The internet is flooded with OTAs that are trying to lure travellers by offering them discounts and are fighting each other in a bid to offer the lowest prices. In the middle of all this, we came across a Singapore based startup that is doing things differently.
The company in question is the hotel booking site Kaligo.com. They cater to frequent travellers by offering an incredible number of airline miles and points for every hotel booking instead of conventional discounts or cashback. These miles and points can then be used to redeem free flights and upgrades with a large variety of airlines. A single hotel booking on Kaligo.com can easily earn enough miles for a free flight.
During our recent visit to Singapore for Echelon Asia 2015, our Founding Partner, Daksh Sharma got a chance to catch-up with Kyle Armstrong, co-founder and CEO, Kaligo at their office in bustling Chinatown. Here is an excerpt from the conversation.
What’s your background? Where did the idea of Kaligo come from? What problem is it solving?
I’m originally from Australia and have been living in Asia for about 11 years. Previously I was working with AMEX leading their premium travel services business. During that stint, we saw a gradual shift of frequent travellers moving their hotel bookings from offline agency to online.
This set of travellers are used to being treated differently and being recognised for their value. We saw there was a gap in the online travel market for loyalty and an opportunity to better reward frequent travellers which we believe represent an approximate 10-15% of the online hotel bookings.
The way we do that is by using a unique business model. Compared with the big OTAs who invest an enormous amount into mass market advertising and discounts / rebates, we instead invest in loyalty and rewarding our customers.
So what you are trying to say here is that Kaligo is a product catering to people who have a pattern of travelling often? So the segment isn’t necessarily youth or people on the lower end of the spending spectrum.
To some extent yes. We do offer a wide range of hotel types (from budget to luxury), and our customers range between 20-60 years old, with the greatest concentration in the 30-40 years old group.
When did Kaligo start and what does the name stand for?
We launched in October 2014. Kaligo is the name of a butterfly. Our logo combines two elements together- the hotel location marker as well as the butterfly. It represents that you can “take off” with Kaligo by booking a hotel and then flying for free with the airline miles that you have earned.
How has the journey been so far?
We’re experiencing rapid month-on-month growth and as we add more airline partners we are able to continue accessing new customers around the world. Currently, we have 20 airline partners and have plans to further increase that in the balance of the year.
Do you have local representatives in different regions?
Our HQ and core team is based in Singapore and we have regional offices in the United States and Europe. I’m privileged to have some of the top people in their fields on our team and on our advisory board. We have a very powerful combination of experience, skills and talent within the group which has been a key ingredient to the speed of our execution and growth.
What are your biggest markets?
We’re fortunate to have a business model that allows us to operate on a global scale and we have paying customers now in over 100 countries around the world.
How do customers come to know about the product? Are you using online marketing to promote?
We work very closely with our partners to get the word out collaboratively. We do a small amount of offline marketing but the majority is all online.
What about social media? Most of the travel brands we have worked with have some sort of localized social media strategy.
Our product is highly shareable and there are huge online communities of frequent flyers who we actively engage with. For some businesses, social media is critically important from day one. At this stage, social is more of a complementary channel for us, and it will be a gradual process for us to build it up and localize.
Have there been some exceptional customer stories since you have started, anything where you have provided some fantastic value to your customers?
Hearing from our customers is one of the most rewarding aspects of this business. We analyse our top customer behaviour every month, we get their feedback and use the information to make improvements. We have received numerous stories from customers who have made bookings with Kaligo and then taken their family on a holiday using the miles they’ve earned with us. A gentleman in the UK recently made a couple of bookings with us and then flew with his wife to Rome for a weekend getaway in business class for free. There are many more stories just like this.
At present Kaligo can be accessed via website. Are there any plans for a mobile app?
Kaligo is accessible via mobile web and our desktop site for now, and our app will be launching very soon.
We did some research and there are other companies like Rocketmiles and Pointshound offering miles for hotel bookings. How is your product different?
Those sites have built the bulk of their business in the US market and they’ve done an outstanding job in doing so. The frequent traveller segment in US is gigantic. We are trying to do things a little differently by predominantly taking an international focus.
Are you present on any Metasearch sites?
We’re not currently working with any Meta-search as we don’t fit the traditional OTA model. But you never know, something may happen down the track.
I guess we talked a bit about challenges, but are there any particular challenges that you guys are facing?
There have been many challenges, but nothing that we have not been able to overcome. This really comes back to having a great team. With the culture we have built, where we’re having so much fun, we feel energised to solve even the most difficult problems.
Okay one last question. How do you plan to scale up further? Of course adding new hotels and partners is one of the major things, but do you also plan to expand the services that you are offering now?
At this moment we are very focussed on new partners and hotels, but of course there are a number of opportunities to expand our product line or move along the value chain. We’re carefully evaluating each of those opportunities as they arise.
At this moment, Kaligo is a young brand but their team has done a really impressive job in a short period of time. They have joined hands with 365,000 hotels with new ones being added regularly. They are already helping a large number of frequent travellers make more of their spend, earning free flights and with more airlines & hotels coming on board, it will only get better. You can check out their website at Kaligo.com.
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