The Future of Travel: Hotel Rooms as Commodities
What if a hotel room could be bought and sold like a baseball card or a Broadway show ticket? It might seem a strange concept at first, but life constantly interrupts the best laid plans and many individuals often take a major financial hit when they’re unable to use a hotel room they may have booked months in advance. What if you could resell that hotel room on a third-party marketplace an avoid the headache of losing out on what you paid for it?
Former Priceline Chief Scientist Eddie Ibañez has been thinking about this conundrum for awhile and during some discussions with co-founder David Shuler, the two decided that it should be possible for consumers to resell hotel rooms. To make that happen, they debuted LIFE Rewards – a blockchain infused destination marketplace – in December 2022. By using blockchain technology, travel reservations can be tokenized allowing them to be traded securely and seamlessly.
For guests, the user interaction flows very similar to other large OTA booking websites.
“That flow works well for users,” he explains. “The fewer the clicks, the better it is for everyone.”
The magic really happens after a guest purchases a hotel stay using the LIFE platform. First, it ends up in the guest’s digital wallet. Then the guest has the ability to put that hotel stay up for sale and set the price they want to sell it for. LIFE will then distribute it across its marketplace where it can be purchased by another guest.
A New Way of Doing Business
When asked why he thinks this type of marketplace will end up being popular with consumers, Ibañez points to the recent shift in how consumers spend their money.
“People are no longer spending their discretionary income on their houses,” he explains. “Instead, they’re looking to spend on experiences. This means that they’re willing to pay higher prices to be able to stay at specific hotels and have specific experiences – especially if those hotels happen to be sold out.”
On the other side of the coin are the consumers who would purchase hotel room nights with the sole intention of reselling them for a profit. (Think hotel rooms near the football stadium that’s hosting, in February, the most important game of the season.) Regardless, the hotel is the one who benefits. By allowing their rooms to act as a commodity that can be easily transferred from person to person, the hotel is able to pre-sell their inventory, keep their capital rates low, and continue with their business, Ibañez adds. Additionally, hotels have the opportunity to earn a commission on this resale of the room.
A New Form of Loyalty
And this concept also has real world implications for updating how hoteliers create loyalty.
“We want to reward people for their actions,” Ibañez explains. “Let’s say you travel to all of the bohemian islands – I can reward you with an non-fungible token that’s work 50% off all future bohemian travel. For those who love that area and want to keep going back, that’s a wonderful reward. For those who feel like: “Been there, done that” – they can put up that reward on a secondary marketplace and sell it.”
In the future, Ibañez hopes that guests will be able to choose their own rewards or even come up with a reward system on their own rather than having to choose from a list of rewards that was given to them by a company or brand.
“Maybe someone would love to hook up with a local in Los Angeles to show them the best places to eat, historic sites to see, hidden gems of the city, etc. That could be an earned reward. Or maybe someone travels to France and wants to participate in a scavenger hunt that has a specific theme to it – that could also be an earned reward,” he explains.
This type of loyalty and rewards program is still a far ways off, but Ibanez is always looking to the future.
“As we continue to advance, you will see LIFE go international, and begin the process of utilizing this technology for flights, experiences, and ticketed events, becoming the primary booking destination for Web3.”