Thursday, May 2, 2013

Transactional Giving Accommodation Website Relaunches

We see that our friends at KiwiKarma have re skinned their website and are using new partners, Bookit for their online reservation functionality. The new, improved website looks clean, is easy to use and was soft-launched yesterday.

From a consumers' point of view, the concept is reasonably simple. KiwiKarma is a website where customers are able to easily select and book online accommodation. The main point of difference between other bookable websites is that KiwiKarma offers a feel-good factor by donating 3 percent of the total cost of the accommodation to a charity nominated by the customer.

With most accommodation operators adopting price parity across all online sales channels, KiwiKarma's customers shouldn't feel that they've paid over the odds, however some may instinctively ring the accommodation operator direct to try and squeeze a better deal ;-)

From an accommodation providers' viewpoint, KiwiKarma simply redirects customers to live online availability on Trademe's popular Bookit booking engine.

KiwiKarma acts as a referral portal service and any bookings generated from its website interface will be under the same terms and conditions that accommodation providers have made with Bookit. The commission (up to 12 percent) will be deducted from the booking proceeds remitted to the accommodation provider as usual by Bookit.

As the accommodation provider will be dealing with Bookit from the initial reservation advice to the final payment, it is unclear if they will even know if KiwiKarma's website referred the reservation?

Bookit will pay KiwiKarma a share of commission earned from each reservation generated and from this, KiwiKarma will donate 3 percent of the total booking cost to charities selected by the customer.

It's hard to predict the scale of a niche market that would be attracted to the concept of transactional giving when making an online accommodation booking. From a darkened room, alone and staring into a glowing desktop screen, will customers planning travel arrangements necessarily have charity in mind when pondering accommodation options?

Will giving away 3 percent to charity be perceived by customers as being worthwhile? Will the feel-good factor alone influence customer buying behavior and attract them to KiwiKarma? On behalf of their customers, KiwiKarma will attract the adulation and the tax deductability as they will be acting as the charity donor to selected charities.

The website looks good, the Bookit integration functions extremely well and customers will be pleased that there are no annoying booking fees, however reaching out to a niche grouping of potential customers that will sustain KiwiKarma will be challenging.

After giving away 3 percent to charity, the net commission share that KiwiKarma will gain from bookings will hardly give them a marketing budget of proportions. Lack of funding could also restrict further development of the website to include features such as a mobility and accessibility via a dedicated app.

Smart use of networking and social media will need to be at the forefront of any future promotion.

Any new online reseller will find it difficult scrape market share off the scrum of established and trusted brand OTAs. The most obvious marketing base that could potentially give KiwiKarma some momentum will be the charities themselves that include: Arthritis NZ, The Asthma Foundation, Breast Cancer Research etc. These organisations have huge databases of employees, volunteers, donors and other interested parties that will be qualified targets for promotion and have a vested interest to provide free marketing for KiwiKarma's innovative concept.

It will be interesting to follow their progress.

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