A bold statement from Switzerland-based Treovi, a startup which is about to take the covers off a service which it says has a business model “very different” from other online reservation services.
The company is the brainchild ofÂ Mohamed El Nasharty, Michal Wrobel, Peter Burjanec, Tom Pitcher, a quartet without specific roles but backgrounds in hotel business and finance (Nasharty), strategy and product development (Wrobel), design and marketing (Burjanec) and code/developing (Pitcher).
A further six members of staff make up the full team. The company is currently self-funded and, as its founders are eager to point out, not connected with any existing travel agency.
So what is different about Treovi?
The company says any hotel will be able to register for free to list their inventory and they will not be charged for bookings. Users will not pay for securing a reservation either.
How does it make money, seems to be the obvious question then. Treovi says it will only introduce “additional paid services” (though isn’t clear what these might be) “at a later stage of our development cycle”.
Such services will be optional, it says, not impacting on what it says will always be its “core concept” of free reservations.
“This revenue will help to support the costs of our free service (which, incidentally, isn’t as expensive as existing travel agents would like you to believe).”
Q&A with co-founder Michal Wrobel:
How is the way you are solving this problem more special or effective than previous attempts you or the market has seen before and how different do you have to be to succeed?
We are establishing a modern and progressive sales model in the hotel industry. This sector has been stale since the 90s, and has missed out on the innovation that many other industries have been enjoying for years.
Our interfaces for both hoteliers and guests will be as functional and fresh as our business model – providing an efficient and pleasant experience for everyone involved. No one likes fighting through a website to get something done, and we’re focusing on solving that.
Why should people or companies use your startup?
We’re going to provide a service that is both free and a pleasure to use. Additionally we plan to introduce tighter integration with social media services, as well as some innovative tools for customers.
Other than going viral and receiving mountains of positive PR, what is the strategy for raising awareness and getting customers/users?
We’ve got a full ad-campaign planned for future users and we’ll be directly contacting potential partner hotels. We don’t want to divulge too much information on this yet, but we’ve got some big plans ahead, so stay tuned!
What other options have you considered for the business and the team if the original vision fails?
As long as hoteliers are interested in saving money and retaining their sales freedom, our core vision cannot fail.
However, we expect to be constantly adapting the functionality of our additional services to the needs of hoteliers, and look forward to building solid platforms and features for them to utilise.
What mistakes have you made in the past in business and how have you learned from them?
The core team is experienced in their respective fields. We have behind us successes related to growing online communites, web design and programming, design for successful startups, hotel group management, strategy for market introduction of various consumer products.
We are familiar with the bumpy road to success, and have a catalogue of past experience for us all to build and expand upon.
What is wrong with the travel, tourism and hospitality industry that requires another startup to help it out?
The web has grown to be far more than just an alternative to using the telephone. For businesses like hotels, it should allow increased access to competitive products and services that can save them money and allow investment in other areas.
Until now, the online products and services available to the travel industry have utilised some of the available technology, but deliberately reinforced the old commissions business model.
We will break this mould and finally deliver this lost opportunity to market, providing desperately-needed savings to hotels by freeing them from the stranglehold of commissions.
Hotel distribution might not come across as controversial as its airline counterpart in recent years, but it is certainly triggering a number of new business promising a revolutionary model (Global Hotel Exchange, being one of the most high profile and vociferous).
Treovi, like GHX, is trying to tackle the problem by coming at a perceived problem in the industry in a different way – the commission issue, in this case by not having any at all.
While in some respects it sounds too good to be true (especially for hoteliers), Treovi’s obvious challenge will be how it grows the business without a discernible revenue source.
The company says it will come up with optional revenue-generating services from hotels, but with a team of ten to support and other bits of infrastructure, volume of users will be massively important.
And therein perhaps lies the largest problem: getting users. Will an ad campaign be enough?
Given that, in Europe for example, Treovi’s biggest competitor, Booking.com, is a massive and long-term spender of search marketing, ensuring people find the site in the first place (in the midst of dozens of other hotel booking services), stick with it with future bookings, and tell others, will take either a large marketing budget, pick-up in social and mainstream media and/or a dose of luck.