One of the newest forays into the increasingly crowded
online hotel booking tool category is a site targeting travelers who already
have made their initial reservations. Unlike most other booking tools, BackBid,
launched in November, does not provide travelers lists of hotels and rates to
sift through. Instead, it asks travelers to provide hotel reservation
information and gives participating hotels the opportunity to offer more
compelling deals prior to arrival. BackBid co-founder and executive vice
president of marketing Chris Patridge recently spoke with BTN lodging editor
Michael B. Baker about the site's development, growth trajectory and
implications for business travelers, including those in managed programs.
How does BackBid work?
There are three ways to do it. If you're a TripIt user, you can simply sync your TripIt profile with your BackBid profile. Then, every time you're using TripIt and you have a new hotel booking, that's rendered to us as well. The second way, if you have an e-confirmation, is just to forward it to us. The third way, if you're on our site, is that you can answer manually if you don't have an e-confirmation, with your reservation details, and we'll go from there.
With all three of them, we end up putting that reservation in our database, and our hotel partners query that database on the dates they're looking to secure business, and they'll formulate bids based on what's out there. A big benefit, if we're talking business travel, is when you post the reservation, you have the opportunity to let hotels know what amenities and services are important for you on this trip. You can put on the post that you'd really be interested in free Wi-Fi in the room. When they're creating their bids, they can go from a discounting perspective and offer a rate that's better than your current reservation, but we try to encourage our hotel partners to offer added value. In that case, they'd see this set of travelers is looking for Wi-Fi in the room and include that in their bid out to them.
It's consumer-friendly, because consumers are telling the hotels what they're looking for, instead of hotels telling consumers what they offer. Some of our hotel partners are looking at a travelers staying at three-star hotels, and if the partner is a four-star hotel, they can sweeten the deal also by offering a star upgrade. They'll match your price at three-star, but you'll have these amenities and services at a four-star included.
Did you have the business traveler in mind when designing this?
Indeed. The very inception of BackBid was based on the frustration we were having online booking our business travel and how often we have to cancel and rebook. Prices would dynamically change. You couldn't be sure you had the best rate. We thought, “What if you turn that on its end and let the hotels know that we're coming? What can you do for us?” We could let the hotels know we're confirmed travelers who knew their market.
What about travelers who are part of managed programs?
We let our travelers let us know if they're traveling on business or leisure. It's not a mandatory field, but an awful lot are checking that off. We're seeing SMEs that don't have the big corporate travel programs are using us extensively. That's where I was coming from as well, working as a consultant on my own when I developed the idea. I was doing my own travel planning.
Certainly, the large organizations are more than welcome to put their reservations up on our system, but sometimes they're limited in their choices at a given destination or they have to stay with certain negotiated-rate hotels.
It's not for everybody. Somebody who's having their booking done by the corporate travel department in a large organization, we're not looking to get them in trouble. We don't see that as part of our core demographic at this point.
Could there be a use for buyers who have secondary or tertiary markets where they do not have sufficient volume to negotiate a rate?
Absolutely. In that case, a corporate travel manager even could post reservations with us and entertain bids from competing hotels. From that perspective, it could be a big win.
Is anyone doing that yet?
No, not to my knowledge, though it is something we're exploring. Right now we're handling growth more than business development and new markets, but it's certainly on the radar. I certainly see it as doable and an interesting prospect for corporate travel managers.
How many hotels are in your system?
Right now, we're in 16 different markets. We have probably around 200 hotel partners right now. We're growing every week, so it's hard to get a handle on the number. If someone wants to post a reservation in markets where we don't have a hotel partner, we have technology to go out and find competitive rates and deliver those to consumers.
Is that a metasearch-type capability?
Yes, you could call it metasearch, though the actual technology that we created is patent-pending right now, so it's actually a new process.
Are all of your markets in the United States?
Yes. We're looking to expand to other markets. By the end of 2012, we will be in other markets.
Do you have a mobile strategy?
We are developing our app, and we're looking at a 2012 timeframe for that app to be ready.
How do you work around cancellation policies?
We communicate clearly with consumers, directly into their email box. Part of the messaging we're clear on is to make sure what you're posting is cancellable and that you know what your cancellation penalties could be and what your cancellation deadline is. They have to let us know, or we get it off the e-confirmation, and that's when we'll stop sending them bids. Interestingly enough, we're seeing a lot of the activity happening in the last 24 to 48 hours. Conceivably, people are getting to destinations, getting off their flight, pulling out their iPhone and checking the latest bid, and that's where they'll pull the trigger, so they can tell the cab which hotel to go to. You laugh, but it is happening that way, and it's where a lot of online travel bookings are going. Lead time has been shrinking steadily over 20 years, but more particularly in the last two or three years since widespread adoption of online bookings has come about on the consumer side.
This interview originally was published by The Beat.