"It's like eBay for the tourism industry, except it is not a competitive bidding process. Travelers can lodge bids with up to three hotels at one time, and once a bid is accepted, the others will be automatically deleted," he affirmed.
The site is especially useful for those planning last-minute vacations. If you've ever tried booking a cheap hotel through traditional sites like Travelocity or Orbitz, the lowest available rates can still be rather steep — and a few weeks, if not months, of advance booking is required to score a good deal. Ubid4rooms changes the entire process: you are able to make an offer to a participating hotel with a vacant room and receive an answer within three hours.
Beginning bidding prices are last minute advertised prices. Hotel goers can accept the starting bid rates or they can submit a lower rate which must be at least half of the advertised rate.
"I have a passionate belief that a room vacant for a night is revenue lost forever, and a property only has a limited supply, so this revenue cannot be made up in the future," Sherman observed.
He adds that, "While the cost of selling a room varies from property to property, the large majority of a hotel's costs, such as staffing, will be the same whether a hotel has an occupancy rate of 67% or whether it is fully booked."
Sherman believes that despite the fact that online booking for hotels and resorts is expected to expand in the coming years, and that by 2011 a full 20% of accommodation sales will be completed online, the "value proposition" of sites like Priceline has weakened.
For example, Ubid4rooms has, through its own methods, discovered that sites which offer rooms available at the last minute offer them at rates equal to or more than direct hotel offers. The company also found that, on average, some 60,000 hotel rooms remain unoccupied in Australia every night.
In order to fill these vacant rooms, the number of individuals planning impromptu trips will have to rise. Bidding is one lure Sherman believes will invite them to do so.
Similar bidding or price-negotiating concepts have played successfully in other parts of the world: the UK's RoomAuction.com reported $2.27 million over four years, while American Priceline.com has posted $3 billion in total bookings.
Currently, 45 properties have signed up with the Ubid4rooms, with a projected 100 expected to sign up by year's end.
The company's website proudly declares, "The philosophy of Ubid4rooms.com is that while it is an online business, it will always offer personal service to users to ensure total customer and supplier satisfaction."
