Suite 999: Welcomed Disruption to Hotel Bookings

SUITE 999: DISRUPTING THE ONLINE HOTEL INDUSTRY

Wednesday, August 3, 11

BARRIERS TO INNOVATION

• Franchised hotels don’t have total control on pricing and promotions

•Most hotels want a choice but are forced to work with the rules imposed by hotels chains, distributors and discounters such as Priceline

•Startups looking to disrupt the industry are faced with the same challenges and most don’t even understand them


BARRIERS


GDS BARRIER:GLOBAL DISTRIBUTION SYSTEM

• Holds a virtual monopoly on bookings from all major travel sites such as Expedia, Travelocity, Orbitz and travel agents

• Allows access to hotel inventory & pricing

• Hotels pay a fee for every room booked in addition to commissions

• Example: on a $100 booking, a hotel pays $10 in commissions and $5 in GDS fees


LOWEST INTERNET RATE GUARANTEE BARRIER

• Hotel Chains have imposed rules so that the rate for a room at a particular hotel is the same across all websites

• They don’t want external sites to show rates lower than brand sites

• Example: Orbitz, Expedia, Travelocity

• Priceline and Hotwire are exempt because the name of the hotel is not known until paid for by the guest


TPI BARRIER:THIRD PARTY INTERMEDIARIES

“DISCOUNTERS”

•Massive discounter of rooms which is disliked by both individual hotels & chains because they erode value & set arbitrary pricing

•Discounted rates are offered because the names of the hotel is unknown until the transaction is completed


TPI “DISCOUNTERS”

• Hotels often have to discount 50% or more just to stay in the game. Hotwire or Priceline adds their profit on top to come up with the rate

• Example: $100 room must be discounted to Hotwire for $50, which then sells the room for $75. Hotels don’t like that they can’t control the rate given to guests and Hotwire making such a large profit on the transaction

• By being able to list unpublished rates, hotels are allowed to maintain rate integrity or “keep up appearances”

• Example: An upscale hotel may offer a discounted rate to Priceline at $75, but will continue to only show a published rate of $150 across major websites

• The hotel doesn’t have a choice to offer a lower advertised rates on different websites because of....


HOTEL CHAINS ARE BARRIERS

•Chains created the lowest internet rate guarantee

• They enforce it through their property management systems

• They are forced to continue working with discounters such as Priceline and view it as a necessary evil


HOTELS ARE STUCK

•They can show a publicly available rate which is the same across all sites because of the Lowest Internet Rate Guarantee

• If they wish to discount, its only through massive discounters such as Priceline and Hotwire


HOTELS ARE STUCK

•They would welcome another option which would give them control, flexibility in their pricing and distribution


SUITE 999: WELCOMED DISRUPTION


SUITE 999: MOBILE. SOCIAL. ONE TO ONE.


SUITE 999: MOBILE. SOCIAL. ONE TO ONE.

•Suite 999 bypasses the GDS and their fees

•Suite 999 does not violate the lowest internet rate guarantee

•Suite 999 allows hotels to individually chose what discounts to give and when to give them

•Suite 999 allows guest to pick their hotels and still receive a large unpublished discount


SOCIAL & FUN

• Facebook Connect is the default sign-in application

•Guests receive receive credits for referrals to their friends who also receive credits for signing up

•Guests are rewarded for posting offers to walls, checkins & likes

•Gamification of the entire Hotel Booking Experience

•Ongoing demographic marketing based on checkins in various cities


SUITE 999 TEAM

•Rahim Kassam and Alim Haji are both second generation hotel owners and managers who understand the industry and see a need for a new solution.


SUITE 999: WELCOMED DISRUPTION FOR THE HOTEL INDUSTRY

MOBILE. SOCIAL. FUN.Wednesday, August 3, 11

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Suite 999: Welcomed Disruption to Hotel Bookings

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