Here comes the start of last-minute mobile hotel bookings in India, a trend which SavvyMob hopes to spearhead.
The Bangalore-based startup was founded in April this year by Bikram S Sohal (CEO and co-founder) and Gappan Annamalai (COO).
SavvyMob's service is similar to the likes of HotelTonight, Hot Hotels, and HotelQuickly, but SavvyMob's target customer segment are the millennial travellers.
"The hospitality industry in India is transforming rapidly, new hotels are launching every month and global brands are making large investments. This is resulting in a supply and demand imbalance causing the occupancy rates of hotels to dip, thus putting pressure on their overall margins", says Sohal.
Sohal sensed this opportunity and launched a mobile-based solution for hotels to sell their distressed inventory and increase revenue.
The company is self funded so far, and it is looking for early stage investors.
Currently, SavvyMob is available on Android and iOS platforms, and in the platform it has 125+ hotels sourced from 15+ cities.
Q&A with Sohal below.
Size of the team, names of founders, management roles and key personnel?
We have a very small team trying to do big things.
I started my professional career as a Product Manager in the dotcom boom'n'bust times in the US. Since then I've been working in the digital technology industry in startups or similar type roles in corporates. Finally, I decided to go on my own with SavvyMob after my last role as the General Manager for CNN Travel in Hong Kong.
SavvyMob is our (Sohal + Annamalai) second innings working together, we were earlier at Aol where we were responsible for expanding Aol and it’s brands like Winamp, AIM, Engadget, Autoblog across Asia.
Between the two of us and our technology guru, developer, and sales champion - Abhijit - we are working relentlessly to disrupt the mobile travel booking industry.
Let’s also not forget our interns across the country who are tirelessly helping turn our dreams into reality.
Estimation of market size?
We are building travel products for the millennials, a 300 million+ target user base in India. Our market is the mobile travel booking and advertising market which is growing at a double-digit clip and expected to reach $400 million+ by 2017.
Competition?
We are an early mover in the nascent mobile travel booking market and our product and pricing strategy further creates the competitive differentiation for us.
The top three OTAs in India - MakeMyTrip, Cleartrip and Yatra - dominate the online travel booking market, however, they don’t have a competitive last minute hotel booking solution. They are traditional web based businesses, we are a mobile first company targeting the savvy millennial last minute traveller, both business and leisure.
Revenue model and strategy for profitability?
Our business model has two revenue streams:
- Transaction revenue (commissions)
- Advertising revenue (CPM/CPC/CPA)
What problem does the business solve?There is an oversupply issue of hotel rooms in India and a growing customer base of young tech savvy travellers. SavvyMob is creating a mobile marketplace that offers this excess inventory to the traveller at a highly competitive rate, a win-win-win solution for all. We are also enabling the hotels to:
- Target the new wave of millennial travellers
- Improve revenue metrics by optimizing inventory sales
- Retain customers by higher customer engagement within the property
- Embrace new technologies
How did the initial idea evolve and were there changes/any pivots along the way in the early stages?The idea has gone through numerous iterations from inception to going live. We are constantly evolving based on data and market feedback.
Why should people or companies use the business?
We are building products for the millennial travellers who are social, tech dependent, price conscious and want the best value at the lowest cost.
We are focused on building products that delivers value at an attractive cost for our users over the next few years.
Hotels, as mentioned earlier, use us to sell their last minute distressed inventory. Additionally, we give them data and insights from our analytics platform to help increase customer engagement and loyalty.
What is the strategy for raising awareness and the customer/user acquisition (apart from PR)?
We are currently acquiring consumers through incentivized referrals, word-of-mouth advertising and social media marketing. Over the long term, we will scale by building a distribution ecosystem through alliances and partnerships. We are also working on a secret recipe for acquisition, wait for a few months.
What is wrong with the travel, tourism and hospitality industry that requires another startup to help it out?
It’s not a question of things being wrong with an industry, it’s all about disruption and innovation. The hospitality industry in India is fragmented and manages its last minute unsold inventory in an ad-hoc manner.
Consumer buying habits are changing with the disruption caused by smartphone adoption and growth. We are listening to the consumers and developing new mobile distribution products that connect them to the hoteliers in an organized manner.
What other technology company would you consider yourselves most closely aligned to in terms of culture and style... and why?
We are travel enthusiasts, we are risk takers and we like to have fun, at work and outside work. We have our own ‘Savvy’ culture with a dash of influence from our Aol days.
Tnooz view
Finally, companies like SavvyMob that focus only on the last-minute hotel booking segment are emerging in India.
While there are quite a lot of companies in the US and Europe that have the same model, and there are a few companies in APAC doing the same, there were hardly any players in India addressing the issue.
It's a common question over the past few years there are no HotelTonight-type brands in the country.
As SavvyMob rightly points out, there is an imbalance between supply (hotel rooms) and demand in India, so solutions like these are going to be welcomed by customers and hotels. Companies such as MakeMyTrip's recent shift in focus towards hotels and packages business speaks about the hotel booking opportunity in India.
Though the leading Indian OTAs have similar functionality - Cleartrip's Quick Keys, MakeMyTrip's "last minute deals" section - it's encouraging to see startups also want to attempt to make their mark (elsewhere around the world it has primarily been the other way round, with larger brands mimicking the newbies).
Companies similar to SavvyMob will no doubt emerge in the next 12-18 months, with at least four different teams of professionals planning to launch a last minute hotel booking solution for India in the coming months.
B2B players, such as hotel technology provider IDSNext, are also toying with the model - the company recently launched a mobile-based last minute hotel booking solution, Roomstonite.
Vine video about SavvyMob