Alibaba Group has made the first big announcement regarding its standalone travel business alitrip.com, and it’s all about the “hotel of the future.”
The initiative “aims to use network and Big Data technology to enhance customer service and improve innkeepers’ ability to attract travellers and retain them as loyal guests.”
Alitrip.com was launched last October as a standalone business unit within the giant Alibaba Group. Previously Alibaba ran Taobao Travel as a deals-led channel on its Taobao Marketplace.
But Alitrip was always going to be more than just a distribution platform. One of Alibaba Group’s first moves after its blockbuster IPO last September was spending $450 million on a 15% stake in hotel technology specialist Beijing Shiji Information Technology (Shiji).
Shiji is at the heart of the Hotel of the Future program, and is one of a number of Alibaba Group interests that are involved in Alitrip’s plans.
For example, one concrete product launch outlined in the announcement is “Post Post Pay.” This allows certain guests “to to reserve rooms through Alitrip without paying a deposit and to enjoy express check-out…”
These guests are vetted by Sesame, a credit agency owned by Alibaba. And guests who book in this way can check-out quickly because all their hotel spend will be taken directly from their Alipay account – a wholly-owned Alibaba e-commerce payment gateway – and not settled at the desk upon check out.
More than 5,500 hotels in China offer “Post Post Pay” including chains such as Starwood.
Meanwhile Alibaba also plans to use its cloud-computing unit Aliyun as part of this Alitrip initiative, creating a cloud-based platform for hotels in partnership with Shiji.
“By leveraging Aliyun’s cloud computing and big data services, companies can create a full range of online services such as check-in, catering, sales and reservations, and membership programs… Hotel cans also use Aliyun services to analyze business and customer data, enhancing their capabilities in management and marketing.”
Alitrip’s Hotel of the Future programme comes a week or so after Ctrip – China’s biggest OTA – launched a hotel IT unit of its own, bundling various subsidiaries into a new unit known as “Joint Wisdom.”
Hotel IT is increasingly important for Sabre and Amadeus, to say nothing of Oracle, which has to make a return on its $5.3 billion purchase of Micros. Plus of course the smaller players lower down the food chain.
All of these businesses will be looking closely at this Hotel of the Future release and pondering just how disruptive the combination of Alitrip, Shiji, Aliyun and Alipay will be. For now it looks limited to China, but it will get even more interesting if and when it expands internationally.
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