2. Introduction Along with the development of the society, people can see with their own eyes how the mobile/smartphone industry has grown in the 21th century. On a long-term perspective it has become one of the indispensable tool of our everyday life. We use them to communicate, check information and make all kinds of reservations. But that is not the only thing changing our life. “Hospitality and tourism industry … is considered the largest and fastest growing industry in the world” (Anuar, J., Musa, M., & Khalid, K. 2013). Overall the number of tourists is also increasing all around the world. Therefore the hospitality industry had to come up with a system that provides services to link the mobiles devices and therefore keep up with the times. Thus, the industry reacted by launching Mobile Hotel Reservation (MHR) Services that enable customers to access their favorable hotels with only a single click of a button (Wang & Wang 2010). But there are still some questions that need to be answered. For example, how does the booking procedure through an app work? Are mobile bookings a unique service and distribution channel? What is last minute booking and do travelers who use mobile devices usually act on impulse? In the following content we will answer those questions. 3. Booking Procedures 3.1 Direct Distribution vs. Indirect Distribution When talking about mobile bookings, we are obviously talking about bookings that are done via mobile devices. Especially hotels and airlines in the tourism industry are using those tools and are an important sales distribution channel nowadays. In order to understand in which position does mobile booking stands in the market, we have to learn what direct and indirect distributions of tourism products are. Digital booking such as the booking through a brand website, Emails, Internet booking engines and social media, all belong to direct distribution channels. Non-digital bookings such as through phone calls and on site travel agents also belong to direct sales channels. On the other hand, booking through tour operators, GDS, “Incoming tour operators, retail travel agents, destination management companies,professional conference organizers and online travel agents/third party websites” (Lenoir, 2015) are indirect booking which means reservations that are generated by agents who resell your tours and activities. Mobile booking can be both 4 direct and indirect sales channel since you can do any online booking and services with a smart phone. According to Seth, 57% of all bookings are made on the internet.(Seth,2017). Mobile booking take a big part of it. “Worldwide mobile travel bookings grew by 13 percent year-over-year for the second quarter with smartphones in the lead.” (Shankman, Ting, Peltier, 2016). The chart below shows the share of online bookings by device types. (Shankman, Ting, Peltier, 2016) It reflects how the mobile booking tools have grown over the last year. Having a direct comparison it can be said that there is a trend towards smartphones and away from tablets. Furthermore according to the report by PhoCusWright (Bill, Carroll, Lorraine, Sileo, 2014), the percentage of travel booked via mobile devices is expected to at least double in the U.S. and Europe over the next two years. Mobile Bookings as a Share of Online Bookings by Region, 2013 vs. 2015 (Bill, Carroll, Lorraine, Sileo, 2014) 5 Pointing out the mobile indirect booking, it is sometimes not as efficient as direct bookings. However there are also some benefits such as traditional travel agents that can help arranging the whole trip instead of planning it by oneself. With OTA’s there is also a great and modern tool given to check offers and do bookings. Among all those channels, booking through OTA’s such as booking.com, Expedia.Inc and Hotel.com there is definitely a trend in today’s world. A report from Google shows that “when booking online, 41% of tourists prefer to do it through OTAs. 50% of people aged between 35 and 44 prefer to reserve through OTAs” (Tnooz, 2014). This age group should be seen as a strong target group for OTA’s. 3.2 The uniqueness of mobile booking When talking about mobile booking, one may think it seems like a replicate of the internet world into a mobile world. In fact mobile bookings are a big part of the online booking segment. Despite the similarities have their own unique advantages. Most managers of OTAs and hotels have apps or websites with responsive design which means the website can adjusts itself to fit the smaller screen of a mobile devices. Since they could not put too much information in one page, they only show the most important functions and click buttons on the first page. The display of all the elements of an app is usually more structured and clearer than a web page, which appears on a computer screen. That is one of the most obvious difference when it comes to user experience. Besides, there are so many others benefits which make the mobile booking stand out among all the other distribution channels. This can be something such as flexibility, accessibility and many more which will be discussed in the following paragraphs. 4. Hotel Mobile Apps The world of the mobile applications has been a growing industry for years. Now a days, we have a mobile app for everything, whether we talk about games or booking applications, it can all be found. There are many reason for the growth of this; it might be faster, easier or less complicated. With reference to Intelity (2017) it has been found that there is more mobile devices in this world than there are people, regarding why so many investments have been going 6 towards the technology industries. Having said this, it is pretty clear that every company, especially the hotel industry has to keep up with the hotel app developments. Referring to this, we notice that booking websites, as well as hotels are starting to create their own applications for customers and potential customers to download and make use of. Regarding Appytect.com (2013-2017) it is stated that it gives hotels with a mobile application the opportunity to reach out to a large amount of people as almost everyone has a smartphone these days. A hotel mobile app also makes it less complicated for the company to reach out to their costumers leading to a potential increase in loyal customers. Furthermore, it is said that it might also increase its hotels revenue numbers because it is an easier and faster way for people to book their preferred hotel. When looking at hotel mobile bookings you also have to differentiate between individual hotels and brand hotels. In 2016 individual hotels valued 6,4 % bookings through the hotel website, wherease hotels of a brand value 15,8 % which is much more (Pressemitteilung des Hotelverbandes Deutschland (IHA), 2017). In combination to that one might argue that brands do have better resources to create such apps, which make them the premier types of hotels in terms of having mobile apps. 4.1. Benefits Like we have already mentioned, hotels having a mobile application bring many benefits toward the hotel company. With reference to Intelity (2017) it is said that in 2009, there were 2.52 billion mobile app downloads, estimating that this number will reach up to 268.69 billion downloads. These numbers show that many apps are on the market right now leading to a high number of competition. This also applies for the hotelier world. As technology is growing rapidly, the hotel world also needs to keep up with this. Still referring to the website, about 70 percent of travelers are making use of the mobile apps, just because travelers expect to do everything by using their mobile phone. Not to mention, that if a hotel has a mobile application, it not only brings benefits towards the company but also many towards the guests. A good example of this is given by 7 the Ritz Carlton mobile application. With reference to Paperlit S.r.l. (2015) the Ritz Carlton application gives guests the opportunity to get an early check in, access to deals and special offers, get room service, do an online check-out again as well as enabling the guest to get in touch with the hotel anytime they need to. Moreover, many hotels are providing more services on those apps, for example, giving advice on where to eat and what to do outside the hotel during the stay. This not only saves time for the hotel staff but it also saves time for the guests themselves as they do not have to go to reception anymore to ask or look things up themselves. These are some benefits for the guests. However, a hotel app also brings many advantages to the hotel. One advantage already mentioned is the decrease in time consumption of the hotel staff. When a guest has already checked in or checked out online, the staff does not have to go through the whole procedure anymore. Referring back to Paperlit S.r.l. (2015) a hotel mobile app also enables the hotel to promote themselves on the app itself, for example offering something special which is not often seen on other hotel apps or rewarding customers by giving them points for using the app or by making them take part of some actions. These factors in the application can lead to an increase in loyal customers. Referring back to Intelity (2017), one main goal for a hotel is to build up a relationship with their customers. This factor is all about improving a guests experience. It is not only about making it easier for a guest to go through some main procedures, it is also about creating a one-time experience for the guests. These days, guests prefer it the easy way, and as sad as it sounds, people like being able to connect to someone over the phone, rather than asking someone in person. Withal, when a guest feels welcoming as well as comfortable, they are more likely to come back – creating loyal customers. Last but not least, the aim for a hotel should be to make it as easy as possible for customers to go through their everyday procedures. Whether this means checking in faster or looking for a place to eat. It should save both parties, the hotel and the customers time. These time savings lead to having more time to do other activities or tasks. 4.2. Loyalty Programs As already mentioned before loyalty is a very important factor within this topic. A lot of hotels use their mobile apps to provide benefits regarding their loyal customer. When signing in with your loyalty program account you can use special tools, which make your stay 8 easier and more comfortable. It is a good way to strengthen the relationship to the guests. Brands are also trying to strengthen the loyalty and encouragement of those members through incentives that are available by using this app. As indicated before, most of the brands offer special tools such as the mobile check-in to make the process easier and faster, hotel keyless room entry and mobile check out. By not being a member, those special tools are not available (Intelity, 2017). When booking a hotel via the app you directly get displayed the special rate for members, which makes the booking process very easy and short and therefore attractive for the guests. The important question in case of loyalty programs is, if it is just the loyal customer that are using those hotel mobile apps to book their trip, or if those mobile apps also attract other people to book their trip with the brands app. Generally speaking it can be said that the more someone is travelling the more someone can benefit from those mobile apps due to flexibility and other benefits. When looking on loyalty programs it is the same, since the more someone travels the more points can be earned. Therefore those two categories are closely connected in terms of their advantages for specific target groups. Furthermore “They’re also a powerful way for brands to build deeper relationships with their customers. A mobile app marketing strategy can complement a brand’s offline experience (in-store special offers, for example), drive e-commerce, or simply help connect a brand with its loyal customers.” (Tiongson, 2015). Generally it can be said that there is a high competition between OTA’s such as booking.com and Expedia and the hotel chains itself. As Deanna Ting (2016) published, it is a mixed relationship between those two groups. On the one hand OTA’S are helping hotels in terms of closing the gaps, however they are at the same time a significant competitor as well. Nowadays a lot of hotel brands are trying to compete against the trend of people booking via OTA’s. The brand Hilton for example launched in 2016 a marketing campaign to fight against the use of third-party channels and in favor of using the brands mobile app for the booking process. Marriott on the other hand offers guests that pay a higher direct rate than third-party rates to give the money back plus 25 % disount on top. With this strategy they are cutting off the price advantage some people might think to get from OTA’s. With those lower rates and loyalty programs, brands are trying to attract guests booking with them preferable so that their market share gets bigger again (Ting, 2016).