|3 Challenges and Opportunities Online Hotel Booking Sites Face.|
By Elaine Huang, e27
Thursday, 3rd October 2013
The online hotel booking industry is booming, but service providers still have to watch out for some challenges.
In 1997, two men — Michael Kenny and Robert Rosenstein – co-founded a company with a website named PlanetHoliday.com, which aimed to disrupt the hotel booking space. In Phuket, Thailand, they started to work out deals with hotels and charged users directly with their credit cards.
In early 2000, the company started experimenting with user experience features like real-time chat with customer service officers, and grew the business with pay-per-click advertising.
In 2003, PlanetHoliday added PrecisionReservations.com as a partner and the two merged as Singapore-based Agoda. Later on in 2007, Agoda was then acquired by Priceline. Robert, now the CEO of Agoda, told Tech Cocktail in 2012 that he had started the company with a global site in mind.
“We felt we could create a global site that would have the scale and reach to deliver better deals and more choice through a simple online booking interface,” he said. “Also, we loved to travel and this seemed like a fun business to be in.”
Currently, competition in the online hotel booking industry is rife and everyone seems to be wanting a bigger slice of the pie. Putting ourselves into the shoes of those in the online hotel booking business, there is a bevy of problems, challenges and opportunities waiting to be faced. Taking this into a different perspective, though, challenges can be well taken advantage of.
This can be especially profound in Asia, a fragmented and diversified market thanks to the multitude of languages (including dialects) and cultures available. Here, we speak to several big players in the industry to understand how they’re taking a shot at this part of the region.
Challenge #1: Customer acquisition
Robert shared that even though there has been substantial growth in terms of developing markets and in Asia, there is still an untapped market in Southeast Asia.
He added, “There are still so many customers across Southeast Asia that aren’t using online hotel booking. Many new customers are using mobile as their primary Internet device and making their first booking on a small device last minute.”
He also explained that in the past, Internet access and the slow adoption of online credit payments in markets where e-commerce is a foreign and still nascent industry have been cited as issues and hurdles for online hotel booking sites. However, now Agoda is looking at tackling multi-device behaviors that involve tablets, mobile devices and desktops.
This year, their goal is to reach new types of consumers with mobile devices who are constantly on-the-go. He also cited data published by the Pacific Asia Travel Association,which revealed that there has been significant growth in terms of tourists entering Asian countries like Myanmar (+52 percent), Cambodia (+24 percent) and Laos PDR (+22 percent).
He added, “The same data also noted overall arrivals to Asia grew by 9.9 percent. We tend to concentrate our efforts on Asian markets and their most popular destinations.”
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