Are you the type of traveler who likes a chocolate on the pillow and a choice of having your hotel room linens laundered every day, even if the hotel management says you're wasting gallons of Mother Nature's precious water? If so, you may shudder to think there's a company convincing people to rent out their own homes as an alternative to traditional lodging, and it's growing more quickly than a hotel chain.
Indeed, as summer travel season begins on Memorial Day weekend, apps are poised to play a much larger role in booking Americans into rooms and itineraries around the country, and in far-flung locales across the globe.
This is the nature of the disruption taking place in the travel and leisure industry. The way people spend their free time, where they stay when they travel, and what they eat, are being transformed by collaborative platforms, the power of mobile and GPS.
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On the indoor side of the travel and leisure divide--for those who prefer to hide from the summer sun rather than bronze on the beach from Memorial until Labor Day--startups are offering a lower-cost, legacy platform-busting way to play video games. Are you the type of "man cave" gamer who just put in an order for the newest model of Microsoft's Xbox, thinking that its increased ability to interface online with other players is the latest in gaming? Clearly, you aren't aware that the whole TV/console gaming approach is very "yesterday."
Foursquare, the social, location-based app now boasts 33 million users, 3.5 billion "check-ins", 1.3 million merchants, and 40,000 apps using it as an underlying location engine. All those advertisers and merchants can leverage GPS data to push those 33 million users to targeted deals, a transformative approach to selling in the travel and leisure industry, and more generally, a consumption-focused American society. Consumer USA is an ever-changing opportunity for Foursquare's technology: "We're constantly thinking about re-inventing the ways we use technology to interact with the real world, often finding solutions that weren't possible even a few months ago," said CEO Dennis Crowley.
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Stodgy business travelers accustomed to Starwood Hotels & Resorts and Marriott may not understand the appeal of community-based travel marketplace Airbnb--connecting people to non-standard travel options in 34,000 cities and 192 countries--but that's the very nature of disrupting an industry: reaching a market that the incumbents can't reach, won't reach, or consider "inferior." Airbnb's business model connects open-minded travelers and uncommon hosts, allowing individuals to find a bedroom, or rent a chateau for a night or two, or become a one-person lodging company. And in an era of "couchsurfing" and the sharing economy—the company has already booked more than 10 million rooms--it's the chocolate-on-the-well-laundered-linen crowd that may soon find itself in the minority.
In between the Plaza and that room in someone's apartment in Buenos Aires is the first lodging app made exclusively for mobile and last-minute hotel deals, offering steep discounts on lodging of all types and for all budgets: HotelTonight. If you think that's a niche business, consider how big a niche it is: according to the company, there is $15 billion in the domestic same-day bookings business it has targeted. And unlike an Airbnb, which may be causing a market disruption by reaching customers neglected by the traditional companies, HotelTonight expects to catch the attention of the legacy lodging companies.
"Disruption to me is re-energizing a category dominated by legacy players by launching a product that the incumbents try to emulate within months," said Sam Shank, CEO and co-founder.
HotelTonight has 5.5 million users, and it's a big threat to hotels not among its 2,500 partners, as well as the online travel booking industry leaders, like Expedia and Priceline.
The weak spots in the travel industry aren't as clear cut, though, as is the threat to the handheld console makers in the gaming market: Nintendo, Sony and Microsoft, and even the threat to a recent disruptor like Zynga.
Kabam, which offers all of its games for free (users pay for premium content) generated $180 million in revenue in 2012, a 70% increase over 2011. Now it's aggressively courting the game designer market—offering a third-party platform for designers—and the booming Asian game market with a $50 million fund for Japanese developers. Kabam is projecting revenue of $270 million in 2013.
Instead of going mobile, Ouya is offering a living room alternative to the legacy handheld consoles, directly disrupting the last "closed" platform in gaming: television. Ouya is one of the most successful Kickstarter projects in history—having raised more than $8 million through the crowdsourced platform, and its graduated quickly from friends and family to venture capital, with a recent round led by Kleiner Perkins Caufield & Byers.
The new world of travel and leisure has gone virtual, in and out of the sun, offering plenty of touchscreen and game controller options for our thumbs during the upcoming lazy days of summer.