Blockchain-Based Hotel Booking Platforms
involves hotel bookings. The role of online travel agencies (OTAs), such as
Travelocity and Priceline, in facilitating hotel reservations has steadily increased in recent years.
to understand why: OTAs make it easy for consumers to shop a range of hotels in
a given location and find the best price. They sometimes offer other advantages
as well, such as the ability to bundle related services with a hotel
reservation and receive a discount.
hotels, however, this trend is a problem. OTAs typically charge hotels commissions of 15 to 20 percent when
customers use their websites to make reservations, significantly reducing
hotels’ revenue. And while OTAs often feel like a benefit to consumers, the
commissions indirectly harm them, too, by pushing hotels to raise prices in
order to offset commissions fees.
technology can help to solve this problem in two ways. Firstly and most
significantly, blockchain technology could form the foundation for a
decentralized platform that connects consumers to hotels without requiring
large commission fees.
the solution envisioned by startups like Concierge.io, which uses the NEO blockchain
as the backbone of a commission-free hotel booking platform. The company says
that its solution will save consumers as much as 45 percent on traditional
booking fees. For now, Concierge.io remains in development. Only hotels based
in Vietnam are currently available for booking, but the company says that it
will eventually list 10,000 international properties.
LockTrip is building a similar platform, with plans to roll out its
decentralized applications in the spring of 2018.
secondary benefit of blockchain-based booking systems is that they can
eliminate or significantly reduce payment transaction fees by allowing
consumers to pay with cryptocurrencies. While transaction fees for credit and
debit card payments do not contribute as significantly to online hotel booking
costs as OTA commissions do, they are still a factor.
Transparency and Hotel Reviews Via the Blockchain
significant challenge facing hotels and consumers is fake or unfair online
hotel reviews. Given that, on most online review platforms, anyone can write a
review of a hotel without having to confirm that he or she even stayed there,
it is difficult for consumers to know how accurate online reviews are. For hotels,
meanwhile, inaccurate or unfair reviews can be hard to identify and address.
of blockchain-based online review platforms with the potential to address this
challenge, such as Revain
and Lina.review, already exist. These review sites, which use blockchains
to improve the transparency and reliability of online reviews, don’t cater to
hotels in particular, but hotel reviews are an obvious use case for their
providing a more reliable place for online hotel reviews than the sites run by
OTAs, these review platforms would further reduce the need for consumers and
hotels to rely on centralized booking sites in order to locate each other.
Blockchain-Based Dispute Resolution
challenge that blockchain platforms can help to address is that of disputes
between hotels and guests.
if guests arrive at a hotel and find that the room they have booked is not what
was advertised — or, worse, that it doesn’t exist at all due to fraud or
overbooking by the hotel — they have little means of redress, especially if
they prepaid for their reservation. Similarly, the ability of hotels to recoup
losses for damages caused by unruly guests is limited. They can require guests
to register a credit card when they check in to cover possible damages, but
credit limits, credit card fraud and other issues make this solution less than
to imagine an alternative where hotel bookings are moved to the blockchain and
disputes are resolved automatically via smart contracts. While such a solution
is not yet a major part of existing blockchain-based hotel reservation
platforms, startups like Concierge.io have plans to make use of smart contracts
for this purpose.
contracts could potentially streamline other aspects of the hotel experience,
too. They could automate check-in and check-out procedures, and perhaps allow
guests to check in at different times, rather than having to wait until an
official, hotel-wide check-in time. They might even be used to guarantee the
best price on a hotel room, regardless of when or where it was booked, by
determining what other guests are paying.
implementation of blockchain-based platforms for hotel bookings, reviews and
dispute resolution has been limited to date, several startups are working on
such solutions. Blockchain technology may prove as disruptive to the hotel
industry over the next couple of decades as was the advent of online booking
sites in the 1990s.