We're in the middle of vacation season, so this month we look at a couple of tools in the short-term lodging space. Both are important, as they affect your clients either directly or indirectly, so you'll want to have a working knowledge of this topic. Clients may not ask for your advice in this area, but you will certainly impress them if or when you're able to introduce and speak intelligently on it.
AIRBNB: WHAT YOU NEED TO KNOW
In less than 10 years, Airbnb has become a billion-dollar company that boasts in excess of 3 million lodging listings in more than 191 countries. It has materially changed the travel and hospitality industry, but not everyone is happy about that. The hotel industry, local government regulators, and neighbors worried about strangers staying next door have raised concerns. Objections aside, you'll want to be familiar with Airbnb.
Searching for a rental on Airbnb is easy, and the listings are informative. Each listing details spaces, locations, prices, amenities, availability, and reviews, and, usually, includes multiple photos. The listing also shows a map with the property's exact location. The real magic is the "crowd-sourced challenge and response" system. The company uses double reviews (each party reviews the other) to automatically curate and rank properties and guests. This "secret sauce" requires attention be paid to both sides of the transaction. Airbnb succeeds only when a solid product (i.e., the room) is delivered to an equally solid customer (i.e., the renter). This balancing act results in occasional mediations, but it also positions the company as the "middleman" eagerly collecting a percentage of every transaction. This means that listings of Airbnb rooms remain reliable as the guest and hosts must verify their official ID and personal details. The platform also provides a messaging service so guests and hosts can talk to each other to confirm their identity and the rental's amenities. Payment via Airbnb is reasonably secure, as money is transferred between hosts and guests through its payment system, with Airbnb acting as the custodian and arbitrator. The company collects only when a room is booked and paid for. The 3% fee is subtracted in the cash transfer process.
- Website: airbnb.com
- Pricing: App is free; company collects 3% of payment from renter to property owner
- Operating systems: iOS, Android, Web
HAVE HOTELS FIGHT FOR YOUR RESERVATION ON BACKBID
BackBid was born to be a technological "second opinion" for your already booked hotel room. You book a refundable reservation at a hotel in the area to which you are traveling. You then provide the details to BackBid, which invites other hotels to bid on the booking. If another hotel offers a better deal, you take it and cancel your original reservation. (Note that it's your responsibility to cancel the original reservation. The platform does not do it.) In other words, you provide the when and where, and the hoteliers bid for your business. Perfect.
When posting a request, you'll be asked for relevant reservation data, including the hotel you've booked and the confirmation number. If you have not made a reservation yet, simply select the "No" button in the "Do you have a reservation?" section. I've automated the process by linking my TripIt account to BackBid, so every hotel reservation I make gets automatically submitted to BackBid (for more on TripIt, see the July 2015 Expanding Your App-titude, "Avoid Travel Stumbles With TripIt").
Think of BackBid as the Priceline model flipped on its head. With Priceline, the customer offers to pay $X for a hotel room. With BackBid, the hotel offers to rent a room for $X. Note that both models require upfront payment: Priceline when a hotel accepts your bid, and BackBid when you accept a hotel's offer. At those points, your payment is nonrefundable.
- Website: backbid.com
- Pricing: Free to customer; hotels pay varied fees
- Operating systems: BackBid is an app accessible through web browsers on computers and mobile devices.
Greg LaFollette (email@example.com) is a strategic adviser with CPA.com, the commercial subsidiary of the AICPA.