Click-through convenience is one of the fundamental characteristics in eCommerce business. Fast delivery, availability of various services, direct communication with customers—the more eCommerce platforms were introduced into users’ everyday life, the more habitual such things became.

This process has had an impact on the businesses that work with bookings as well. From appointment booking at restaurants to travel agencies, the ability to make comfortable reservations instead of spending hours searching is the first step of communication between customer and your company.

How not to lose potential clients at such an important stage? This article will address the insights of booking marketplaces, help you understand your target market, choose the right technology stack and marketing strategy when creating a reservation marketplace.

What Is the Booking Marketplace

Booking marketplaces allow users to book rooms in a variety of hotels, hostels or apartments around the world. One side is business (hotel and apartment owners), the other side is people who are traveling or visiting another city/country for any other reason. Your marketplace in this case is the link between these two entities.

Online booking marketplace implies the presence of an online booking system. Using it, clients can choose a direct time or place for booking, book an appointment or pay for rent of goods/services that are offered on your platform.

If a “traditional” marketplace is a link between the seller and the buyer of goods, an online booking marketplace retains this principle within the tourism industry, but changes roles and connects customers (buyers) with different service providers (sellers).

At the same time, the services on booking marketplaces could be as diverse as the goods in regular marketplaces: book a hotel room, a table in a restaurant, a plane ticket, a car for a long trip and so on.

In eCommerce terms, these resources are called E-reservation platforms, the term definition covers the full range of potential reservation or rental services. Basically, they host multiple service providers and allow users to book both their products and service times. For example, if a customer wants to book an appointment with a dentist, they can do so through your service.

Over time, however, we have become more accustomed to such platforms as travel activity booking marketplaces. Most often they are associated with booking a room or apartment of your choice while traveling. So, in this article we will be focusing on this subject.

Main Features of a Booking Platform

What are the key parameters that differentiate booking marketplaces from other marketplaces? We suggest you review the most important and basic ones. In addition, understanding the mandatory features will make it much easier to develop a business model if you plan to enter the eCommerce space with your own booking solution.

Calendar

Yes, it all starts with the simplest—a calendar. In fact, it’s a key introduction point of your communication with clients. When your platform provides a responsive, stable, and user-friendly calendar, it automatically tells the client that you are conscientious about your own service.

Of course, the calendar is accompanied by a booking features form where your guests can check availability, for example, of different landlords to book a space or room for a specific date and time.

The communication also works in the direction of the landlord. When a customer selects a specific date and time, a landlord gets an instant notification.

Appearance and Frontend

The design of the booking form should be consistent with your brand identity. Provide logically structured data about the booking, costs, room/space, address and an interactive map. On the other hand, a booking form should not complicate the booking process for users and provide them with clean and dynamic fields for entering information.

In addition, information about rental properties should be accompanied by high quality images that realistically show users what the landlords listed on your site have to offer.

Online Booking

Having a contact form on your website is nice, but it doesn’t give your clients confidence. By using a real-time booking form with the ability to track the status of a customer’s request, you will increase the level of trust in your resource.

After paying a deposit, guests can secure appointment slots on your platform, keeping track of their rental status: pending, payment’s process, reservation, room/space is ready and waiting for a guest at a certain time. This way, clients can be sure that their reservation is not accidentally lost anywhere, and technical difficulties will not spoil their vacation, as everything is booked in advance and displayed online on their device screen.

Multiple Payment Options

When it comes to travel services, the payment system is almost as important as the convenience of a responsive booking calendar. In this case, your customers, who could be residents from another country or city, do not want to get into an awkward situation resulting in being limited to a few payment methods.

Some would prefer to pay with a credit card or bank transfer and some opt for PayPal or other online transfer systems. By empowering your customers, you can increase online bookings on your site.

Multiple Languages and Сurrencies

Your travel activity booking marketplace should not only be available in English. Client’s ability to sign-up and book using their preferred language, as well as an automatic currency converter, will make the whole process much easier. Accordingly, it will have a great impact on the credibility of your resource and brand.

Email Automation

Emailing guests about reservations is a thing of the distant past. New reservation management systems allow your customers to interact with your resource tech support via a form on your website.

All automated actions—booking confirmations, identity verification, and documents—come as an email notification. Of course, this is a huge time saver for you, your customers and landlords.

And if you add a touch of your unique branding to such automated emails, it will also be a nice gesture.

Invoicing

Nowadays, it’s hard to find a booking service that does manual invoice writing. Automate this process, but pay special attention to details: a proper invoice contains an invoice number, various tax rates and a clear breakdown of services.

A booking system will help you manage all your booking data. You can use financial data for accounting purposes and customer data for marketing purposes.

If the first is already obvious, the second can be provided with additional help from third-party services like Facebook or Google Ads. With their help, you can analyze which services customers pay attention to most often.

Integration APIs

Within your booking marketplace project you should be able to use all the data you collect over time through integration APIs.

This means exporting customer data and booking form behavior for marketing purposes such as newsletters, as well as exporting financial data for accounting purposes. You can easily reuse data in other software through integration with third-party systems.

What will it take? Connecting your platform to different external services like Stripe for financial transactions, MailChimp for newsletter automation and semantic search like Searchanise, Sphinx, Elastic Search to track data for different queries.

Booking marketplace is most often quite a complex structure that requires additional customization. However, if you use the right framework, you can fit such a complex content into a simple and clear interface.

Simtech Development works with CS-Cart that provides booking marketplace solutions. You can launch MVPs for a quick sales start, as well as request additional customized features as your business grows.

MARKETPLACE DEVELOPMENT

Vendor Management

Vendor management describes the process of managing a marketplace’s relationships with its vendors. In our case, of course, we are talking about service providers or landlords and booking marketplace.

Basically vendor management includes the following stages:

Attracting vendors, i.e. finding the best service providers for your marketplace. Of course, before you do this, you should have a clear idea of what your booking marketplace is: will it be a niche marketplace offering rentals in only one location, or a platform covering several regions? This will determine your strategy for building relationships with landlords.
Vendor activation, or the moment when the service provider starts its activities on your booking marketplace
Vendor retention, that is, implementing a number of factors that minimize vendors churn from your platform. These are smooth payments, useful instruments, and easy management of your vendor dashboard.
Vendor maintenance, of course you must take the appropriate steps to attract vendors, but they must also deliver quality results to make a positive contribution to your business. This is where maintenance comes in. First set parameters for acceptable performance, and then continue with ongoing quality control achieved through monitoring of vendor performance.

This can be accomplished through a vendor management system (VMS), a platform that centralizes the many moving parts of vendor management. The platform automates workflows, facilitates onboarding, and sets standards for vendor maintenance.

Note that the VMS you choose should include:

monitoring vendor’s performance functionality
onboarding tools
vendor dashboard
vendor agreement management

How to Create Booking Marketplace

Okay, let’s say you’ve decided you need a booking marketplace. Where do you start creating it?

Step 1. Choose Your Destination

Choosing a niche will certainly have a direct impact on how you will run your business. Since traveling involves many aspects, you can choose different types of booking preferences.

Booking apartments and rooms like Airbnb and so on. Booking hotel marketplace like Trivago, Oyo and the like. And even booking various vehicles for traveling like Redbus, Ola, Uber and so on.

Moreover, you can focus on different types of travel. For example, will you offer luxury or budget travel services? Perhaps you will operate in one region or spread your services across several continents. Think about these fundamental things.

Step 2. Study Your Competitors

You’ve chosen a niche you like. Now it’s time to find out if there are many of your direct competitors in it? Are there gaps that you can fill with your unique service? What does your business opportunity look like?

It will be helpful to conduct a competitor analysis and research your competitors’ resources, their prices and full list of services to find the missing piece that you can utilize. Moreover, you can read your competitors’ customer reviews to understand what travelers value most and what your competitors, on the contrary, lack.

Step 3. Develop Your Business Model

The business model directly affects not only your customer relationships, as well as with service providers and landlords. It’s important to choose the one that best fits your business, values, and market positioning.

If your platform has a wide variety of vendors, then a commission-based model is appropriate. If you plan to target the high-end luxury segment, then exclusivity will be perfectly emphasized by a subscription-based model. If you want to keep full control of all financial transactions and combine different options over time, a transaction-based model will be a good solution.

Don’t forget that all mentioned above does not keep you within strict limits, but guides you at least the first steps in establishing your unique business model for your booking marketplace project. Once you’ve settled in and identified the strengths and weaknesses of business models, you’ll be able to combine options.

Step 4. Get Your Platform Frame

A well-functioning website, adapted to both computer and mobile devices. Remember, we are talking about the convenience of travelers who can visit your resource on the go mostly and need all the services in one app with minimal response time and attractive visuals. These are the necessary parameters for an active booking marketplace.

As we mentioned above, booking marketplace is quite a complex solution. You can order development of an online booking and reservation marketplace completely from scratch. However, it doesn’t mean that you can’t use a pre-built marketplace solution and supplement it with a ready-made booking software.

This option is well matched by solutions from our partner CS-Cart. From Standard to Unlim edition you’ll be able to find a huge number of modules on the CS-Cart add-on market or request unique modifications to out-of-the-box solutions to create your custom booking system.

Step 5. User Experience Design

User Experience Design is often associated with—or even replaced—by terms such as usability or user-friendly design. However, in reality they are most likely subsets of UX design.

Since UX design encompasses the entire user journey to your service, a user-friendly interface is a crucial component of your marketplace. From the windows layout to the font size for easier reading and clear navigation, all of these directly affect the user’s perception of your brand.

If you need consultation or UI/UX design for your eCommerce booking project, then you can contact Simtech Development! Since 2005, we have been providing various services to develop and provide eCommerce platforms with the necessary tools.

ORDER A UX/UI DESIGN

Step 6. Establish Security Measures and Payment Processing

Users will hardly be able to trust your booking marketplace if they are not sure about the protection of their own data. Especially considering that communication with your service is bound to involve sensitive data such as payment information, first name, last name, passport details and so on.

Of course, you need to take care of industry-standard security protocols by making it one of your reliability priorities. Implement data encryption technologies and escrow system on your platform. This allows you to hold financial transactions until the service is performed.

Step 7. Research Your Partners And Marketing Strategy

Depending on your business model, you should choose your future booking providers, whose services will be the main value of your service. Research hotels and landlords in your location, if you are going to provide accommodation for rent. Get to know the nearest airlines and rental car companies for additional services. Your marketing strategy will include this question: which of them could you work with?

Step 8. Develop and Launch a Marketing Strategy

One of the final steps is to implement a marketing strategy to attract customers. Consider using search engine optimization (SEO), social media, and email marketing to attract your target audience.

Step 9. Don’t Forget About Customer Support

Given the specific nature of а multi-vendor booking marketplace, you will have a lot of questions to answer, and often. While a “traditional” marketplace captures the process of product delivery, the rental process is more labor-intensive and many problems and questions can arise due to the human factor.

Therefore, your technical and customer support should consist of qualified professionals available 24/7 to advise users.

Read more:

Booking.com-like Marketplace: How Much Does It Cost?

Booking.com is the world’s largest online reservation platform, where thousands of hotels and accommodations are collected for any travelers to book and rent. Of course, thinking about creating your own marketplace booking system, it is difficult not to consider such a giant as a main example of a successful business.

There is no set in stone cost of such a web reservation system. The final development price depends on the following features:

Core features: search, filtering, marketplace booking system, user profile, secure payment methods.
Advanced features: availability of in-app chat, real-time booking cost tracker, offline access to tickets and documents from mobile app, itinerary management, and so on.
Mobile booking app development: native or hybrid development approaches will also affect the final cost of your project.
Backend: building infrastructure for platform management, supplier management (landlords/hotels), classifieds user accounts and other integrations.
Testing: bug fixes, ensuring smooth loading speed and performance, functional and non-functional testing.

On average, the final cost of a fully customized marketplace in the travel industry ranges from $30,000 to $80,000. However, if you use a pre-built solution, the cost can be slightly lower.

Want to know the exact cost of booking marketplace development customized for your business needs? Contact us!

CONTACT US

Monetization Models for Reservation Marketplace

Above, we mentioned the existing monetization strategies that are relevant for any marketplace in general. However, reservation marketplaces have their own nuances of monetization, so not all models will be universally effective.

Here are the most common and proven with time options.

Commission Model

This model is the most common among marketplaces of any business type, and booking marketplaces are no exception.

It works like this: the customer makes a booking confirmation on your platform, pays a deposit, then money is transferred to your account. You, as booking marketplace owner, deduct your transaction fees from that amount, the remaining part is transferred to the service provider.

The amount of commission varies depending on the property’s type and location, as well as the total cost quoted by the landlord/hotel.

Subscription Model

Subscription models are usually applied to marketplaces that offer expensive or exclusive travel services. In rare cases, the subscription model applies to visitors, more often to service providers only.

It works like this: the subscription system allows marketplaces to segment the roles of service providers. Those who make small profits will be happy with few features at a minimum cost. The minimum cost implies a limited number of showcases, successfully completed transactions and so on. Those who intend to work with the platform seriously in the long term will be interested in purchasing the highest subscription level, which removes restrictions.

For this model of monetization booking marketplace needs to gain a wide audience in advance, because no landlord will come to the site where there are no users.

Freemium Model

Technically, the freemium model is very similar to the subscription model. There are two key differences: freemium is most often applied to customers of booking platforms, and it is an additional way of monetization rather than the main one.

It works like this: you offer a free version of your online booking marketplace, but make some exclusive booking options available for a certain fee to spend.

Such features could be: booking a taxi to the airport, an additional travel guide, discounts at local restaurants and so on.

Advertising Model

Advertising is the most common strategy for additional monetization of booking marketplaces.

By finding reliable partners, strategically placing in-app ads, offering collaborations with taxi services, and many other ways, you can not only increase the monetization of your marketplace, but also attract new customers.

It also expands the possibilities of your marketing strategies: you can collaborate with popular services and offer joint deals to users. For example, if customers use your service, they can get a taxi ride with a discount.

Relevant ads, such as those for airlines, car rentals or car share, or travel insurance, can enhance the user experience while providing a valuable revenue flow.

Read more:

Booking.com Competitors

Agoda

Among Booking.com’s competitors, Agoda stands out as a resource focused on cheaper travel. Offers display options from 4.5 million hotels and properties around the world. Additionally, the site allows you to book flights, entertainment and much more.

The main way of monetizing the site is the commission-based marketplace business model. The commission is charged on each transaction made on the site.

Expedia

Expedia has been at the forefront of the global transition to online travel booking format and continues to evolve its business to meet the growing needs of its users.

For example, during the COVID-19 pandemic, Expedia shifted its strategy to focus on the clients’ travel experience, rather than just the volume of travel bookings.

The resource’s business model is also based on the commission type. Commissions are charged on a range of booking products and services, including flights, hotels, car rentals, and so on.

Tripadvisor

Tripadvisor is a bit different from the previous examples of websites like Booking.com. It is the world’s largest travel recommendation platform, connecting a global audience of potential travelers with travel partners through content, price comparison, reviews, online booking and related services for destinations, accommodations, travel activities and experiences.

Tripadvisor’s business model is based on matching consumer demand for travel with partners offering accommodations, restaurants and other travel-related services.

Airbnb

Airbnb is a community-based online platform that makes it easy for travelers to book private accommodations. Owners can post listings and earn money from rentals.

Airbnb operates on a commission-based model, charging both hosts and guests a commission. For each booking, Airbnb charges the guest 6-12% of the booking fee. In addition, Airbnb charges the host 3% for each successful transaction.

Hostelworld

Hostelworld was founded in 1999 by two entrepreneurs, a hostel owner and an IT executive, who were also going through the process of migrating to the online space and beating the competition. The company uses social features to connect travelers with hostels and cities based on booking data.

Hostelworld generates revenue primarily from the commission the platform charges for each booking. The company also generates revenue from advertising and listing properties on the platform.

Few Concerns Towards Booking Marketplaces

While launching a booking marketplace is a great opportunity to grow your business to be present in almost every corner of the world, there are hidden challenges that entrepreneurs should be aware of.

Regulatory compliance. Booking marketplaces cannot afford to operate solely in the digital space, so your business will also involve the physical presence of hotels, rooms, and so on. Accordingly, you must comply with the laws of the territories where the booked property is located. This includes regulatory compliance, licensing, tax obligations, privacy regulations and consumer rights.

Partner relationship management (PRM). As a booking marketplace, you’ll work with other partners, including hotels, airlines, and car rental companies. Managing relationships with them becomes a challenge as you negotiate deals, ensure accurate inventory records, and resolve disputes.

Criticism of reservation services. Booking marketplaces are a problem for countries leading in international tourism. First of all, this is true for local residents: the demand for renting rooms or apartments drives the cost of real estate up, and the abundance of tourists makes it almost impossible to live in the busiest districts. Moreover, local authorities are trying to restrain booking giants’ activity mostly due to the initiatives of antimonopoly authorities. Booking marketplaces used to prohibit hotels and landlords from placing their listings elsewhere if they were already working with one platform.

Fraud and chargeback risk. Online transactions are susceptible to fraudulent attempts to use stolen cards or fake IDs. This can lead to frequent chargebacks and financial losses, as well as damage to your reputation and stability. You should take steps to protect your business from fraud, such as implementing secure payment processing and fraud detection tools.

High marketing costs. Marketing a booking site requires a significant financial and time investment. It is not easy to stand out in a highly competitive market, and you will need to invest in paid advertising, social media, and SEO.

Technical troubleshooting. The success of a booking marketplace depends largely on the functionality and user experience of the website. Slow loading times, broken links, and server downtime can lead to frustrated customers and lost business. Work with a reputable development team and invest in regular maintenance and updates to ensure the site remains functional and relevant.

Booking Marketplaces’ Future

Of course, booking marketplaces and any other online booking system will be relevant as long as people are willing to discover new places and travel around the world.

Another question is how online booking systems will evolve, what tools will change the usual online booking landscape and what you can utilize for your platform.

Artificial intelligence, for example, is increasingly becoming not only an in-store/marketplace online advisor or a direct participant in users’ searches, but can also help make recommendations for your booking marketplace. Probably soon we will be working with AI-based travel and scheduling recommendation algorithms.

And gradually, the trend is to integrate booking systems with voice and visual assistants, such as Alexa or Google Assistant. This is not only convenient, but also much more inclusive for all people. A VR or AR-based tool visual interfaces, including virtual reality (VR) service previews, can provide customers with a more handy booking experience.

Why Choose Simtech Development For Creating a Booking Marketplace

Today, millions of companies worldwide use reservation software. This wide implementation covers various industries including healthcare, sports, beauty services and of course hotels and tourism.

So, let’s summarize what you might need to use booking marketplace effectively:

Booking features.
Advanced booking management.
Secure payment methods.
Data protection measures.
Mobile devices support.
Calendar feature to manage all bookings received in your store.

With this in mind, you need a reliable provider to implement additional enhancements for your booking marketplace. And we at Simtech Development are here to help!

If you want to add the booking functions in your marketplace but don’t know where to start, please contact us. Our experts will answer all your questions!