Business

The start-up that promises hotel guests the lowest prices

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Media captionTriprebel claims its algorithm gets you the cheapest hotel rate but what is the impact on the industry?

Frequent travellers can face a host of problems when it comes to unpalatable hotel options.

Consider the unreliable plumbing, dated wallpaper, and room service meals that can arrive an hour late and stone cold.

But a German tech start-up called Triprebel hopes to overcome one of the most vexing obstacles to a pleasant stay; paying too much for your room.

Because nothing spoils a trip more than leaving your expensive single room to eat breakfast beside another guest who paid far less for their penthouse suite.

Plot twist pricing

That concern is the driving focus for Triprebel's CEO, Carlos Borges, who describes the new website as the "smartest way to book your hotel."

He says current travel search engines - think Expedia, Kayak or Orbitz - offer users a snapshot hotel rate at the precise moment they initiate a search. But the market for hotel rooms, he explains, "is not like a snapshot, it's like a movie."

In short, room amenities and prices fluctuate, like plot twists.

Triprebel's algorithm constantly checks the rates for each hotel room, from the moment it is booked, until a couple of days before a guest checks in.

"So if the rate goes down," Mr Borges says, "we change it automatically for you and you get the full advantage of that better rate."

That 'full advantage' means a refund of the difference in price, with the firm taking a commission on the cheaper replacement booking.

Triprebel's numbers show that a third of hotel rooms are available at a lower rate in the month after they are booked.

Testing time

The tech start-up is one of several that have taken up residence in one of the warehouse buildings that line Hamburg's old port canals. The firm shares its building with Greenpeace and the WWF in this rapidly developing industrial neighbourhood.

A stack of beer sits waiting in a corner for the end of the week. Mr Borges says the company's growth for the most recent quarter, which he pegs at 140%, is a reason to celebrate.

But before that, a half dozen staff must first test an additional 400,000 hotels that will soon be included in the website's algorithm. An employee's dog provides a welcome distraction, beneath a hanging picture of a Land Rover, with the slogan 'Never Stop Exploring.'

"We are travellers ourselves so we really feel good about helping our fellow travellers," enthuses Mr Borges, a Brazilian who originally moved to Germany to study for an MBA.

"When we get an email from someone praising the room he has, because he got upgraded, that's something that makes us feel very enthusiastic about what we're doing."

Busy marketplace

Staffers hail from diverse professional backgrounds in Italy, Austria and the Netherlands. Currently about half the website's traffic comes from German users, and it may prove challenging to expand internationally into the already saturated online travel search marketplace.

"Competing with other start-ups is matter of how good your execution is and how well you're funded," Mr Borges says. "So there we have a headstart, we've already been funded. We've already executed some of the technologies."

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But some travel experts question not the technology, but the financial model behind the business.

A website user is not charged a premium to guarantee the cheapest room price, but travel writer Alison Rice says the company's long-term profitability could be reliant on cooperation from the hotel industry.

"They like early bookings so they've got the money in the bank, they know they can stay open and pay their staff," says Ms Rice of hotel proprietors.

"What happens when, come nearer the date, they decide to drop the price to fill empty rooms and they have to pay the money back to Triprebel? I'm not sure how that will work with the hotels."

Travel industry consultant, Ian Mackinnon thinks this could prove an obstacle: "I think this will probably lead to a change whereby hotels will ask you for a deposit at the point of booking."

Hotels rebel

Some independent hotels have already rebelled against the existing price comparison sites by guaranteeing that only guests that book rooms directly with them can access the lowest room prices.

Mr Borges - who says he founded Triprebel after struggling to organise a group holiday for 10 friends - says pushback from parts of the hotel sector will not upset his overall business strategy.

"We're building Triprebel as a shopping assistant," he explains as he wrestles a football from the mouth of the boisterous office dog.

"The end goal is that consumers can come to us, state the purchase intention and we go out there and buy the right product at the right time, considering not only hotels but the whole travel experience, from the flights to the car rental, to the hotel to the activities at the destination."

As he puts it, "the boring part of doing the trip is up to us."

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