apps won't be around much longer, Hotel Tonight's funding seems to validate not only its existence but actually underscores its future growth potential.  So where will its future growth come from?

The obvious answer is global expansion.  When I whip out the app here in Singapore, I'm told that I'm too far away from any destinations where Hotel Tonight has deals.  Hotel Tonight has roughly 3,000 hotel partners in North American and European destinations, and it won't be long before they start making room for popular Asian cities and resorts.

Having millions in its war chest will help spur product innovation and marketing strategies and ultimately make the penetrating road to Asia a bit smoother.  But the money won't buy the strong relationships with hotel suppliers the company needs in order to get the best last minute rates for customers.  To build up their relationships (and relevance) with suppliers, Hotel Tonight will need to demonstrate its ability to drive last minute demand when they need it the most.  This won't be so easy since the company's existing demand profile is largely from North America and Europe, and data shows that the long haul traveler typically makes hotel bookings well in advance.  To be relevant in the same day or last minute window, Hotel Tonight will need to localize its app across the fragmented Asian nations to tap the growing local demand from domestic or intra-region travelers.  After all, these are the travelers that not only book at the last minute, but they book in volume.  Competition is hot though, and Asia is home to Agoda, Hotel Quickly, and Check In Tonight who have been sourcing deep hotel discounts on mobile platforms for a couple years already.

Apart from global expansion, I can see Hotel Tonight increasing their bookable inventory beyond same day arrival.  Although this will deviate from its current consumer messaging of booking a hotel for tonight (as the comapny name clearly suggests), I believe that adding inventory for a last minute booking window of within 7 days or so would still maintain a clear value proposition to both bookers and hotels.  I estimate that more than 50% of online bookings are made under seven days prior to arrival, so the size of the opportunity in this booking window is tremendous . . . especially for a company that has to date limited its focus to just same day arrival.

No Asian cities for now.  No . . . San Francisco and Vancouver don't count as Asian cities!

Travelocity's surrender to Expedia

I remember the first time I booked on Travelocity back in 2001 -- a nonrefundable airline ticket to Miami for spring break.  But being the beer bonging undergrad with impaired judgment at times, I accidentally entered the wrong travel dates.  I immediately called Travelocity's customer service hotline to rebook the correct dates.  They told me I had to make a new booking and refused to refund the erroneous one.  Man I hated that (ugly) gnome from that point forward.

Time to put this gnome out of its misery

Reflecting on this experience, I half grinned when I read about the strategic marketing partnership between Expedia and Travelocity announced last week and expected to begin begin next year.  It appears to me this is more or less Travelocity's inevitable surrender.  Its supply and customer operations will soon be handed over to Expedia, and the Travelocity brand will become little more than a gnome that thinks it can pull from its sleeve a marketing plan that will trump the online and offline marketing power of Priceline, Expedia, and TripAdvisor.

But will Travelocity even get a reasonable chance to flex its marketing muscle  when all its content and pricing will be powered by Expedia?  A Travelocity spokesman Joel Frey says they will continue to offer their own travel deals and pricing that will be different from Expedia.  I'm not convinced.  As if Expedia would even entertain the idea of letting its new ex-competitor affiliate undercut its own pricing, especially under the performance share model they've entered together.

The winner in this partnership is Expedia, who will soon absorb the North American traffic and booking orders of its previous arch nemesis.  According to Phocuswright, the market share of these two brands combined is over 60% based on its estimates of 2012 gross bookings.  Commanding this much market share will bolster Expedia's relevance and negotiation power with suppliers, and will likely lead to conversion increases as it sources better rates and inventory for consumers.  All of this couldn't have come at a better time with Booking.com biting at Expedia's ankles and OTA traffic increasingly diverted through meta search sites.  With intensifying competition and diminishing margins in the OTA industry, along with increased substitution from vacation rental sites, I suspect other companies will surrender themselves

For Airbnb and Roomorama, desktop is to mobile as amazing is to aggravating

When planning my European travels last month, I had a smooth experience searching for and successfully booking properties on Airbnb and Roomorama.  I browsed a wide range of suitable choices, and I even enjoyed the informal banter with some of the local owners.

That was a month ago.  Now fast forward to tonight and the booking experience nose dived from amazing to down right aggravating.  Separated from my laptop and with only my iPhone in hand, I attempted to make a booking for that same night in Oslo, Norway using Airbnb and Roomorama mobile apps.  Unlike a month ago though, I didn't have the luxury of time to flip through listings and chit chat with hosts about compatibility or availability.  I just needed a decent place in a decent location for a night, and I needed it asap.

All of a sudden my darling sites that served me so well a month earlier left me nearly homeless.  Despite having beautiful mobile apps with no shortage of mouth watering 'house porn' imagery from places everywhere but Oslo, both companies failed to deliver local listings that were immediately bookable for that same night.

Airbnb's mobile app defaulted me to its featured collection of properties in Paris, Berkeley, and Geyserville . . . wherever the heck that is.  Great, I get it.  They have stunningly sexy photos of unique properties around the world, but all I need right now is a room in Oslo.  Roomorama's app also gave me thumbnail images of properties from everywhere except the city where I needed to sleep.  I'm thrilled they have listings in Lisbon, Toronto, and Jerusalem (Illinois, not quite Israel), but did that put a roof over my head tonight in Oslo?  Nope.

At least with Airbnb's app, they have a quirky callout intended to help travelers who need a place for same day arrivals.  It's one click away on the search function and labeled, "Help! I need a place, tonight!"  It conveniently detected my location and then displayed a short list of properties that had calendars indicating availability.  Too bad none of them could be confirmed instantly and waiting up to 24 hours for a reply was out of the question.  The concept is great though and it's a nice start!

Brian Chesky of Airbnb aims to reduce this friction by increasing the number of properties that allow instant confirmation, a booking standard set long ago by the incumbent online travel agencies.  He calls this feature insta-book and ballparks around 1-2% of their current properties have this capability.  From my Oslo experience this is essentially like finding a needle in a haystack, especially if you isolate the same day arrival booking window.  For example, with 350,000 global listings, only 3,500 properties are insta-bookable under the 1% assumption.  Of those 3,500 properties enabled for insta-book, I would estimate a smaller fraction would actually have room availability for same day arrival.  And for Oslo?  I actually found none available.  Since I know I'm not the only one who books last minute, there's a lot of user pain that Airbnb and Roomorama could help alleviate with improvements to their mobile app . . . not to mention a lot of money on the table up for grabs.  Last minute bookings are typically the highest converting since the customer is intent on making a transaction.  Here are some ideas on how to improve conversion of last minute mobile bookings.

First, fix your supply issues.  Get more availability in destinations/markets with strong patterns of last minute bookings (e.g. corporate markets, city center clusters, convention compression periods).

Work with professional property managers who are more likely to have accurate last minute availability due to technological integration or because it's part of their day job to manage inventory.  Large management companies have the resources to support instant confirmation and can efficiently provide access to thousands of properties across broad regions.  On the downside, the apartments and social connections guests have with these managers isn't nearly as unique or experiential as with individual hosts.  But when you're desperate for a room for later that night, beggars can't really be choosers.

At the same time, identify the most active individual hosts and develop powerful mobile tools that equip them to more quickly update their availability calendars on the go as their plans change.  Let hosts opt in and receive booking requests by e-mail, text messaging, even phone calls.  When a new booking request for same or next day arrival comes in, it gets blasted to all opted in hosts and requires a response within 1 hour.  The first host to accept gets the booking and the guest gets automated check in instructions and more importantly peace of mind.  If no hosts accept, consider incentivizing with the removal of host fees.  The lost revenue is minimal and just a small sacrifice to convert the customer and keep them around for another day.

Next, make sure your last minute supply is properly showcased to the mobile user.

Instead of defaulting users to inspirational photos from around the world, just go straight for the jugular.  Have the app default users to properties nearby that are guaranteed available, and sort up hosts that have a strong track record of accepting same day bookings.  Give these hosts a special callout or badge so users know their chances of booking are strong.  Then apply the same set of sort and filters that users already use.

Lastly, before basking in the glory of helping last minute bookers find rooms, remember to brace yourself for a new pain point . . . relos!

Build a bullet proof relocations procedure because availability mistakes will certainly happen and there is nearly no margin for error when it comes to same day arrivals.  The biggest traveler disappointment is finding out on property that the last minute booking they made can't be fulfilled.  Service recovery is key, and a well trained agent who can help immediately relocate to a comparable property can help turn that traveler's frown totally upside down.  :-)

If companies like Airbnb and Roomorama currently fail to convert last minute mobile bookings, then at least on the bright side there is tremendous opportunity for them moving forward.  This is because trends indicate that mobile is the fastest growing booking platform (at least for the major online travel agencies), and that the booking window for lodging is getting shorter and shorter.  The focus on increasing availability of instant confirmation of same day bookings will benefit all last minute booking windows, and when combined with product enhancements will result in much improved user experiences and increased conversion . . . and the icing on the cake --> increased revenues.

In the end my trusty Expedia app saved the day in Oslo . . . for now.  I'm sure it won't be too long before Airbnb, Roomorama, and their peer companies beef up their mobile offerings and take a bigger bite out of the OTA market share in last minute mobile bookings.

Turning homes into hotels . . . Innovation you just can't learn from the corporate workplace or school!

My first Airbnb experience!

I've worked in branded hotels, the world's largest online travel agency, and studied hospitality and online distribution at Cornell's hotel school.  Despite the experiences I've gained over the last decade, none prepared me for one of the biggest movements currently going on in the business world -- the sharing economy.

The travel industry has been tremendously impacted by the rise of the peer to peer sharing economy.  The poster child of this new movement is Airbnb, the online marketplace for people to rent their own home out to travelers who seek a unique, localized, and often times cheaper alternative to conventional hotels.  Although the company is relatively young, it won't be long before its marketplace of lodging substitutes starts taking an enormous bite into hotel market share.  We're seeing it in Spain already.

Already in less than five years, Airbnb grew from 3 air mattresses in the co-founders' apartment all the way to over 300,000 listings in over 34,000 cities worldwide.  To put it into perspective, these supply figures and likely booking values already rival that of some major international hotel chains.  While there are competitor sites such as Roomorama, Wimdu, and Housetrip, the supply footprint of Airbnb dwarfs the pack at the highest aggregate level.

But the massive supply stats aren't the only cool numbers . . . did you know there are 123 people staying in castles on any given night that were made possible by Airbnb?  Yes, that's right . . . frikkin castles.  But there are some bad numbers as well, including the hefty fines imposed on some hosts for illegally renting out their homes.

The disruption that the sharing economy and specifically Airbnb has created in the online travel world has inspired me to start this blog.  It's really for me to organize my own thoughts and research, but I'll share news and provide some points of view on the sharing economy and the key players aiming to revolutionize the online travel space further.

Check out this video below for a good intro to Airbnb given by none other than co-founder Brian Chesky himself.

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