HotelQuickly heats up the last minute hotel booking model in Asia
The number of hotels in Asia is steadily rising, there are global brands making an entry into Asian countries and many existing hotel brands are expanding their presence.
This means the number of available room nights is also expected to go significantly higher leaving a lot of room for unsold inventory.
Last-minute hotel bookings are already an established trend in the US and Europe, in Asia this is still a developing trend.
HotelQuickly, a Hong Kong-based startup vows to eliminate the possibility of a hotel having unsold room nights.
The startup has a mobile app for iOS and Android platforms enabling customers to book last-minute hotels at a discounted (up to 70%) price.
HotelQuickly was launched last month in six countries across South East Asia and it has raised $500,000 seed funding so far.
The company has 20+ employees, including five co-founders: Tomas Laboutka (CEO), Raphael Cohen (CSO), Christian Mischler (COO, recently stepped down as Global COO of Rocket Internet’s Foodpanda), Michal Juhas (CTO) and Mario Peng (CFO).
Tomas Laboutka, Co-founder and CEO says,
“The goal of the company is not only to enter the market fast, but also build a world-class offering to become and remain the first name in same-day hotel bookings. We will constantly improve and enrich our application based on the feedback from our users. The customer experience is at the heart of everything we do.
“The hotels we have chosen to partner with understand this as well, which is part of the reason we have been able to sign up with some of the best hotels out there. They value the fact that we will take good care of their reputation, present them in the best light, and give them a great opportunity to surprise and delight the customer.”
Raphael Cohen, CSO says,
“Hotels don’t see us as just another marketing or distribution channel, but as a way to optimize their occupancy and to cover costs, which they otherwise would have to carry themselves.”
Q&A with Laboutka below.
Describe what your startup does, what problem it solves and for whom?
HotelQuickly provides a simple and convenient way for everybody in need of an immediate hotel room. The app allows you to book a hotel in less than 20 seconds with a guaranteed lower price than anywhere else.
This comes as great news not only for travellers who have ever missed a flight, but also for someone that has been stuck in a meeting and missed the last train/bus, or has been out partying all night long and suddenly feels tired and prefers to catch some rest.
We offer a mobile app for iOS and Android, which allows booking of hotel rooms for the same night, every day between 12 noon and 2am in the morning.
For hotels it solves the problem of unsold rooms – they get the means to sell overstock via a different, private channel. ‘Private’ not because it would be limited to members only, but because only the users of our app will be able to benefit from the big discounts granted by the hotels.
Why should people or companies use your app?
We take the hassle out of hotel booking.
A few years back, business and leisure travelers were relying on traditional travel agencies to book their trips.
Now, everyone turns on their computers to book a hotel online. This easily takes 30 minutes in order to select the right hotel, pick the best location, assess best value for money, review what others think of the place and finally book a room.
This is already better than what traditional agencies offer, but we can do much better.
We apply the most popular filters and only show the best hotels in close proximity.
While giving users the benefit of convenience, hotels appreciate HotelQuickly as a tool to optimize their occupancy in real-time.
Other than going viral and receiving mountains of positive PR, what is the strategy for raising awareness and getting customers/users?
We teamed up with a few well-connected investors, who not only support us financially, but also opened doors to close and important partnerships. Furthermore, we will leverage traditional marketing channels in order to raise attention to this new concept in Asia.
Lastly, we give out additional discounts and incentives to our members for their loyalty and support.
For every successful referral, we give 8% discount on top of the already reduced rate. In the case of five-star hotels, this can easily account for an additional US$20 to 30 saving for each successful referral.
What is your revenue model and strategy for profitability?
Hotels join for free, we only charge a small commission upon successful bookings, hence the risk for hotels to join the concept equals zero.
The more bookings we manage to generate for our partner hotels, the closer we will get to profitability. It is a win-win model for both hotels and us, that is why we get a lot of support from our partners.
Our application is free to download and we always show the end price in our app, including all taxes and fees.
Transparency is crucial in our opinion. We do not trick customers by showing incomplete prices.
How did your initial idea evolve? Were there changes/any pivots along the way? What other options have you considered for the business if the original vision fails?
Since the start we had a very clear idea of what we wanted to achieve.
The concept is simple and straightforward on paper, however, it requires a lot of brainpower and dedication to build up the concept across time zones, language barriers, while facing the challenges that naturally come with being active in some of the developing markets.
We are still far away from reaching what we envision, but we are happy to say that we are on track and we have not been held up by any pitfalls thus far.
Where do you see yourselves in 3 years time, what specific challenges do you hope to have overcome?
We already established ourselves as the clear number one last-minute booking app in South East Asia in terms of market reach and number of partner hotels, while offering our app on iOS and Android.
We started a month ago and this is already an important first milestone.
Within the next 3 years we will expand dramatically domestically and internationally, and will “own” the markets in which we are active.
The better our apps, the more loyal users we will have. The higher the loyalty, the more bookings we will be able to generate for our partners.
They, in return, will grant the best possible discounts to our users and leverage HotelQuickly as the powerful occupancy optimization tool that it is meant to be.
What is wrong with the travel, tourism and hospitality industry that requires another startup to help it out?
People love to travel for leisure, and they have to travel for business. We simply created an alternative way to book a hotel in order to save time and money, so people can save their time and money to do more meaningful things.
We provide a complementary concept to online travel agencies, as we aim at serving specific user needs and use cases.
The travel space is constantly changing and new technology offers new opportunities, which we leverage to the benefit of the tech savvy and open-minded last-minute traveler.
Last-minute hotel booking is a relatively new concept in Asia. But, the market is not without its competitors. For example, CheckInTonight, a Cambodia-based startup also focuses on the same model and service.
However, Laboutka says,
“We do not see CheckInTonight as a competitor, but as an ally in promoting the concept of same-day hotel booking in South East Asia. Mark (CEO of CheckInTonight) and his team did a great job in creating a mobile application, even though they are based in Cambodia and did not manage to attract investors.
“The market is clearly big enough for two players, and while CheckInTonight seems to focus more on the smaller markets in the region to gain a quick foothold in the developing markets (Cambodia, Laos, Vietnam), HotelQuickly targets the big metropolitan areas.”
For now, both HotelQuickly and CheckInTonight clearly have an early-mover advantage.
In terms of competition – there are few regional players right now, but very soon this space will become crowded in Asia too.
When the ‘mobile-only, last-minute-only, hotel-only’ space becomes crowded, it will be interesting to see how this model transforms.
Earlier, Berlin-based startup JustBook, which has a similar business model launched a website for last-minute hotel bookings, in addition to its mobile channel. These trends might be picked up by HotelQuickly as they currently say – we are ‘mobile first’.
Karthick was general manager for Tnooz in Asia until September 2014.