Expedia And Priceline’s Mobile Application Releases And The Trends That Govern These Launches

PCLN: Priceline Group logo
PCLN
Priceline Group

Expedia’s Real Time Feedback and Sell Tonight: Improving Service Experiences For Both The Traveler And The Hotelier

On January 13, Expedia (NASDAQ: EXPE) announced the release of two new products called Real Time Feedback and Sell Tonight — tools which will be useful for both travelers and hoteliers. The products are currently available in test markets in the U.S. and will be gradually introduced on a global scale later this year. The products are latest features added to the hotel-facing tool suite called Expedia PartnerCentral (EPC).

Real Time Feedback’s target audience are mobile-savvy travelers. The product is designed on the basis of feedback from hoteliers who wished to gain more support from Expedia in securing positive hotel reviews. The real time interface sends an email or notification via mobile application to a guest, shortly after the guest checks into an Expedia.com-booked hotel. The email/notification contains three questions: “How was your check in?”; “How is your room?” and “Are you happy with the location?” Guests are encouraged to provide specific feedback, which are transmitted in real time to the hotelier via Expedia PartnerCentral. The hotelier gets the opportunity to act upon the feedback, thereby avoiding a potential negative trip review from the traveler later on.

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The other product, Sell Tonight (accessible via Expedia PartnerCentral), allows hoteliers to push out same day rates and availability to Expedia.com and Hotels.com customers, through the customers’ mobile applications. The product also informs hoteliers about the same day rates prevalent in their markets, hence making the hoteliers better equipped to compete and increase the same day bookings. Expedia’s investment in technology was to the tune of $650 million for twelve months ending September 30, 2014. [1]

We have a price estimate of $84 for Expedia’s stock, almost in line with its current market price.

See Our Complete Analysis for Expedia Here

Priceline’s Booking.com Launches Booking Now: Expanding Booking Options And Enhancing The Travel Experiences For Impromptu Travelers

On January 15, Priceline’s (NASDAQ: PCLN) accommodation site, Booking.com announced the launch of Booking Now-a mobile application that aims at providing a customized booking experience to its users, by utilizing user behavior data and GPS technology. The application is currently available for download in the U.S. in Apple’s App Store but will gradually be rolled out globally. The application platform will comprise of over 580,000 properties across the globe, and provide custom accommodation recommendations for spontaneous travelers wishing to book accommodations within 48 hours. Booking Now personalizes real time search results for travelers based on the profile they create on the website, with specific preferences such as desired price range and options like parking, breakfast and Wi-Fi. Booking Now suggestions can also be based on the user’s current street location anywhere in the world. [2]

Priceline would offer stiff competition to brands such as Hotel Tonight with its Booking Now. Hotel Tonight popularized the concept of same day bookings in 2010 and enjoyed huge growth ever since, along with a $80 million funding. Although, there were competitors who tried to gain market share, Hotel Tonight never before experienced competition from such a formidable adversary like Priceline. [3]

We have a price estimate of $1108 for Priceline’s stock, which is at a 10% premium to the current market price.

See Our Complete Analysis for Priceline Here

The application releases by the two online travel behemoths point towards the importance of quick-turnaround bookings, primarily completed on the mobile platform. Expedia and Priceline both seem to understand that the present day traveler needs to book services at a very short notice, and also, that the travelers expect the ubiquitous presence of the online travel agencies at every stage of the booking process and even thereafter. Hence, embracing these aspects are of crucial importance for gaining competitive edges in the market place.

Hence, some of the trends that will rule the online travel market in 2015 seem to emerge from these early application releases. These trends are discussed below:

  • The Future Of Online Travel Belongs To Mobile

According to Forrester Research, the market for mobile payments in the U.S. will expand from $52 billion in 2014 to $142 billion by 2019. Also, in terms of smartphone ownership, only 19% of U.S. consumers owned a smartphone in 2009. The percentage increased to 66% in 2014. [4] Hence, if we assume the majority of smartphone owners make mobile transactions, then such applications such as Booking Now and Sell Tonight become really crucial in expanding the user base and increasing the number of transactions for the online travel agencies.

  • Travelers and Hoteliers Alike Are Looking Forward To Quick Turnaround Products And Services

In this fast paced world, travel booking is not always a leisurely or planned process, wherein consumers book itineraries months in advance. Travelers are looking for hotels or flights just hours before their journey. On the other hand, there are hoteliers who want to offload excess inventory at the best possible prices. Hence, the online travel agencies are taking on the role of ‘matchmakers’: they’re matching both the demand and supply and in turn, increasing their own profitability.

  • Travelers Expect Seamless End-To-End Service From The Initiation Of Booking Till The End Of Their Journeys

The intense competition in the online travel space is good news for the customers, whereas for the online travel companies this implies that constant innovation and upgradation of services is the trick to stay ahead of competition. Users expect better service from the online travel agencies, and this includes a seamless end-to-end experience —  from the time they book travel related services until the completion of their journeys. Hence, an application like Real Time Feedback, gives the traveler the benefit of better services, and it also provides hotels the chance to avoid being negatively reviewed. Both the hoteliers and users are presented with a better travel and service experience.

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Notes:
  1. Expedia Innovates in Real Time with Launch of Real Time Feedback & Sell Tonight, expediainc.com, January 2015 []
  2. Booking.com Launches Booking Now, the First Truly Global App for Spontaneous Bookers, Booking.com, January 2015 []
  3. Skift Business Traveler: The Growth of Last Minute Hotel Bookings, Skift, January 2015 []
  4. Skift Megatrends 2015, Skift, January 2015 []