Polish entrepreneur Mark Bradshaw claims hotels in the UK are being ‘bullied’ by the likes of Booking.com and Expedia, but his new booking platform, Bidroom, will ‘wipe the slate clean’ by being the first to offer a free-of-charge reverse auction model.
“We know the current system is unsustainable,” Bradshaw told BigHospitality. “It is becoming ever-complicated and baroque, with channel managers interconnected with booking sites, affiliates, aggregators and price comparison sites in a tangled web that serves no-one but the intermediates.
"It's absurd in this day and age that hotels and customers have allowed themselves to be bullied by these middlemen who basically add no value at all to the traveller.”
Video: Bidroom - How does it work?
Bidroom, which launched earlier this month and is currently available for hotels in London and Edinburgh, asks travellers to fill out the basic details of their stay, including the arrival and departure date and the number of rooms required. These details are then passed on to local hotels in real time, inviting them to provide their best offer and essentially bid against each other for the custom.
A fixed 24-hour countdown clock keeps hotels and customers focussed on reaching a deal. The prices are normally lower than those offered through the big booking websites, hotels will receive direct bookings, and no commission is charged.
So how will Bidroom.com make money if it’s free? “First of all, remember that Bidroom is a platform rather than a typical travel or booking agency,” added Bradshaw. “The running costs of such a business will always be significantly lower than, for example, booking.com.
“We prefer to aim for a small group of smart people to keep costs low. In the future, we would consider following the lead of services like Gmail, Skype or Facebook, whereby small advertisements run alongside the content or the webpages. But the core service will always remain free.”
Seize the opportunity
OTAs have grown their presence considerably over the past 10 years. While the majority of hoteliers recognise that they have marketing benefits and are a key way to fill rooms, the participants of a recent round-table discussion organised by NatWest and BigHospitality said they were being forced to pay high commission rates and not benefiting from the loyalty they’d receive from direct bookings.
Bradshaw, who is also behind travel advisory service Local Life and founded Bidroom with hotel marketers Michael Ros and Casper Knieriem, understands it will be a challenge to compete in such a busy online marketplace, but he is relying on hotels and customers to ‘seize this opportunity’ and shake-up the existing punitive booking model.
“If hotels offer prices through bidroom that are, for example, 10 percent cheaper than booking.com, both hotels and customers will be better off - and bidroom as an independent platform for hotels will grow,” he said.
“We are confident that this is the right time for a real shake-up that will ultimately benefit hotels and customers.”