Many industries are eyeing blockchain technology as a means to make their operating processes more effective. Hotels are not an exception to this trend. Nordic Choice Hotels, Norwegian hotel chain with a large presence in Scandinavia, plans to utilize blockchain technology to lower distribution costs and consequently increase profits.
Nordic Choice Hotels is partnering up Winding Tree for a blockchain-based distribution platform. Christian Lunden, company’s director of future business commented on the news saying: “It’s the open platform, and that is basically how I see it. We have a place where we can have our inventory and others can also store their inventory in the same place with the same open interface API [application programming interface] and that will bring new possibilities for new companies or new types of services that we seek”. The technology will allow the chain to offer its rooms to different companies as well. For example, a restaurant could package a hotel room in a special offer for its customers using the new service.
Adoption of this new technology will make distribution channels cheaper for the company. Existing channels, including the online travel agencies, take a large chunk of the revenue, which translates to increased prices or reduced earnings. According to Mr. Lunden, the new service is unlikely to eliminate the need for online travel agencies, and the hotel chain will continue partnering with these services. Nevertheless, this test could show that there are more effective and less costly ways to attract customers.
The first hotel in the chain to adopt the technology is going to be Hobo, a new hotel in Stockholm. The new reservation services will start to be offered sometime in February 2019. With 30,000 more rooms in Scandinavia, there is a room for the company to test the new technology in different areas and on different scales. When and how these changes are going to be implemented depends on the success of the trial version being launched at Hobo.
Nordic Choice Hotels is not the first company to partner up with Winding Tree. Lufthansa Group and Air New Zealand have also used the services offered by the company. Both companies have taken part in Winding Tree’s token sale. Winding Tree is offering a cryptocurrency Lif to investors as a means to raise funds. With the backing of prestigious airline and hospitality groups, it is very likely that the company will garner a lot of attention.