Mobile devices and apps spurring spontaneous hotel bookings

It’s naturally stating the obvious, but summer travel is a big deal for Canadians, and mobile devices and apps have dramatically changed how people research and plan where they plan to visit and stay. It’s also changed how quickly they can pick up and go.

There has never been another time in history where researching a destination and hotel can be so thorough, or booking a room at one nearby so fast. Where websites have long dominated the planning process, apps are growing faster. The World Travel Market Global Trends Report forecasts that mobile bookings are expected to reach 35% of all online bookings by 2018.

Given the rate of smartphone adoption and stagnant PC sales, the number shouldn’t come as a surprise. Browsing through an endless supply of hotels, filtered by location, price and star rating, can take seconds to produce a comprehensive list of what’s available. Vendors who market accommodations have used these tools to slash the time consumers need to make a decision.

HotelTonight, whose name speaks for itself, has always been premised on the scenario of needing a room as quickly as possible. Unlike most of its competition, the app is the only way to use it, since the website is nothing more than a flashy landing page. Now, the company wants to expand (slightly) beyond serving the last-minute crowd.

Its latest feature is a tab at the bottom called Escape, which curates both the hotels and a list of destinations based upon popularity and current pricing data in particular cities and countries. Being located in Toronto, Niagara Falls and Muskoka were more prominent, though even cities as far away as Athens and Barcelona came up. The main idea is to suggest a place to go and stay that is either a weekend getaway within driving distance or short flight away, or a longer haul that might offer an incentive if the hotel is offering a good deal.

Another recently updated feature is GeoRates, where hotels can target specific locations with special offers and rates. Airports and train stations are physical places where people within a specific radius of those travel hubs might luck out on a better deal, says Howard Migdal, regional director of HotelTonight Canada.

“It would also be possible for a Toronto hotel to specifically target people looking for hotels in Toronto while they are in Vancouver, if their data shows them that they get a lot of bookings from people in Vancouver. It provides hoteliers flexibility in their marketing efforts, and much more personalized offers at lower prices for consumers,” he says.

Migdal admits hotels have a “love/hate relationship” with online travel agencies (OTAs) because they are forced to offer ever-decreasing prices. Particularly in North America, hotels and OTAs have rate parity agreements where they have to monitor pricing to ensure compliance. Hotels risk lower visibility on OTA platforms if they don’t comply, which already sets limits on their ability to market their own rooms.

HotelTonight only shows hotels it has a direct relationship with, and by helping them occupy empty rooms last-minute, the lowest price can sometimes be found there. “As we are an app-only platform, our rates are not able to be scraped by other OTAs, which affords another level of comfort for hoteliers,” he adds.

A trend of spontaneous travel probably doesn’t hurt, either. Internal research at Booking.com http://booking.com revealed that 96% of Canadians believe technology has made booking so easy that it has spurred them to travel more spontaneously. It appears to be catching on, now that almost half of reservations made worldwide on Booking.com within 48 hours are done on mobile devices. There was no precise data on that for Canada, however.

Booking Now is a feature catering specifically to those looking to book within a 48-hour window, harnessing Booking.com and location data to provide custom recommendations for the over 675,000 accommodations it includes globally. There’s even an Apple Watch version, where travellers can book with taps on their wrist.

Then there’s Trivago, which appears to have benefitted from the actor who is the face of the company on TV ads. Being a booking site made up of booking sites, it uses a proprietary sorting algorithm that brings the most relevant hotels to the top of a list, one that can be tailored even further by a number of filters that narrows things down considerably.

The company claims 700,000 deals from more than 175 booking sites, which includes Booking.com but not HotelTonight because the latter is mobile-only. Still, that’s not stopping others from making special offers aimed at mobile-wielding consumers.

“Hotel suppliers are also offering ‘Mobile Only’ pricing, which may allow users to save money in comparison to what they would on their PC,” says Jon Eichelberger, who oversees Trivago’s North American operations. “Nowadays, hotel apps tend to further integrate app usage beyond searching and booking a room. Some hotel brands are already testing and rolling out app-based check-in and room key systems to offer consumers ease throughout their travel experience.”

They may not have had much choice. The success of Airbnb has shaken up the concept of renting out a space for a short stay in virtually every destination across the globe. The company has gone through an overhaul the last 12 months that includes a new logo, new look and reimagined apps. The iPad and Android tablet one only went live in April.

“While individual short-term rental accommodation has exploded in the last several years, it still is only a small piece of the market, and the reasons for using each product vary by traveller and travel situations,” says Eichelberger. “Personalization, in my mind, happens in both situations. From large hotel brands to small independents and even apartment owners listing their places on Airbnb, anybody in hospitality are, with varying degrees of success, trying to personalize the guest experience to build a loyal customer base that would recommend their product.”

That hasn’t stopped at least one of Trivago’s suppliers from jumping on the bandwagon. Of all the properties Booking.com references, approximately 70% are not hotels, but rather family-run bed and breakfasts, cottages, villas and private homes or apartments. Even tree houses and castles have made the cut, says Todd Dunlap, managing director for the Americas at Booking.com.

Meanwhile, HotelTonight already goes by its namesake, focusing on those who want the “guaranteed comfort” of everything hotels offer. “These two use cases are very different, and HotelTonight excels at offering the hotel use case to a broad range of consumers looking to stay in a hotel, within the next seven days,” says Migdal.

Of course, travelling does cost money (unless you’re particularly fortunate), and the real tie that binds all these sites and apps together is pricing. A vacation that may have seemed far-fetched can become a reality if the price falls just right. In catering to more than just one wealth demographic, a wider subset of customers is able to browse and consider the various options presented.

The question of whether tablets will supplant computers and smartphones as the travel booking tool of choice remains to be seen. Criticism over payment via mobile device has been a narrative around growth in the past, but all of those interviewed see that perception changing in short order. In less than five years, more trips could be booked and paid for via mobile device than on computers, perhaps marking a true point of no return for travellers.