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!

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.