HotelTonight
2 years ago
 

HotelTonight to switch from pure same-day booking model

Travel technology company HotelTonight is moving away from its signature same-day booking model to a more flexible one, where users can book up to seven days in advance.

Beta-testing is set to launch this week, Tnooz has learned. Details are expected to be made public by the end of next week.

With this move, the San Francisco-based startup stops depending on its pioneering, niche emphasis on same-day booking, which led to partnerships with more than 10,000 hotels and to its app being downloaded 11 million times.

HotelTonight’s decision may be a sign that its exclusively-“day-of” booking model could only scale so far to satisfy its investors, who have poured $80 million into the company to date. Added date flexibility may be seen as a way for the startup to persuade more users to book rather than just browse.

At stake is the quarter of US online travel bookings — or about $40 billion — that will be made on a mobile device by 2015, according to estimates by market research firm PhoCusWright.

Significant change

HotelTonight is adopting an approach that’s closer to the one long-championed by online travel agencies (OTAs).

Since September 2011, Priceline, one of the largest OTA brands in North America, has bundled its so-called “Tonight-Only Deals” — which use a flexible-date booking model — in its app.

HotelTonight will now have to depend more on its user experience as a distinguishing factor. It says users can book a room in as little as four taps, or eight seconds. Priceline’s app requires at least 52 taps and Hotels.com‘s app (which also has flexible-date search) needs 40 taps.

Driven by consumer behavior?

HotelTonight declined to comment for this story. But a year ago, Tnooz asked CEO Sam Shank if the company would expand its lead-generation model and not necessarily be limited any longer to hotel bookings within a window of roughly 12 hours. Shank said:

“We don’t see any limitation in what we’re doing today that means we’d need to move away from our focus.

We’re staying very focused on our vision for on demand lodging, helping you get into a hotel when you need it and get you what you want very efficiently into the right hotel.

We see an enormous opportunity, and we are just getting started in terms of the vision for where we see that going and where we want to be in four or five years.”

Now HotelTonight might argue it’s still focused on “on demand” travel but that there’s been a change in how travelers are using mobile devices.

It may see consumers moving from mostly “on-demand” transactions, such as ordering a pizza or an Uber black cab on a whim, to a mix that includes more deliberate trip planning.

The shift in consumer behavior may be due, in part, to the expanding size of device screens. There’s also been rise in consumers “snacking” on content via their devices throughout the day.

Shifting landscape for same-day booking

The move by HotelTonight appears to be in response to trends recently illuminated by eye-opening data on the size of the last-minute mobile booking sector. Some 30% of searches on OTA mobile websites and nearly one in four on hotel mobile sites are for same-day or next-day check-in.

There have been other shifts in the same-day booking landscape, as rivals receive funding or debut new styles of same-day booking tools.

UPDATE 25 Septmber: Britain’s Hot Hotels immediately debuted same-week booking on its iOS and Android platforms. In the spring, it received $1 million investment to expand internationally.

In August, Roomlia launched as a booking app for hotels that has flexible-date reservations. The project was acquired by Remark Media in May for $6.8 million.

In March, France’s VeryLastRoom raised $2.1 million funding.

Recently Hong Kong’s HotelQuickly has raised $5.56 million. [CORRECTED, SEPT. 25. I originally wrote $1.7m. Sorry.]

A year ago, metasearch site Hipmunk launched “Tonight deals” — a metasearch pull of same-day hotel offers — via its app. It has since claimed it has had significant revenue gains, which it credits partly to that product.

To compete, Hotel Tonight appears to have engineered better-than-industry average performance with its e-mail and Facebook marketing.

Is touch functionality next?

In other news, the HotelTonight app for Apple devices has been updated to be compatible with the latest operating system, iOS8.

It’s unknown when HotelTonight will add a feature that lets user pay by fingerprint. Apple’s TouchID API can be used to enable a user’s fingerprint image to serve as part of two-factor authentication. Touch ID was made available to third-party developers last week, after a first wave of apps debuted, such as in Intuit’s Mint app.

Touch ID, in combination with other wireless technology, could also be used to as a “virtual room key”. In June HotelTonight touted its plans to innovate in virtual hotel room keys.

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Sean O'Neill

About the Writer :: Sean O'Neill

Sean O’Neill had roles as a reporter and editor-in-chief at Tnooz between July 2012 and January 2017.

 

Comments

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  1. Jamais Trujillo

    We have been hoping that HotelTonight would open up thier site to condo rentals too. We in Playa del Carmen,Mexico could benefit from this platform.

     
  2. Des O'Mahony

    As mentioned back in May, coupled with similar clear evidence from own-site hotel bookings on mobile: http://bookassist.org/blog/post/mobile-user-behavior-is-changing-on-hotel-websites/en/

     
  3. Josue Gio

    Never say never…
    Next: Mobile Only AND Web Too
    LastRoom lesson learned about Same Day Hotel Booking & Travel Industry: https://medium.com/@angiecois/our-real-love-are-business-travelers-e98c98080e61

     
  4. Rafał [HS]

    Good news! I’m sure I’ll be using this app more often.

     
 
 

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