Certainty or the best price? Now you may not need to choose between those two things when booking hotels.

As someone who (unfortunately) spends a lot of time staying in hotel rooms, and flying around the world, I’m always left scratching my head at the sheer complexity of flight and accommodation pricing. Anyone who trawls booking pages will be well aware that the price for a particular room or flight will change on a regular basis. Now if you’re a happy-go-lucky sort of person, and unconcerned about slight changes in pricing and the impact it can have on your sense of getting a good deal or not, then this trait of regularly changing pricing will not concern you.

If you’re on a budget, or perhaps a tad OCD, your day will be ruined when you find out that the hotel you booked yesterday for $245 is today available for $235. Sure it may only be $10, but that is a $10 that really hurts.

This is the sort of pain that Berlin-based startup DreamCheaper is trying to resolve, and it’s a fair bet that hotel rooms are watching with much distaste. DreamCheaper wanted to educate the market about hotel room price fluctuations and help their users save money. To do this, they’re offering a very tempting prize: book whichever room you like, whenever you want and rest assured that any future price drop will come straight back to you.

That’s an attractive proposition, so what is DreamCheaper actually doing? The service constantly trawls hotels booking websites, from when a DreamCheaper user books a room until the afterward date. By searching the booking sites, DreamCheaper senses any price changes that the hotel applies. DreamCheaper promises that their solution is compatible with all the different booking platforms but is rather a peripheral service that sits on top of those platforms. As soon as DreamCheaper sees a lower price on the same room that a user has booked, it automatically cancels and rebooks said room. The service includes the search for cheaper prices, as well as for improvements in the form of upgrades or included services.

The economics of DreamCheaper are what makes it beneficial for users. Whereas third party booking websites, such as Expedia and Kayak, earn more money as they sell higher-priced rooms to customers, Dream heapers economics work the opposite way. In a perfect matching of customer need and commercial model, DreamCheaper makes more commission the more money they manage to save a guest. Says co-founder Leif Pritzel:

“Our unique model focuses on earning more the more we save our customers. DreamCheaper.com is the only service worldwide that earns fighting for higher savings instead of higher affiliate commission, so we’re the only ones on the side of the customer.”

Having worked in the consultancy and travel industry for many years themselves, the two founders Pritzel and Nathan Zielke understood hotel booking systems and decided to develop approaches for price optimization. They noticed that there are numerous possibilities to observe and compare the price before booking a hotel, but none to optimize it after the booking has been completed. On average people book a hotel 90 days prior to their stay — a period in which prices fluctuate drastically. The reason for this is the permanent utilization-dependent price adjustments of hotels and hotel booking portals.

In terms of how it works, guests book their preferred hotel room directly at the hotel, through an online booking platform, or with a travel agency. The only condition is that the room must have a free cancellation policy. After the guest has sent their booking confirmation to DreamCheaper, a specially designed algorithm is used to search daily for a price and product improvement until the free cancellation date expires. The latter includes, for example, an upgrade in the room category or an included breakfast. For this purpose, in addition to hotels and booking portals, DreamCheaper also searches so-called “bed banks”, wholesale platforms for hotel rooms, which the public doesn’t have access to.

If a cheaper price or an upgrade for the same room in the same hotel with another provider is found, DreamCheaper informs the user via email with the offer. If the customer accepts it, the booking will be changed and only afterward the original booking will be canceled.

Of course, people can use this method of canceling and rebooking themselves, but given a free service (DreamCheaper just takes a cut of any savings made) and the busy-ness of modern life, the DreamCheaper service is kind of a no-brainer. Say the founders:

“People cancel and rebook all the time, we just use technology to do it incredibly faster with way more sources than searching manually. That way we can guarantee the best price without asking you to waste your time comparing prices in a market with no transparency. It lets us save customers 15% per booking on average, higher than reported claims of competitors.”

DreamCheaper launched in March 2015 and since then claims to have saved its customers over Euro 300,000. The software automatically searches 45 different booking portals and approximately 1.5 million different hotels for the best rates possible.

DreamCheaper is, as I said, a no-brainer. While the hotels themselves, and the third party booking sites may not like what they do, it’s a fair bet that hotel guests will love this service.

Ben Kepes

Ben Kepes is a technology evangelist, an investor, a commentator and a business adviser. Ben covers the convergence of technology, mobile, ubiquity and agility, all enabled by the Cloud. His areas of interest extend to enterprise software, software integration, financial/accounting software, platforms and infrastructure as well as articulating technology simply for everyday users.

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