We wouldn't be even blogging for this assignment!
We will start of with a video to illustrate the importance of ICT.
As mentioned in the video, the use of technology has brought upon the rise of E-commerce transactions including hotel room reservation services.
Have you thought of how our lives would be without the presence of ICT?
Hotel room reservation in the past
Before the advancement in technology, hotel reservations service posed a problem of inconvenience to travellers. Hotel room reservations were usually made through the telephone or by going down to the hotel.
Prior to that, travellers would have to call hotels after hotels to check the availability of the rooms, prices and the services offered to the them.
With the information provided, travellers would have to evaluate each hotel and determine if their expectations have been met. Travellers would usually check out renowned hotels or go for those that they have visited before. Although yellow pages and brochures were available but information was limited locally and not internationally. Hence, it did not provide travellers with adequate range of choices. In addition, travellers who made room reservations overseas would incur more expenses, having to spend on long distance calls due to undeveloped telecommunication technologies.
There were problems encountered when it came to the actual booking itself. For example, the lines for enquiries might be engaged and travellers might have to call back several times. As the call service was not available 24/7, this posed a problem to customers from overseas when making reservation due to time leaps between Singapore and other countries. The travellers would have to look for another alternative hotel for bookings if the call was not returned which resulted in the loss of business for the hotel.
Wosh! Thank god for ICT!
ICT can manage the complexity and high volume of transactions in business which is one of the contributing factor to our economy.
ICT in business' point of view
The implementation of ICT in companies has contributed significantly to the way businesses work. The use of Internet and network linkages worldwide has propelled companies to adopt electronic commerce or E-Commerce, a mode of business that allows companies to expand their operations online. Companies are now able to carry out their businesses online without the barriers of time, distance and cost; catering to a far larger consumer base.
Let's zoom in the usage of ICT under hotel room reservation services.
ICT in hotels' point of view
Hotel booking activities such as liaising with a travel agent or personally contacting hotel branches overseas, which would have incurred cost for consumers, have begun to see a steep decline as travellers now opt for free and easy tours.
The evolvment hotel bookings in line with the tremendous change brought about by ICT allowed reservation activities to be done through a global distribution system (GDS). GDS is a worldwide computerized reservation network used as a single point of access for reserving hotel rooms, airlines seats etc. It is used mostly by large hotel chains, transaction brokers and airline companies.
Furthermore, companies have tied in together with organizations offering secured payment technology so as to ensure consumers that their transactions and sensitive data are protected. Companies outsource independent third parties like Verisign.com and Truste.com to assist in reviewing for malware/potential hackers and encrypting personal transactions that are made on the websites.
ICT in consumers' point of view
Being able to compare rates and view pictures of amenities provided by hotels across all websites would prove advantageous to consumers as they are able to carefully select the best hotel rooms that could accommodate to their needs while travelling from a range of choices.
This would in turn lead to an increase in purchasing opportunity and power for the consumer as they often pay lesser than what is expected in a normal market. Online reservations are just as convenient for the consumer as they are able to it from any location (with the presence of Internet of course) at any given time of the day.
What causes the booming hotel service industry? The main credit goes to a transaction broker which links up all the hotels.
Transaction broker
Defined in layman’s term as the ‘connecting party’, a transaction broker does not represent as an agent for the buyer or the seller. Transaction brokers work towards facilitating the necessary paperwork and transactions where products and services are being traded for value between both parties.
Sounds familiar?
In our analysis, we have chosen Hotels.com.
Business model of Hotels.com
Unlike the past, only Business to Consumer (B2C) is used for hotel reservation. Currently Hotels.com has implemented both forms of E-commerce; Business to Consumer (B2C) and Business to Business (B2B) where they cater their services to both consumers and businesses alike.
Background of Hotels.com
Hotels.com is a leading provider of hotel accommodation worldwide, offering reservation services through its own network of localised websites and telephone call centres.
Hotels.com gives travellers one of the widest selections of accommodation on the net, including both independent and major chain hotels as well as self-catering in over 120,000 properties worldwide. The company offers a one-stop shopping source for hotel pricing, amenities and availability and also specialises in providing travellers with accommodation during sold-out periods.
3 steps process of booking a hotel room
1) At the very first stage, you will need to search for hotels.
2) Next, the website shows you a list of hotels in your designated country. To help customers pick up the hotel of their choice, it narrows down the number of choices by the preference indicated by customers. Eg: A 5 star hotel with karaoke facilities.
3) After selecting the hotel, they would have to fill in the booking details and make payment via credit cards.
The hotel reservation is completed once booking is confirmed!
Based on the website, we have analysed the following advantages of Hotels.com:
Linkage of hotel rooms with travel guides
Before deciding on the hotel, the travel guides found within the website gives the travellers an idea on places of interests in the country they would like to visit. It provides convenience for travellers as they can settle their holiday plan online. At the same time, the website boosts the tourism industry as tourism around different countries is promoted through the websites.
24 hour customer service hotline
The website is designed in a user-friendly interface which allows the users to access to hotel bookings easily. For travellers who are not IT savvy, Hotels.com also provides 24 hour customer service to facilitate online bookings by answering enquiries to technical problems that customers might encounter.
Secure booking online
Booking of hotel rooms can be secured online without going through the hassle of travelling down to make a reservation. Payment can be made by filling up the details of credit card. To ensure privacy of customers’ information, the web page with payment details is secured by using SSL encryption technology. Therefore, transactions can be done safely and smoothly.
Quotation of prices readily available
Prices of the different types of hotel rooms are readily available. Travellers have a wide selection of cheap hotel rooms to extravagant hotel rooms according to their budget. A cross comparison can also be made between different hotels to find the best deal. Hence, it saves the trouble of calling or travelling down to different hotels respectively to ask for a price quotation.
Details of the hotel (e.g the location, facilities, guest ratings, pictures of the hotel
The information that is available online allows the users to visualize the hotel without having to travel down personally. The website provides detailed information such as the maps to show the exact location of the maps, facilities of the hotel, comments & ratings of guests that have stayed in the hotel as well as pictures of interior designs and bedrooms of hotels. By viewing the website, customers can gauge their expectations of the hotels.
Cancellation of hotel room
Hotel room can be cancelled hassle free without any charges anytime before checking in.
B2B business opportunities
Hotels.com has affiliate program that promotes business opportunities to both parties. The business collaboration program benefits both business parties as part of the income earned by Hotels.com is distributed to the business partner.
Comparatively, there are disadvantages that come along with the advantages:
High maintenance costs
Hotels.com needs to maintain the website regularly to ensure that the website is functioning well. At the same time, it needs to upgrade the website constantly to keep up with the ever evolving technology to be on pace with competitors. The high maintenance and upgrading fees will be a cost factor that reduces the profit level.
System deficiency
Even though technology reduce human errors but it does not guarantee to be 100% error/fault free. For example, a transaction may be omitted due to system error.
Security issues
Despite the secured website to protect the leakage of customers’ information, there is still a minor possibility that an information can be exposed to threats such as interception of data by hackers as well as attacks from Trojans and virus.
E-commerce fraud
All businesses that involve e-commerce, including Hotels.com face a common risk of e-commerce fraud. There are also a few cases of credit card fraud which result in major losses to the hotels. As reported in the news, Singapore saw a loss of 63 per cent due to fradulent e-commerce activities and banks experienced a loss of 26 per cent due to credit card fraud.
(Click on picture for the article)
Conclusion
To conclude, the involvement of ICT has advantages and disadvantages but the pros definitely outweigh the cons. Our society is heavily dependent on ICT to function in the present. We strongly believe that ICT will continue to progress in the near future and it will improve the quality of our lives and bring us to greater heights.
We have come to the end of our article. Thanks for viewing.
References:
http://www.hotels.com/
http://www.allbusiness.com/glossaries/transaction-brokerage/4961584-1.html
http://en.wikipedia.org/wiki/Electronic_commerce
http://wiki.answers.com/Q/What_are_the_advantages_and_disadvantages_of_e-business
http://en.wikipedia.org/wiki/Online_hotel_reservations
http://www.channelnewsasia.com/stories/singaporebusinessnews/view/1080205/1/.html
