In an effort to bridge the wide gap between hotel supply and demand in India, FindMyStay has launched a bidding platform that enables hoteliers to offer discounts.
The India-based company launched its service two months back where users can select a destination, checkin/out dates, star rating, and enter a price range that they are willing to pay for the hotel stay.
Once the bid is submitted by user, FindMyStay processes the request, works with the hotel and sends either a big acceptance or rejection email to the customer. This entire process takes about 60 minutes, though in two of my test booking (bidding) experiences I got the acceptance email in about five minutes.
FindMyStay was founded by Simran Sial and Rohit Kheterpal with a focus of making online hotel booking easier, simpler and better for the customers.
Being avid travellers, the founders realised a void in the hotel booking market. The supply of hotels is increasing year-on-year in India but the demand is not keeping pace with it, leading to an average of 40-50% occupancy rate, says Sial.
Sial adds:
"Customers, on the other hand always want a good hotel, but the budget is more often than not a big hindrance.
"So, we launched findmystay.com with our unique reverse bidding feature called ‘Find My Stay @ My Price’ that allows customers to bid for lower hotel rates and on the other hand helps hotels sell their perishable inventory and boost up their occupancy."
The startup achieves this by enabling online negotiation between the customer and the hotel, where a user offers his/her best price to the hotels and not the other way around.
Hotels can either choose to accept or reject the offer. In this process, the customer ends up saving more than any other hotel deal online and the hotel gets a customer for its unsold inventory, claims Sial.
Vine video about FindMyStay
Q&A with Sial:
Size of the team, names of founders, management roles and key personnel?
We have a small and competent team of about 15 in New Delhi (India) across various verticals – Product, technology, sales, backend, marketing, etc.
Going forward, we will expand this team not just in Delhi but in other key locations in India as well.
Funding arrangements?
So far the project is boot strapped. We haven’t really looked out for external investment till now, as our focus has been execution. We went live two months ago and our customers have shown a very positive response.
We will continue to invest further in technology, however, we believe that equity backed businesses grow faster and also bring in additional vision and experience into the Business.
Lately, we have also been approached by a few venture capitalists who have shown interest in the business model.
Estimation of market size?
Overall the online travel market is about $7 billion in India which is about 40% of the offline bookings. Daily there are about 200,000 room nights available to be sold in India out of which the demand is only for about 40% rooms.
Competition?
Findmystay.com is one of its kind in India in terms of our business model and services. But, in the end, we are competing with the likes of Makemytrip, Yatra, Goibibo, Cleartip, Agoda, Booking, Expedia and others in the online travel domain.
Revenue model and strategy for profitability?
We have been working for the past two years before we went live and we took this time to build relationships with our hotel partners.
We will be charging hotels commission percentage for every room night we book for them. Unlike our competitors who are willing to pay money for customer acquisition in the name of discounts, our strategy is to acquire and retain customers with the help of innovation, product differentiation and user experience.
What problem does the business solve?
"Find My Stay @ My Price", a unique model that empowers customers to decide what they want to pay for their stay, the model is unlike any other OTA.
Customer is the king, along with destination, location, dates, and star category of the hotel customer also selects the price they wish to pay for their stay.
Within 10-15 minutes (even though we mention maximum 60 minutes) they get various hotel options in their inbox with complete details of the hotel and a price which can be 20-40% lower than online price of those hotels.
How did the initial idea evolve and were there changes/any pivots along the way in the early stages?
The idea evolved due to the pain witnessed by us while booking hotel stay for ourselves. And then we got together, thought and came up with a better way of booking a hotel stay.
Why should people or companies use the business?
People should book hotels through us because:
- People can save money on hotels through our unique model; find my stay @ my price, where customers can bid for their hotel stay and thereby getting great hotel deals exclusively for them.
- With our hotel search feature (to be launched soon), people can book quicker with our new user interface.
What is the strategy for raising awareness and the customer/user acquisition (apart from PR)?We are active on SEM, SEO, social, display and email Marketing. We plan to do some out-of-home (OOH) and print advertising very soon.
Where do you see the company in three years time and what specific challenges do you anticipate having to overcome?
The travel industry's contribution to capital investment in India is projected to grow at 6.5% per annum during 2013-2023, above the global average of 5%.
The total market size of Indian tourism and hospitality sector is expected to touch $419 billion by 2022. These figures speak volumes about the way the market will perform in the coming years and its great potential in the future.
The challenge is that it’s a cluttered space with a lot of players and customers are used to booking with them. So, creating an impact is not that easy. We are building our own niche and brand recall will happen gradually.
Another challenge is that people still have some phobia for online transaction, and being a new player, building up their confidence takes time.
What is wrong with the travel, tourism and hospitality industry that requires another startup to help it out?
It is the gap in demand and supply. The supply is increasing but the demand is not increasing at the same pace. So, our bidding product helps bridge that gap.
What other technology company would you consider yourselves most closely aligned to in terms of culture and style... and why?
We are the first ones doing it in India. In the US, Priceline offers reverse auction however its an opaque system and requires you to park payment details upfront and customer pays even before he gets to know which hotel it is.
Similar service has been started by Stayful in the US for select niche boutique hotels in select cities.
In our case, there is no upfront payment and customer gets multiple options to choose from and not just one.
Tnooz view
This Priceline-styled hotel bidding service is a boon to India, both for consumers and hoteliers. Domestic hotel brands are expanding their presence, and international brands are both launching and expanding in India.
According to a recent STR Global Construction Pipeline report, number of hotels in pipeline in the Asia Pacific region totals to 2,171 hotels with 481,564 rooms.
All of these are a positive development for the startup that wants to expand its service outside India, to begin with, it will be the South East Asian market.
In my two test bidding process in FindMyStay (one for a hotel in Bangalore, another in Shimla) - both my bids were accepted with a price that is about $35 (2,000 INR) cheaper than other OTAs for same hotels. Now, that's a real value add, with about 30% saving in cost.
Unlike Priceline where a user has to enter card details before even knowing the hotel name, FindMyStay sends up to five hotel options to users via email. Then, user can select a hotel of their choice and proceed with booking. This transparency process is going to be valued by users.
The startup pose a real threat to all online hotel booking service providers, including the OTAs. Since the core differentiation of the startup is its lowest price promise, and India being a price sensitive market, FindMyStay has good scope for growth.