Peer-to-peer hotel room reservation marketplace Hall St says its price bidding and trading model will hit a critical mass when it generates a community of around 500,000 users.
TTI Autumn: Peer-to-peer hotel rate marketplace targets 500,000 for critical mass
Peer-to-peer hotel room reservation marketplace Hall St says its price bidding and trading model will hit a critical mass when it generates a community of around 500,000 users.
The website is one of a number looking to disrupt the traditional hotel operator third party retailer model but differs markedly from the commission-free Treovi and Global Hotel Exchange concepts.
Hall St allows users to make their best bid for a hotel room, which the hotel can either accept or reject, but it has also created a secondary market allowing customers to sell back unwanted nights.
Hoteliers can also upload their own offers and in the same way users can either accept or reject the price listed.
Founder and chief executive Alfredo Ouro told the Travel Technology Initiative Autumn Conference this week that it was now in its crucial third stage of development.
“Our first step, because it’s a catch 22, was how to build from concept to product, the second was how to link hotels to the platform because without hotels it’s impossible to have users.
“Now we are focusing on launching the product for the consumer side. This is our third step. We have a small database of users but the results have been really interesting, especially if we focus on a particular destination.”
Ouro said the concept was dreamt up after he had made a late booking but then his plans changed and he ended up with a hotel reservation he did not want.
He said the idea is an answer to the ‘Googleisation’ of online marketing which sees intermediaries demand high commissions of suppliers due to the high costs of distribution.
This in turn means the suppliers do not have any price liquidity because they are forced to maintain price parity and the consumer offering is less flexible.
Ouro said the Hall St concept taps into a number of current trends including “doing deals is cool, regardless of whether the brand is luxury or otherwise” and community-based peer-to-peer trading.
Instead of price comparison sites dictating the best price, the Hall St model means the best price is the maximum any consumer is prepared to pay for a particular hotel on a particular night.
“It’s a platform that links hotels and users and allows them to purchase room rates in private. It provides instant price liquidity for hotels and additional flexibility for the users,” Ouro said.
“Intermediaries can add real value with a system like ours. Most people just see them as a cost.”
Hall St earns it money by charging a customer transaction fee meaning it can offer the hotelier a low-commission model for distributing its rooms.
Further exploiting the community concept, Hall St is also developing a functionality to enable users to agree to share rooms or for donating rooms for good causes.
To date Hall St has more than 5,000 hotels and 45,000 registered users. Ouro said the 500,000 to hit a critical mass is “a big number, but not a big number”.
The site ultimately aims to have five million users within the next four years and have agreements in place with more than 15,000 hotels in more than 100 locations.
A mobile app has also been developed on which hotel room rate trading can take place in one easy to use interface.
