I wrote a post the other day about how Bob Diener and Dave Litman, the founders of HRN (a.k.a. hotels.com), have launched getaroom.com, and indeed they intend to shake things up.
Diener, who owns getaroom.com 50-50 with Litman, described the site's introduction of "reverse opaque rates" for hotel sales.
getaroom focuses on top destinations so if you enter your travel dates and click on Orlando, for instance, you'll see the Sheraton Vistana Resort at a published rate of $125.38 per night.
However, the reverse opaque model comes into play when you register on the website and phone getaroom's call center, staffed by a third-party company, in Dallas.
Diener said that over the phone you'll be able get an unpublished rate for that hotel and others for 10 percent to 50 percent less than the online published rate.
"Our goal is to bring a lot of vitality back and make booking hotels exciting again," Diener said.
The opaque-over-the-phone channel enables hoteliers to market their inventory at rates that they would rather not disclose online, enabling a four-star hotel, for instance, to compete against a three-star property if it so chooses, Diener said.
And, consumers get the advantage of finding a great deal and knowing up-front which hotel they are booking, unlike with Priceline, where you bid on a particular star category in a certain section of a city but learn the hotel's identity only after booking it.
Diener points out that most companies are trying to push consumers online, whereas getaroom.com is incenting consumers to dial for the best deals and values.
Diener and Litman obviously believe in doing things differently and are employing a strategy similar to one they pushed with HRN back in the day.
This is how one hotel consultant described getaroom.com's strategy.
"The strategy is EXACTLY the same strategy they used to launch HRN way back in the early 1990s," the hotel consultant said. "They focused on a few specific high-demand cities, got a handle on the revenue management/yield opportunities and managed the hell out of the pricing to optimize sales and margin."
"They wound up with a low-tech setup that had better demand/price point info than the hotel chains and leveraged it," the consultant added. "Also, speed is king to Litman -- note the results' screen populates within a second."
Diener did not have much to quibble with when I read him that analysis. He said getaroom.com is focusing on key destinations and offers a limited number of hotels with the best values in each of these markets, and "yes, speed is key," he said.
Commenting on the position of hotels.com under Expedia Inc. today, Deiner said hotels.com is a major player "and still has a great brand name, adding that he and Litman were "much more focused on value" when they ran the show.
hotels.com wants to be "everything to everybody," Diener said. "They have lots of hotels even if some are of low value. Their philosophy is to put on everything everywhere."
Diener said he and Litman decided to jump back into the fray after their five-year noncompete agreements expired because "we love the industry, it's in our DNA."
He said the duo saw a great opportunity because "the economy fell off a cliff last September" and the lodging industry needed a new channel to market its inventory.
"The industry really hasn't moved [in the last five years]," Diener said. "It really has stayed the same."
It is fitting then that getaroom.com has "several million dollars" for marketing and is launching spots on satellite radio and soon it will unveil TV ads, too, all to the tune of the William Tell Overture. getaroom, getaroom, getaroom.com.....
As you may recall, the William Tell Overture was also used as the theme music for the classic Lone Ranger television show.
However, there are no Lone Rangers in this story. Diener and Litman are back at it together -- and they may be driving their new model at a very ambitious pace.