Wednesday, March 21, 2012

Guestmob: A New Level of Stupidity for Hoteliers?

This morning, we saw a FB posting from a good friend about a new website, Guestmob claims to offer prices "20-50%" lower than Kayak by pitting hotels "against each other for the right to fill empty hotel rooms"

Consumers enter the site and pick a destination and dates par usual, and then offered a selection of hotels grouped by star quality and neighborhood. Sound familiar to Hotwire or Priceline? Yes, except the hotel name and brands are exposed. As are the retail prices for these hotels.

Next, a consumer selects the area and star level they want to stay in and is taken to a confirmation page showing the selection of hotels that Guestmob will later solicit (like a mini RFP) for the consumer's stay:

3 days before arrival, Guestmob lets the consumer know which hotel has "decided" to let them stay.

Hoteliers: downward rate spiral, anyone? Haven't we seen this movie?

Lets dive a little deeper, however...

First, we doubt that all of these hotels are actually participating in this platform. We kinda doubt that the distribution hawks over at Marriott have embraced a less opaque version of Priceline when they don't even participate in Hotwire. As for the other brands listed throughout the site, good for Guestmob if they have really signed up these chains but we think they are probably shills.

Second, Guestmob is listing competing OTAs and their "pricing." We imagine that the OTAs will probably find this rather distasteful for obvious reasons.

Finally, for hotels that actually are participating in Guestmob, I ask one question: WHAT ARE YOU THINKING?

Hotels have been complaining for years about OTA margins and the lack of consumer brand loyalty. Opaque sales are an important revenue management tool but no one in the industry is particularly excited about growing the segment.

And yet, we still have hoteliers who apparently are seemingly not bothered by ANY of these issues and are willing to give street cred to what may be a very destructive model. Wow.

1 comment:

  1. Good post, Tom. Price cutting is for sissies, it's as simple as that.

    Sites like Guestmob and Backbid only tell consumers that the existing rates they see, even from opaque sites, are meaningless, and that consumers should view those rates as a starting point.