At the World Travel
Market in London, eTN Publisher urgen Steinmetz spoke with the founders of the online
booking platform, Bidroom.com, as they announced changes to their business
model. The Hague-based company will no longer charge commission from hotels and
apartments, meaning that they can be registered and receive bookings completely
for free.
“In our first years on
the OTA market, we were charging 2% commission – much lower rate than any other
booking platform” – Bidroom’s CEO, Michael Ros says. “Thanks to the lower
commission, hoteliers were able to give a discount to the guests, making it
beneficial for all three sides.”
The startup claims to
be bringing fairness to the OTA market. They advertised their low commission
rate as a stance against the bad practices of the major booking websites, like
high commissions and brand hijacking. Now, Bidroom.com has decided to give up
on the traditional commission model.
“Even though our
commission rate was the lowest on the market, it was still troublesome for some
hoteliers to pay it upfront by purchasing Bidroom Credits, from which the
commission was later deducted” – admits Casper Knieriem, CFO at Bidroom.com.
“So we came up with the idea to change our business model. Commission is an
outdated concept. We decided to welcome every hotel, vacation rental and
B&B for free, and allow them to receive free bookings, as we continue
revolutionizing the market.”
Obviously, by
abandoning the commission model, the platform had to find another way to make
profit. Ros and Knieriem hope the newly introduced Bidroom Plus plan will keep
the company profitable. Bidroom Plus is a subscription package that is intended
to help hotels get more bookings.
“Bidroom Plus is an
upgrade over Bidroom Free, as it allows managers to add more information about
their accommodation. With the Plus plan, their hotel or apartment gets a
dedicated page on our platform, where the users can see the pictures, learn
about the offered amenities, and book rooms. The dedicated page allows users to
directly search for their favorite accommodation, instead of looking for any
place to stay in the city they want to visit” – Ros explains.
But Bidroom Plus is
much more than that. The subscribers of this plan will have their accommodation
appear higher in the search results. It also enables them to connect
Bidroom.com with the channel manager software. Additionally, they can have a
button leading to their own accommodation website, installed by their
hotel/apartment name on Bidroom.
“It’s not a secret
that people want to know as much as they can, about their accommodation, before
they book it. So, often they google it, and end up on the website of one of the
major OTAs, because they outbid the hotels and apartments, and appear higher in
the search engine results. Once they’re there, they may decide to book, making
the manager pay up to 25% commission to the platform. With the link to their
website installed on Bidroom.com, the users won’t have to google the
accommodation, and this drives direct bookings” – Ros says.
With the introduction
of the commission-free bookings, the platform’s website also received an
upgrade, as Bidroom.com can now be browsed in multiple languages: English,
Dutch, French, Polish, and Russian.
So far, Bidroom.com
has more than 200,000 active users, and is nearing 15,000 hotels.
“Right now, with our
new business model, it’s a no risk, high reward situation for accommodation
managers. With the entire team in our offices in The Hague and in Cracow, we
couldn’t be more excited for the things to come” – states Knieriem.
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