Internet has become an integral part of consumer’s life and before online shopping became more mainstream, travel triggered the e-commerce boom in India. Companies like MakeMyTrip, Cleartrip, Yatra are some of the prominent players in the Online Travel Aggregator (OTA) segment. These companies are the pioneers in the Horizontal Travel Segment and are online travel agencies that enable customers booking of flight, hotels, tours, recreational activities etc. There are other players like OYO Rooms, WudStay, Treebo Hotels, Vista Rooms etc. that are a part of the Online Budget Segment and act as enablers for hotel discovery and rentals.
Credit to the rising internet penetration, the online hotel booking sector is rapidly growing and is set to become USD 1.8 bn in 2016. There is a significant headroom for growth in the sector, with the ease of access to information and details online propelling consumer confidence to book hotels online [Source*].
The Opportunity – Last minute hotel deals
Though the hospitality industry is growing at a burgeoning speed with new hotels being launched every month, global investments being made; there is still a huge imbalance in the demand-supply cycle. Due to excess supply of hotel rooms inventory, an average of 40% of hotel rooms are unsold in India.
As Budget accommodation is fastest growing segment in India, most of the Online Travel Aggregators are looking at grabbing a piece of the market share [Source*]. However, this also involves an overhead cost of property inspection, standardisation, training hotel staff etc. Hence, there is still lot of room for disruption in the last minute 3*, 4* & 5* hotel booking space, as there are no very few startups that service the needs of the millennial , SME & Corporate travellers. Be it business trip, personal trip; travel can be impulsive and customers would look out for last minute hotel deals.
This is where Mumbai based Last Minute Keys sensed an opportunity and wanted to provide a platform for travellers so that they do not loose out of ‘Deals’ for un-planned trips and for Hotels so that they can liquidate their inventory for today, tomorrow and day after on a real time basis, which is not available with other OTA’s
Last Minute Keys has partnered with quality 3*, 4* & 5* hotels thus ensuring that there are low no overhead costs since these top-rated quality hotels already maintain high standards!
Let’s have look into Last Minute Keys’s differentiators, market size, funding plans etc.
Last Minute Keys – Presence and Key differentiators
As mentioned earlier, Last Minute Keys is dynamic platform for hotels to liquidate their inventory for today, tomorrow & day after on a real time basis. Customers can only do the booking three days prior to their travel and enjoy awesome savings on last minute booking.
Unlike the other last minute players in the market that have either integrated API’s of other online portals & have merely just positioned themselves as last minute players, Last Minute Keys have one on one contracts with each and every hotel that are listed listed on their platform.
Currently Last Minute Keys has tied up with more than 400 hotels in 12 cities (Mumbai, Delhi, Gurgaon, Noida, Jaipur, Bangalore, Hyderabad, Pune, Ahmedabad, Vadodara, Cochin & Goa) & plans to expand to 1000 hotels in over 25 cities in India in a short span of time.
Last Minute Keys – Key benefits for Hoteliers and Customers
Hoteliers: There is a huge demand-supply gap in the hospitality industry due to which at times there would be huge unsold inventory particularly in off seasons. Hotels would be open to offer rooms at a discounted rate in order to minimize losses by increasing the overall occupancy ratio.
Last Minute Keys offers the hotels a cutting edge extra-net platform, through which the hoteliers are able liquidate their last minute inventory dynamically based on supply & demand.
Customers: Last Minute Keys offers guaranteed lowest prices to their customers for last minute bookings (bookings over next 72 hours) as the platform only lists deals offered by hotels for their unsold inventory, which are the sold at rock bottom rates.
Hotel rooms are perishable in nature, hence any unsold rooms sold through the hotels on Last Minute Keys platform is additional revenue for them, customers on the other hand, land up getting a great deal at the last minute, hence making it a win-win situation for all.
Last Minute Keys – The team
Last Minute Keys team comprises of veterans that bring in tremendous experience from the Travel & Tourism Space and also have close knit relationships with hoteliers throughout India as well as International hotel chains. They have deep rooted understanding of the nitty-gritties of the hospitality industry.
Manoj Gursahani, Co-founder & CEO: He has over 3 decades of experience in the Travel & Hospitality segment and has a complete 360 degree understanding of how the dynamics of the Industry works including e-commerce, MICE segment etc. Read more about Manoj here
Mahesh Shirodkar, Co-founder: He is the Managing Director of Tamarind Global, one of the largest hotel room consolidators in India. Read more about Mahesh here
Naveen Varadharajan, Co-founder: He is spearheading and overseeing the technology innovations at Last Minute Keys. He also heads the InsatiableGroup and BOB Tech Solutions as Director & CEO. Read more about Naveen here
Last Minute Keys – Technology
It is a mobile-only travel marketplace and it is currently present on the Play Store. Customers can book a last minute discounted room in just a few taps on their mobile. The hotels present on their platform are hand-picked and have excellent ratings on TripAdvisor which is a seal of Quality Guaranteed.
In contrast to other online travel agencies and travel marketplace, prices displayed on Last Minute Keys are Final Prices (with no hidden charges).
Last Minute Keys – Marketing
The team at Last Minute Keys believes that a good product can speak for itself. They are relying on good customer reviews and ensuring that the customer gets an awesome stay at the best price! They are now marketing the product via Digital Media so that they can reach to potential customers.
Last Minute Keys – Funding
Last Minute Keys is currently self funded and is looking to raise funds for further expansion. Post funding, they plan to launch Last Minute Keys for B2B market segment. There is also a plan to have a Day Room Use & Night Room Use Tariffs integrated in all their platforms (existing & forthcoming)
As per Traxcn, USD 8 bn has been globally invested in online travel in 2015~16 with Horizontal and Accommodation being the top funded sectors [Source*]
Last Minute Keys – Scaling up and Customer Acquisition
Travellers can book hotel-rooms via the Last Minute Keys app. Since their potential partners are boutique and premium hotels, an iOS app would be a must-have for further customer acquisition.
There is a plan to cater to the B2B segment with the following offerings:
Travel agents: Last Minute Keys plans to offer web based platform to Travel agents, along with offering attractive commissions as a major chunk of hotel rooms are still sold through the travel agents. Hence, it is very critical to have a Travel agent facing platform as well in order to increase the conversion rates.
SME’s/Corporates: A tailor-made solution for HR’s of Small & Medium Enterprises (SME) as well as large corporates. Attractive loyalty programs would be a major playing factor in the corporate ‘Customer Segment’
In our opinion, since most of the SME’s & large Corporates manage their employees’ travel through their Travel Desk (or Corporate Travel Agencies), last minute Lead Generation for corporate travel agencies could also be a model to explore!
Last Minute Keys – Expansion Plans
Many of the impulsive travellers might require a stay only for a day, Last Minute Keys plans to introduce Day & Night use Room Tariff’s where customer can book a hotel room for minimum period of 10 hours (10 am~7 pm or 9 pm~8 am).
Other future plans are Tie-up with international last minute hotel players via API integrations. This would be a win-win situation for both the parties since international last minute deal companies can enter the Indian market & service their Indian customers whereas Last Minute Keys can expand its services to more than 300 cities worldwide! Selling last minute hotel deals on e-commerce websites is another area that is to be explored.
Since travel does not only involve stay, hence it is important to address all the touch-points that deal with unplanned & impulsive travellers. Hence, they also plan to tie-up with Taxi Aggregators in order to ease their journey.
Last Minute Keys – Competition
Better pricing strategy is definitely a key USP for Last Minute Keys. Though online travel sites like MakeMyTrip (via its Last minute deals), ClearTrip (via Quick keys), Yatra etc. also cater to the impulsive traveller but that is not their key area of focus.
The Last Minute Keys team consistently monitor rates & maintain rate comparative analysis with other OTA’s. At times they offer deals that are more than 50% cheaper than their competitors. There is definitely a huge rate advantage, since it gets great deals from hotels, as hotels sell their unsold inventory at rock bottom rates on their platform.
Last Minute Keys – Conclusion
Be it individuals or corporates, there is a definite need to cater to the impulsive travellers even though it is still in it’s nascent stage. With their B2B plan, Last Minute Keys has a clear winner in terms of addressing the requirements of the corporate travel segment.
Plan a little less, live a little more. Be spontaneous! Use Last Minute Keys