December
11
2012
12
3

Blog Blog

By Christopher Patridge

BackBid continues to stir the pot!

When BackBid launched early this year, there was a ripple, no, more of a wave of controversy that ran quickly through the hotel industry. We are happy to say, the controversy still continues today. This “tug of war” of opinions was between the hotels, who were wary and the online community, who were excited at a new concept that was all about consumer empowerment.

Here are some highlights of the chatter about BackBid:

  • Even before the site launched publicly, a hotel chain sent an email to all of its properties stating that BackBid “will have a negative impact on the hotel industry as a whole, and will only push rates down by creating a negative spiral effect in which hotels continuously underprice each other.”

  • During a price optimization webinar in November 2011, Chris Anderson, professor at Cornell University, said that he was “fascinated” by BackBid.

  • In December 2011, Arthur Frommer called BackBid "a remarkable new website…a win-win proposition for consumers", and concluded that the "ingenuity of online entrepreneurs is a marvel to behold!"

  • In March 2012, Vijay Dandapani, COO and part-founder of Manhattan’s Apple Core Hotels said: “Backbid's bookings are non-refundable and likely will go a long way towards addressing booking decay, a long time bane of revenue managers.”

  • In June 2012, hotel industry experts at an HSMAI workshop discussed the pros and cons of BackBid and decided: "At its best… Backbid allows them to possibly unload inventory at a low yield. At its worst, [BackBid] encourages a downward spiral, with competitors outbidding each other with lower and lower rates."

  • In August 2012, Jay Hubbs, VP of Regional Sales for ReviewPro, commented: "BackBid… does provide some benefits for hotels… For one, it’s a good way to sell distressed inventory. It’s also a good way to secure business by offering additional value—not by discounting."

  • Travel + Leisure Magazine named BackBid one of their top travel websites in the September 2012 issue.

So, it is clear that consumer advocates are firmly behind us, the industry, well, not always, but our partners are seeing the benefits from the qualified demand we deliver. The BackBid controversy has a lot to do with changes that the site has had on the consumer booking process and hotel operations. In the past, making a reservation was the end of the booking cycle. BackBid is now the second phase of the booking cycle: leveraging the ever-changing rates in the destination and delivering competitive bids up until the check-in date, to ensure that the traveler is able to get the best rate/value. This gives travelers the ability to control their costs, offsetting the 4% global increase in hotel prices that we've seen already this year.

As BackBid is nearing its one-year anniversary and as the debate about BackBid’s effect on the industry continues, feel free to chime in. Let us know how BackBid has helped you secure the best hotel for the best price.

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