Earlier today, I was at an excellent talk by the HotelQuickly management team. I was keen to hear their story given their experience working at Rocket Internet. I wanted to know how they think about mobile, marketing and running an online business.
By way of background, HotelQuickly is a mobile app that allows a user to book a last minute hotel at discounted prices. The hotels are in Asia-Pacific region. There is a similar concept in the US called HotelTonight which inspired HotelQuickly.
The speakers from HotelQuickly were:
- Christian Mischler (Chief Marketing Officer). Previously co-founder of FoodPanda.
- Niklas Olsson (Director of Offline & Partnerships Marketing). Previously head of offline marketing and trade partnerships at The Iconic.
Whilst there were many lessons from Hotel Quickly in the talk, these were the top 9 that I took away. They started by differentiating between a lifestyle business vs fast growth mass market startup. These insights are for the latter.
1. Numbers never lie
They track everything. Every activity has a value. They focus on micro conversions – click to buy, click to call and interactions. The interpretation of numbers may be hard or incorrect, but they don’t lie. They debate the assumptions behind numbers but not the numbers themselves.
2. Ambition to be #1
Put the effort to be #1 in a market. If they can’t be #1, they stop. Being #1 is a bold ambition. It naturally attracts PR and top tier talent. It is based on a fundamental truth they believe in (assumption). This can be on a 2-3 year old horizon or a 10 to 15 year horizon. It is something they believe is inevitable – eCommerce, mobile, etc… Rocket Internet believes eCommerce is here to stay.
3. Market and team always wins in this order
Pick 2 out of 3: Product, Market and Team. Market and team will always win, in this order. The product itself can change. The product is rarely right on day 1.
4. Execution eats ideas for breakfast
Progression and execution is most important. Make quick decisions to avoid decision fatigue.
The Iconic has 89% brand recognition after 3 years. For an alcohol brand to get the same recognition, it could take $50mil and 10 years.
5. Be Creative When Seeking Product Market Fit
There is an assumption if you are doing eCommerce that you can create a website and you can sell on the internet anywhere in the world. However, its not as easy as it seems. It requires localisation in each market.
For Rocket Internet eCommerce companies, they did the following localisations
1. In Australia, they offered 3 hour delivery. This was a major selling point and made it newsworthy
2. In Middle East, there was no infrastructure for 3 hour delivery. So Rocket Internet built their own infrastructure.
3. In Asia they had to do cash on delivery as credit card fraud is rife
4. In Russia, most of the eCommerce customers were wealthy. There is an expectation based on local custom that the delivery person would wait outside the house, in the cold while the customer tries the clothes on.
Hence localisation and contextualisation of the core product is critical.
6. Don’t waste $$$ forgetting about the product
If you just pump money into marketing and forget about the product, you will have a leaking bucket problem. You will be losing customers in the conversion funnel. People will have a negative experience and you waste a good opportunity to generate WOM / referrals.
7. Don’t outsource customer service too early
Initially, HotelQuickly outsourced customer service overseas. However, they realised that the support staff weren’t close to the product and weren’t able to answer questions. In addition, the team missed out on opportunities to talk to their customers and gain valuable feedback. So they decided to in source it and bring it back into the business. They also noticed that customers were asking questions on social media e.g. messaging them on Facebook that they couldn’t check into their hotels. So they had to bring the customer conversation & social media back into the business to deliver a great experience.
8. In partnerships, customers should win by far the most
They look for win-win-win partnerships. In any partnership, the customer should win the most. Look for customer pester power. The best partnership in history is McDonalds & Disney. The pester power of a child to watch a movie is incredible. Then after watching the movie, a child will demand to eat MacDonalds Happy Meal to get the Disney toy that comes with it.
9. Best converting channel is referral marketing
This is about how many and how quickly can a customer refer more customers. HQ found that referral marketing was the highest converting. e.g. here is discount code MHOZQ and you can pass it onto your friends. They sacrificed the margins to fuel growth. This is an expensive tool but can lead to exponential growth.
This was described as the K Factor which is commonly used to describe the viral growth of an app or web product. The formula for K Factor is:
i x c = k
i = invites
c = percent conversion of each invite
The K Factor originated from the field of epidemiology. It tracks the spread of a virus i.e. disease infection. More about the K Factor here.
If you know me and have been reading my blog for a while, you know I like mobile apps and metrics!
So I asked “What are the top 2 metrics you track?”. These are:
2. Number of nights booked
Overall, I really liked the talk and the top lessons from HotelQuickly. They have a very methodical and structured way they operate their marketing and ultimately their business. There are definitely a lot of lessons that we can learn from the Hotel Quickly team.
If you would like to try out HotelQuickly, use my promo code: MHOZQ. You will get $30AUD off your booking when you redeem it. Download it here.
I’m out like the K Factor,