JOIN USHotels now offering rooms on hourly rent
In recent months, there’s been an increase in the number of platforms offering hourly hotel room packages. Customers can book a room on a pay-per-hour basis depending on their requirement.
While the concept instantly raises red flags, the founders of these aggregator sites clarify that it is mainly designed for business travellers and tourists. Despite the scepticism, the business model seems to have taken off. With flexible check-in timings, rooms at almost half the full rate, and options for booking on the go, industry insiders say they are seeing many takers.
Prateek Singh, co-founder and CEO of Brevistay, a website that offers 3-, 6- , and 12-hour stays, shares that Bengaluru is the second highest revenue generator for them. “The city sees a lot of business travellers and transit passengers,” shares Singh, adding, “It is ideal for professionals who have to fly into the city for a meeting and return to their home city the same day. For someone who needs a few hours to freshen up before heading into a meeting, this arrangement is convenient. Often, they end up paying the full price, when they actually need the room for just two to three hours.”
Currently, the site has more than 4,000 hotels across India on its roster. A majority are business or budget hotels, but a small percentage of premium hotels are also on the list.
Quality check
Singh reveals that his team has a set of parameters they look at before onboarding a hotel. Features like AC, WiFi, LED TV, cleanliness and location are taken into consideration. Nupur Singh is associate director of MiStay, a platform whose USP is slot-based booking (8–11 am, 12–7 pm, 8–7 am).
She shares that they make decisions based on factors like the hotel’s online presence, reviews, and location. “Our team also visits the hotel before we take a call,” she says.
Win-win situation
Industry experts, who Metrolife spoke to, believe that such a feature is beneficial to both customers and the businesses. The customers get a room at a fraction of the full price, while the hotels can sell the same room upwards of thrice a day. “Hotels generally run at 60-70 percent occupancy. This gives them the opportunity to be 100 percent occupied. It is not a major contributor but it certainly helps them optimise and generate extra revenue,” explains Nupur.
MiStay takes a commission of 20-25 percent, while Brevistay makes 15-20 percent off the sales. Bag2Bag, another aggregator, too makes a 20 percent commission. With bigger players like MakeMyTrip, Agoda and Booking now offering similar services, it is set to become a booming business, feels Alok Mishra, one of the co-founders of Bag2Bag. The company, which sees 40-50 bookings daily in Bengaluru, has developed a modified version of the widely used hotel booking software, Channel Manager. It allows properties to keep track of hour-based reservations.
“The original software tracks only regular bookings, which is one reason hotels were hesitant to sign up initially. What we have developed makes it easier to update their inventory, keep tabs on bookings and checkouts, etc,” he shares.
Quick business
Kiron Kumar, general manager of The Park, states that they keep 3-4 percent of their rooms for short stays. The property, which has tied up with MiStay, has a total of 109 rooms.
Business travellers form the majority of their pay-per-hour guests, but they also see individuals who are working from home opting for the service. “Maybe they want a change of scenery or a working staycation,” he reasons.
Howard Johnson has signed up with Brevistay, MiStay and Bag2Bag. Front office manager of the hotel, Thota Bhaskar, shares that while the room generates additional revenue, it also adds to the business of the food and beverage outlets and spa. But how do they check illegal activity? “We have standard procedures in place. We ask guests for valid government ID cards. If they don’t have it, they are not allowed to check in,” explains Bhaskar.
Both Kumar and Bhaskar have no qualms, but say that the challenge arises when rooms are sold out the previous night, and there’s an early check-in the following day.
Wallet factor
Depending on hours of stay, one can now avail rooms for almost 25% to 70% of the full rate.