Private equity firm Apollo Global Management will take Rackspace private in the all-cash deal.
HotelTonight’s CEO will discuss mobile-only commerce at MMCF 2012.
Two years ago Sam Shank identified a niche market—same-day hotel booking—and threw everything he had at it to come up with deep discount travel company HotelTonight. But he didn’t build an e-commerce site. He chose to build only a smartphone app and an m-commerce site—a mobile-only business.
HotelTonight has to compete with heavyweights like Priceline.com, where 70% of mobile consumers book hotels the same day, and Marriott, where 47% book the same day. So when he was starting out, Shank, CEO and co-founder of HotelTonight, decided in order to be the best, the company should sharpen its focus on one thing.
“Trying to build a traditional web site and a mobile app at the same time, that would have spread ourselves too thin,” says Shank, who will speak on mobile-only business at the Internet Retailer Mobile Marketing & Commerce Forum Oct. 8-10 in San Diego during a session entitled “How HotelTonight is Blazing a Trail as a Mobile-only Company.” “So we focused our resources on the faster growing but smaller category. We’ve built a culture within the organization from marketing to customer support to sales—everyone. They only think about the needs of the mobile traveler.”
The HotelTonight mobile app has been downloaded 2.5 million times, the company reports. Customer satisfaction is a big part of that success: The app, for example, has an Apple Inc. App Store customer rating of 4.7 out of 5.
“There is a rating system baked into the core presentation of the product that rewards product quality,” Shank explains. “The customer is responding to using a service in a way that a web business with a site doesn’t have to worry about. We knew that would be important to our success so we built everything around a customer experience that is very good.”
Attendees at the mobile commerce event will learn there are other opportunities for mobile-only businesses, as long as businesses focus on the uniqueness of the mobile channel.
“It will happen most where mobile and location-aware services have a distinct advantage over web sites—transportation, logistics, lodging,” Shank predicts. “Whether ordering clothing on your mobile device needs its own mobile brand, it would need to be a very different way of thinking about clothing. Just as there was with the Internet years ago, there will be some new brands that take advantage of the mobile medium the way Amazon did with the web.”
Internet Retailer’s editors asked Shank to speak because he founded and was CEO of DealBase.com, a travel deals search engine, and was CEO of TravelPost.com, a hotel reviews site. SideStep acquired TravelPost.com and Sam stayed on as vice president of business development until its acquisition by Kayak. Sam also worked in comparison shopping at Excite, CNET and NexTag.