• RoomRocket is focused on what industry and sector(s)?
We are focused on the global travel and tourism industry, with initial emphasis to the wholesale hotel distribution channel
• Is RoomRocket a B2C service or a B2B service?
We are a B2B global travel trade service between hotel buyers (traditional and OTAs (Internet-based retailers), tour operators, distributors, etc.) and suppliers (hotels, resorts, etc.)
• What is the business opportunity for RoomRocket?
RoomRocket replaces less efficient and more costly settlement and traditional “reseller” distribution methods, and also facilitates global “direct to buyer” marketing reach for hotel suppliers.
• What is the B2B wholesale channel problem?
Global wholesale hotel distribution is inefficient and expensive, often with multiple traditional middlemen (resellers) within the food chain between hotel and eventual consumer. In addition, there is no standard financial settlement between the B2B channel players, and is accomplished with traditional bank wires, letters of credit, credit cards, deposits and negotiated contracts, with exposure to fraud, currency, time zones and language differences.
• Why hasn’t this been done before?
Neutrality is one key reason. Any one major distribution player or hotel introducing this concept would polarize the market as would any one financial service or credit card company. RoomRocket works with and connects to everyone creating a neutral marketplace and acts as a clearing house for bookings and payment, in some sense as eBay does for businesses and consumers.
• How does RoomRocket make its money?
RoomRocket charges a transaction fee to the hotel room seller for each settled booking and makes a mark-up on cross-currency transactions.
• Won’t the growing global dominance of major retail OTAs (Online Travel Agencies) like Expedia, Booking.com, Priceline, etc. threaten the need for RoomRocket’s service?
RoomRocket’s client is the hotel supplier with several B2B channels of distribution where it sells its rooms on a wholesale basis, to tour operators that package multiple travel elements, to Destination Management Companies that have strengths in local markets (with in turn multiple points of sale), to traditional travel agencies and travel agency groups (including bricks and clicks agencies with a foot in each world) and of course the OTA channel. The hotel supplier can reduce its distribution costs with the RoomRocket service and make some of that benefit available to its channel participants. RoomRocket may also reach hotel suppliers and on a lower cost basis than OTAs maybe able to do.
• What about the mobile phone channel?
RoomRocket will present the opportunity for a mobile application developer to get into the travel booking business by interfacing to RoomRocket’s common API (technology interface) to receive access to the global hotel supply and a standard settlement service to pay the suppliers in their local currency.
• What is RoomRocket’s goal, to be a global financial settlement service or distribution company?
At its core RoomRocket is a global settlement service that facilitates efficient distribution and greater marketing reach.
• How is RoomRocket’s business model different and more attractive to travel sellers and buyers than through global distribution wholesalers and middlemen?
RoomRocket provides the seller with the opportunity through its one contract to reach multiple global retail channels directly, by-passing middlemen, and in so doing taking control of their terms, pricing, cash flow, knowledge of the eventual room buyer and taking bookings without risk of fraud and currency fluctuation. For the wholesale hotel room buyer this translates to greater margin opportunity from the seller, ability to influence terms and pricing with a free service that is eliminating payment costs, fraud and currency exposure.
• Is RoomRocket a service business or a technology business?
At its core essence RoomRocket is a technology “click” business with booking and financial settlement instructions totally automated. There is little need for human intervention and customer service that only handles needs and questions from network business members and not consumers.
• How scalable is RoomRocket on a global basis? The business is highly scalable with minimal limitation of staffing headcount to increase revenue. As a network model, each additional buyer and seller added to the network increases the sales leverage to increase bookings.
• Are the high Gross Margins sustainable with revenue growth? The Gross Margin opportunity should improve from 83% with increased volume brought by efficiencies with payment partner costs and volume discounts with distribution network partners. In addition, new income opportunities from financial float, maintaining large balances of common currencies and payment partner revenue sharing will develop.
