After hotel partners received threats from a big OTA, mobile-only startup HotelQuickly decided to form a closed user group

When Hong-Kong based last-minute hotel booking mobile app HotelQuickly launched a year ago, it had high hopes. But it quickly learnt that - even with over 200,000 downloads of its app - competing against the big boys isn’t easy.

Recently, the firm chose to change direction to become a fully private sales channel, making its prices only available to a closed user group. Users need to sign up to become a HotelQuickly member before rates are visible.

Despite the challenges of the past year, the team is confident that with the combination of mobile technology and big data, it is able to “deliver a more satisfying user experience than any OTA has been able to do in the past”.

It’s been a bit of a roller coaster ride and here EyeforTravel’s Ritesh Gupta catches up with  HotelQuickly’s Christian Mischler, Co-Founder and COO, about the journey so far.

EFT: So what made you decide to become a fully private sales channel?

CM: Rate parity agreements between hotels and OTAs prohibit hotels to offer more favourable rates on one public distribution channel vs. another. Even though the target group of HotelQuickly is completely different from an OTA, hotels were put under pressure by the major [OTA] player in our region and threatened to be delisted from its website.

EFT: How did you respond?

CM: We had to change our approach and create a closed user group, hindering the random download of our app to see rates. In order to see prices, one has to register on the application and with that become a member of HotelQuickly. To be ‘members only’ is just one reason why rate parity does not apply to our distribution channel: we also show no room type, we offer our rooms for a limited time only (same day between 8am until 4am the next morning), our rates are accessible via a mobile app only, and we follow strict non-cancellation policies. This helped us tremendously to recover good deals. Now we are able to offer on average 28% cheaper rates than any OTA - numbers based on a full-month average in January 2014 across all 12 countries covered by HotelQuickly.

EFT: Tell us a bit about your growth trajectory and the lessons you’ve learnt along the way?

CM: We see a direct relation between number of partner hotels and number of bookings. We remain fairly steady in terms of downloads per day, but since we tripled the number of partner hotels in the past four months, the number of bookings increased dramatically. To date we managed to get about 2,000 partner hotels onto the application and, of course, only the ones with the best discounts are being displayed on the app. We curate our partner hotels and work with only the best three to five-star hotels in any destination; by the end of February we are covering almost 100 destinations across Asia Pacific.

EFT: To what extent have bookings risen via your apps over the past year and what have you learnt?  

CM: In the early days we had a limited number of partner hotels (and showed only six per location) and had just a few destinations (six countries). The app was available for iOS and Android only. Now, we show the top ten hotels, the discounts are great, the hotels are shuffling daily or sometimes even intra-day, based on occupancy and availability, and our app is available also for BlackBerry.

The app is more engaging than before. We’ve learned quite a lot from our users, and the data collected over the past 11 months helps us a lot with signing the right hotels, expanding to the right destinations, and displaying the most sought-after hotels on the app. Apart from engagement, we have seen the download to registration ratio increase dramatically. This in turn helps us again to tailor our product better to the needs of the user, as we know more about who is using our app in what way.

EFT: Going forward, how do you see technology improving the mobile booking experience?

CM: We are working with the most advanced tech solutions available on the market. We are pushing limits in many aspects, which can be annoying at times, as many of our partners have never done certain things before we started to collaborate and hence the error potential is higher than for standard solutions. At the same time, we see that with the combination of mobile technology and big data crunching, we are able to deliver a more satisfying user experience than any OTA has been able in the past.

EFT: Tell us where you see this headed?

CM: My personal vision is to be able to perfectly predict the hotel choice of any of our member before he or she even starts to think about where to stay. We are far from this, but much closer than any traditional player in this area. Booking a hotel will be very different in a few years from now, and we believe are at the forefront of developments.