BOOKING LOCAL, GROWING GLOBAL
Fredrik Jansson created HotelSpecials in 2003. Now his hotel-booking platform has grown to offer hotel deals for more than 5000 hotels in 6 European countries (Norway, Germany, Belgium, The Netherlands, Sweden and Denmark).
In this article, he explains how to achieve success in this competitive and versatile industry. Check out his opinion about the future of his business model.
The beginning of a decade long journey
Fredrik, 41 years old, is a Stockholm-based entrepreneur. “I was born in a family of entrepreneurs in the cold and snowy northern Sweden. Both my grandfather and father run their own small business. So, by the age of 20, I left my hometown for Gothenburg, to participate in a training program for entrepreneurs. The people I met there inspired me to start my own business”.
HotelSpecials was established in 2003 in Netherlands. “My Dutch partner, Remco, was very good at manipulating Google search results before SEO practices became popular. Our first product was only a very simple homepage listing hotels. Then we started to get emails asking for bookings. As one thing leads to another, a small booking engine was developed.” In 2007 the website already had more than 1000 bookings per day. “We realized HotelSpecials could be something big!”
Booking.com also started in the Netherlands, what turns the competitor also a big inspiration. “However, while booking.com commoditizes hotel rooms and sell them to everyone on global scale, we focus on unique special offers on local level.”
The purpose of HotelSpecials is not to have as many rooms at as many hotels, but to list handpicked hotels with differentials such as dinners, free upgrade or free kids. “We always try to get extra discount for customers who are looking for package deals.”
Competing globally as local businesses
“In the beginning, driving traffic wasn’t an issue because we were at the top of the search game. However, as Google continuously upgrades its algorithm, we now rely more on our existing database of loyal customers and on big online travel agencies like Trivago, Tripadvisor or Skyscanner.”
Today, their newsletter is the main source of sale leads, despite obstacles such as spam-filters or the possibility of pay-to-send newsletter to Gmail addresses. For us, those challenges can also be opportunities. If we are good enough to pass all filters, we will be the only one that can get to customers in the travel sector.
In the long term, branding is the top priority. We want to move away from the commodity market and be clearer about our focus on customers’ holiday experience instead of selling rooms. We want customers to see us as human with feelings instead of machines.
That is why we launch our websites with local domain for each country (hotelspecials.nl, hotelspecials.de, hotelspecials.be, hotelspecials.se, hotelspecials.dk, hotelspecials.no). Instead of an international corporation, we introduce ourselves as local experts – a bunch of local entrepreneurs who know the market and run a local website.
“The difficulty is to be local on a large scale”
The difficulty is to be local on a large scale. It only takes 3 – 4 weeks to technically set up a new site with local domain. However, as all contents on our websites are in native language, deployment in a new country requires thorough analysis on the behavior patterns and interests of customers. Using AI to develop content can also be an interesting option in the future. For now, we chose to work with marketing or content partners before opening any new office with new international teams.”
“Germany is the most challenging country”
HotelSpecials is available in 6 countries in Europe: The Netherlands, Belgium, Sweden, Norway, Denmark and Germany. All these 6 websites are run by international teams located in Sweden, Germany and The Netherlands. “Germany is the most challenging country for us. It’s a huge market, which is very traditional and strictly regulated. You need to be super local to convince customers. A hard-to-get trust signal like local certifications can immensely boost the conversion rate of your site. They trick is to embrace the rules and business practices there.”
“Sweden, on the other hand, is much easier. Swedish do value quality and durability, but also keen on new things. We are savvy internet users equipped with broadband connection, laptop and big phones. Startups do not really need formal trust signs to attract curious consumers. That’s why there are a lot of startups coming from Sweden.”The future of the hotel industry
“Airbnb is truly a game changer. Yet I am personally not convinced about the success of this venture-founded firm. It is operating on a low profit margin and competing against the giant booking.com. Hotelspecials is not a direct competitor of Airbnb because we are not going to include private apartments in our portfolio. This is something we learn along the way: stop doing everything and be a great niche player. Hotelspecials will focus on our core business – hotels. We want to help people spend great time together by removing the hassle of booking for dinners and the like. Hotelspecials is the one-stop shop for people who want to get away with their daily life and enjoy a short vacation. This year, we plan to relaunch the platform with new features and more mobile friendly interface – our biggest investment in a long time.
“I see a bright future for the hotel industry”
In general, I see a bright future for the hotel industry. We should expect the rise of self-service hotels with mobile check-in and smart locks, where you can have immediate access to your room and pay without receptionists. Many hotel chains have come a long way in enhancing customer experience, creating major challenges for small and independent hotels.”
In 2016, Fredrik co – founded timetomeet.se, a real-time conference room booking platform. “The meeting industry is developing in the same patterns with the hotel industry 15 years ago. It is digitized very fast. In 2 – 3 years, online bookings can completely replace phone calls and emails for conference rooms. The market is profitable because the need for meeting rooms will evolve the same way as which for hotel rooms, but with the absence of big, international suppliers. It is, however, harder to scale up because localization is more stressed. Rarely would anyone from Stockholm book a meeting room in Paris, for example.”