Hotel Booking App Development: Cost, Features, and Monetization Models

In this post, we’ll guide you through hotel booking app development aspects: from types of hotel mobile app to required features and monetization models. You’ll also learn how to build a high-quality and client-oriented product. All this information will help you with your own hotel app development.

We wouldn’t be touching on the topic of how to create a hotel booking app if the Travel and Tourism niche wasn't promising and flourishing, right? So, we decided to gather some optimistic predictions to strengthen your decision to enter the market with your own hotel booking services. The research based on Statista indicates that:

• The 'Hotels' segment of the travel & tourism market stands for the largest ones, with revenue estimated to reach $479 billion in 2026, rising from $411 billion in 2023.
• The global number of users in the Hotels market is forecasted to rise to 1,328.00 million users by 2026, up from 1, 147 users in 2023. With such a large user base, you’ll definitely find your niche.
• It’s estimated that around 76% of worldwide sales in tourism and travel will be made online by 2028. This shows an increase from 70% of total revenue accounted for in 2023.
• The average revenue per user (ARPU) is expected to attain $0.46k ($460); which means if you have 100,000 users for your hotel booking app, your annual revenue would be $460 million.

The stats above clearly indicate that creating an app for travel booking is still a good idea for anyone thinking about this opportunity. Since the demand is constantly growing, there is enough market space for healthy competition, and you have a chance of taking a large slice of cake.

The majority of current technology can be beneficial for hotel reservation app development and reevaluate the hospitality landscape. We’ll discuss the key trends startup entrepreneurs, hotel owners, and travel agencies should look for.

Artificial Intelligence (AI) and Machine Learning (ML)

AI and ML technologies can enhance the search and recommendation capabilities of hotel booking apps. They can analyze user preferences, historical data, and real-time information to provide personalized recommendations and tailored search results.

For instance, you, as a travel agency, can employ AI and ML algorithms to recommend hotels based on users' previous bookings, preferences, and ratings. This approach can result in an increased customer satisfaction rate and repeat bookings.

Blockchain for safe transactions

To create a hotel booking app blacked by robust security, you can integrate blockchain. This technology offers a decentralized and secure platform for transactions in the hotel booking industry. It ensures transparency, eliminates the risk of fraud, and provides a trustworthy environment for both hotels and travelers. By leveraging blockchain, hotel booking apps can offer users a secure booking experience.

For instance, by incorporating blockchain during, you can eliminate the time and cost associated with transaction disputes and chargebacks.

Voice search and assistants

With voice search and virtual assistants, users can effortlessly search for and book hotels using voice commands. By integrating these solutions, app users will be able to make hotel bookings, inquire about availability, and seek recommendations by simply speaking to their device.

If you're a hotelier, I suppose you already know what you need to create a booking app for. Or maybe you want to partner with other companies to complement the app with car rental and booking flights? It's up to your business objectives.

For your information, I’ve categorized key groups of hotel booking apps, so you can briefly overview each app's features and choose between unfamiliar applications (if it’s relevant).

Online travel agency apps, also known as OTA apps, are platforms that aggregate hotel listings from various sources. These apps allow users to compare prices, availability, and amenities from multiple hotels at once. Online travel agency apps typically offer a wide range of hotels to choose from, including budget options, boutique hotels, and luxury accommodations. Booking.com, Expedia, TripAdvisor give an idea of how to create hotel booking app of this type. In 2023, the Booking net income amounted to $2.4 billion with 74 million app downloads.

Direct booking apps are developed by individual hotels or hotel chains to facilitate direct bookings. These apps allow travelers to browse through the hotel's offerings, amenities, and room options. They often provide exclusive deals and loyalty rewards for direct bookings, enticing customers away from third-party platforms. They also often offer additional functionality, for example, concierge service app. Marriott Bonvoy, Hilton Honors, Hyatt have inspired entrepreneurs to explore how to make a hotel booking app.

For spontaneous travelers or those in need of last-minute accommodations, last-minute hotel booking apps come to the rescue. These apps specialize in offering discounted rates for same-day or next-day hotel bookings. Last-minute hotel booking apps can be a great solution for travelers who are flexible with their plans or looking for a bargain. HotelTonight and Hotels.com are prominent examples of last-minute hotel reservation app development.

Metasearch engine apps allow users to search for hotel deals across multiple OTAs and hotel websites. Instead of directly booking through the app, users are redirected to the chosen OTA or hotel website to complete the booking. Metasearch engine apps provide the convenience of comprehensive search results while still allowing users to book directly with their preferred provider. Kayak, TripAdvisor, Skyscanner are the best examples of hotel booking apps of this type. In 2023, Kayak made$1,7 billion with total fundings of 3.3 million.

Vacation rental applications enable users to book vacation homes or private residences for a short time at the affordable price compared to traditional hotels. Through hotel booking app development services, you can build vacation rental apps and offer services to property owners on commission basis. Landlords, in turn, can show their properties to people worldwide and the travelers can access numerous accommodations in one place. Typically, such platforms are integrated with listings services to enhance the visibility online of property and attract more guests, pushing bookings. Airbnb is the leading player in the vacation rentals. The service has made $9,917 billion in 2023.

We carved out the 5 best hotel booking applications so you can learn from their apps and services offered. The rating is based on the Travel category on App Store and Google Play.

Booking.com is probably the first app that comes to mind when you think of hotel booking app development. With its extensive database of hotels worldwide, it offers users a wide variety of options to choose from. The app's user interface is sleek and easy to navigate, making it a favorite among travelers. Besides basic features like searching and booking, it also provides detailed hotel descriptions, photos, and reviews. The app offers competitive prices and often has exclusive deals for its users.

Expedia is another top player in the market. What sets Expedia apart is its travel platform that not only includes hotel bookings, but also flights, car rentals, and vacation packages. One of the standout features of Expedia is its loyalty program, Expedia Rewards. Users can earn points for every booking they make through the app, which can be redeemed for discounts on future bookings or even free nights at select hotels. If you want to create hotel booking app to provide customers with a cure-all solution for their trip planning, Expedia is a worthy example to learn from.

Airbnb is a popular example of how to make a hotel booking app to provide a convenient customer experience. With its unique concept of renting out private homes and apartments, Airbnb offers a different experience than traditional hotel booking apps. The app allows users to find cozy homes in various destinations, providing a more personalized and intimate experience. The Airbnb app features detailed property listings, including photos and reviews, enabling users to make informed decisions. Moreover, Airbnb often offers competitive prices and the opportunity to interact with local hosts for a more authentic travel experience.

Agodais a great mobile app for booking, especially renewed in Asia, that focuses on providing users with a seamless booking experience. The app allows users to filter search results based on various criteria, such as price range, amenities, and location. The app has partnered with various eco-friendly hotels and organizations to promote responsible travel. Users can easily identify and book environmentally friendly accommodations through Agoda, contributing to a greener and more sustainable future.

Kayak closes our list of the 5 best hotel booking platforms. It's a comprehensive travel app that covers not only hotel bookings but also flights, car rentals, and travel itineraries. One of the unique features of Kayak is its "Explore" feature, which allows users to discover new destinations based on their budget and travel preferences. By simply entering their desired budget and travel dates, users can explore a world of possibilities and find hidden gems that they may not have considered before. This feature adds an element of excitement and adventure to the travel planning process, making Kayak a promising example to pay attention to when planning hotel app development.

Hotel app development is a winning move for all parties involved, offering benefits to app owners, hoteliers, and guests. Let's figure it out.

The primary reason for going to hotel booking app development is that you can generate steady income if you give guests what they want from you. What’s important to realize, you don't have to own a hotel to start developing the hotel software. For instance, you can build a metasearch application and make money via commissions and premium features.

Additionally, partnering with travel service providers lets you produce additional income flows through referral programs. A well-designed ratings system creates trust, engaging more users to your solution, thus, increasing business capitalization.

With hotel reservation app development, hotels can send personalized notifications, offer special deals or promotions, and address customer queries or concerns promptly. Hotel booking apps also open up new revenue streams for hotels. These apps can be designed to offer additional features such as room upgrades, in-app dining reservations, or complimentary services.

By upselling these value-added services, hotels can increase their revenue per guest. Moreover, the apps can also integrate with partner services like tour operators or transportation companies, further boosting revenue opportunities.

Mobile app development for hotel booking makes it easier for guests to find the answers they need while planning the trip and allows them to book everything with just a few clicks. In the age of instant gratification, this opportunity is worth a lot.

Mobile hotel booking technology that remembers customer preferences enhances the booking experience. By automatically recalling preferred room types and locations, it ensures a more personalized experience and pleasing stay for guests. Imagine being able to choose your favorite room with just a few taps on your phone, or having the app suggest nearby attractions based on your interests.

From tech points, MVP (Minimum Viable Product) features refer to the core functionality your hotel booking app must include to implement its solution logic. For you, as a startup entrepreneur or hotel owner it is a cost-effective way to validate whether your app idea is worth the investment. Below are the key functionality for hotel apps to implement.

This is one of the basic features to consider in hotel app development. It allows you to establish personal touch with each user, link information to a particular person, and use entirely retargeting and marketing tools. The important detail here is to let users utilize the core functionality of your hotel booking app in a guest mode without creating a profile.

On top of that, it’s vital to provide several registration options (e.g., email/password + social media account). This step can help you double the user base. However, email/password method is time-consuming, and a part of your users may abandon registration. In turn, the Social Login feature makes the whole process faster and more convenient for the users.

Your online booking engine should work flawlessly. If the search flow is too slow or complicated, users won’t use your app. To facilitate the searching process, you should provide users with the following parameters:

• Destination (city, hotel name, or its address)
• Date (check-in/check-out dates)
• Number of people and information about pets
• Number of rooms
• Other individual parameters (like rooms for people with disabilities, guests with pets, or rooms with special prices)

There are some additional features to improve the searching process:

The main purpose of any booking app is to let their users find a place for a stay with ease. That's why booking app development demands a well-thought-out booking screen.

Don't overload it with unnecessary details, making sure it has appropriate fields for all the important data.

It's also a good idea to integrate the location tracking feature. It's especially suitable for last-minute bookings. A simple 'Near me' button on the booking screen could make the user experience much better.

Here is a concept of flight booking our UI/UX designers have created. It's booking parameters are pretty similar to the ones for hotel booking apps.

It's logical that after users have entered all the booking details, got search results and applied filters to them, they will probably want to take a closer look at chosen accommodations.

To create a hotel booking app, you should ensure the presence of the following data on your accommodation details screen:

• Photo gallery
• Map
• Price details
• Basic information (address, stars, etc.)
• Hotel facilities & policies
• Call-to-action button
• Sharing button
• Add to favorite button
• Reviews

These are some of the basic information most travelers would like to be aware of before booking the stay.

Finally, the user decides to book a stay and pay for it via your app. The payment stage can be divided into 2 stages:

• Checkout. At this stage, users need to submit (if they haven’t registered before) or confirm their personal information. So, create a screen where users could see all the necessary information regarding the stay.
• Payment handling. To make in-app payments processing possible, you’ll need to integrate a payment gateway in your app. At this stage, it’s better to cooperate with an experienced software development company.

You either have it, or you don't. However, keep in mind that users want to feel protected and appreciate the opportunity to cancel their booking in case of an emergency.

Some hotel booking providers allow users to cancel their requests or rebook until the last day. This option is attractive to customers but causes difficulties to hotel owners and OTAs. Fortunately, most hoteliers apply an anti-cancellation strategy in hotels.

Hotel booking app development isn't only about basic functionality. Your product must be packed with features that would be the icing on the cake for users. There are several ideas you can make use of and adapt to your vision.

This is vital as you want the customers coming back. All the information about the users and their booking history will be stored in the user profile. Besides, it enables users to make wish-lists, select a language, currency, and more. You’ll be able to send your clients personalized offers based on the information gathered from the profile.

Suggestions are always a good booster for conversion. Especially the ones based on user search queries and personalized for their objectives.

For instance, Booking.com suggests alternative destinations, while TripAdvisor has included ‘Just for You’ custom hotel recommendations. You may also provide users with alternative dates or routes, flights, car rental deals, local events, and entertainment.

Price changes or lack of accommodations due to seasonal demands, holidays, or whatever is a great motivator for the user to book a hotel right away which undoubtedly influences your earning. All you have to do is inform users about peak demand, say prices that will go through the roof, and offer to book accommodation beforehand.

To build an algorithm forecasting accommodation availability and prices, your specialists in software development service have to feed it with historical data. The data may include the following:

• Seasonal demand & trends
• Special offers by airlines
• Other deals

Underneath, you can see how Airbnb informs their users about possible difficulties in booking an apartment for the set date. They don't only generate more profit in this way but care about their customers too.

How to make a hotel booking app to engage users? Virtual travel agents will improve travelers' experience by providing 24/7 support and navigating through the most common concerns. In fact, travel bots offer a range of services: from the search for hotels to booking a stay to overall trip management.

Push notifications and alerts are another way to earn more and bring a better user experience at the same time.

Here are several ideas on how you can utilize them in your booking app:

• Check-in / check-out alerts. Remind users that it's time to check-in or out of the accommodation. You may not believe it, but such a notification can be really helpful.
• Interesting places and activities nearby. Become more than just a booking app for your users. Tell them what they can do in the city of their stay and send them notifications when they pass by interesting places.
• Special deals, offers, discounts. You certainly should use push notifications to inform users about upcoming sales that can be of interest to them.
• Weather info. Another useful application for push notifications.

So, you are aware of how to make a hotel booking app of your own and what features to add. It's time to look into the future and determine the most suitable monetization strategy. There are three monetization models that fit really well to any hotel booking app. Let’s have a look.

A commonly employed strategy in the hotel booking industry is partnering with hotels and receiving a commission for every booking made through your app. This allows you to earn a percentage of the hotel's revenue while providing them with increased visibility and bookings. Examples of hotel booking services that utilize this model include Booking.com and Expedia.com.

Another monetization strategy within hotel apps development is to offer premium features through in-app purchases or a subscription model. These features could include exclusive discounts, personalized recommendations, or enhanced customer support. By providing additional value to users who are willing to pay, you create a sustainable revenue stream while keeping your app accessible for those who prefer a free experience.

In-app advertising is a common way to generate revenue from the app, including hotel booking apps. By partnering with relevant advertisers, you can display targeted ads within your app's interface. These ads can be in the form of banners, interstitials, or native ads. However, it's crucial to strike a balance between effective advertising and not overwhelming the user experience. Users should still find value in your app while being exposed to advertisements.

As an IT company that offers hotel booking app development services, we’ll describe how the software app development process works at Cleveroad.

It all starts with a hotel app development application you left on the vendor’s website. It is sent directly to the Business development manager. After processing the request, the manager gets in touch with you to discuss your project’s details and terms of cooperation.

The goal of this stage is to connect your business needs in a hotel booking app with technical realization. We actively listen to you and your needs and tailor our IT offerings to align with your commercial goals. The stage is free of charge and takes approximately 2 weeks to complete.

At the end of this stage, we form the proposal. The proposal deliverables include:

• Value stream Diagram
• High-level Feature List.
• Architecture Diagram.
• Software Architecture Document (SAD)
• Team composition and tech stack.
• Approximate estimation by sprints (time-boxed duration)
• Rough total cost of your hotel booking app
• Relevant projects we delivered

Discovery phase helps to organize the project information. Business analysts gather tech requirements and formulate a detailed project specification along with a clear development plan. Based on the collected information, the business analyst makes a final project estimate. Apart from that, UI/UX designers make wireframes for each app screen.

Once all wireframes are made, designers start making mockups for your future hotel booking app (screen by screen). They combine wireframes designed during the previous stage, project requirements, and modern UI/UX methodologies to create a top-notch app prototype aligning with your personal vision and corporate style. After that, the UI/UX designers submit the project to developers and take a supporting role. This is one of the UI/UX design services we offer before the hotel reservation app development.

The hotel booking app development stage is about transforming eye-catching mockups into a working hotel booking mobile app under the approved requirements, including coding, testing, and deployment. Development is divided into sprints (fixed periods) during which the team has to complete a specific part of the work.

We’ve also prepared a list of tools that our app developers used in commercial projects to build software solutions for Travel and Hospitality:

Web architecture:

• Backend: Python, Node.js, Java, Ruby on Rails, PostgreSQL, RESTful API
• Frontend: JavaScript, React.js, Redux

Mobile architecture:

• iOS: Swift, Objective - C
• Android: Kotlin
• Cross-platform: Flutter, React Native

AWS infrastructure:

• EC2
• S3
• Lambda functions
• Cloudfront
• Route 53

3rd-party integrations (some examples):

• Payment gateways
• Google Maps API
• Google analytics
• Twilio
• Firebase Cloud Messaging (FCM), etc.

During this stage, QA engineers conduct multiple tests to make sure the software is bug-free and meets all specification requirements. When tests are completed, QA engineers enter results into bug reports and give them to developers. Bug reports show the state of the app’s functionality during which the problem appeared. This information helps developers to find the bug and fix it at once.

The development team makes final polishing to ensure the hotel booking app works as expected and ready for release. Once polishing is over, the app is launched on target markets to get initial feedback and make improvements if required. In some cases, the cooperation doesn’t stop after the app is built. The team can support the app by adding new features or updates and maintenance the product based on users’ feedback.

Let's now consider the time and cost you need to create a hotel booking app.

Keep in mind that software developers aren't the only specialists you need on a team to create hotel booking app. Here's the full team composition you'll need:

• Front-end developer
• Back-end developer
• UI/UX designer
• Business Analyst
• Solution Architect
• Project Manager
• QA and DevOps engineers
• Team lead

Given that team composition and the amount of work, it'll cost you $150,000-$200,000+ to create hotel booking app.

At Cleveroad, we provide travel and hospitality software development services to build unique digital solutions for automating booking processes and managing travel activities. We’ll create software that helps you keep all hotels in one place and manage them using different criteria like affordability, availability, comfort level, and more.

For instance, we’ve helped a Singapore company to build a Koralgo, web-based platform for travelers to find travel activities and accommodations. The advanced features of the platform include three unique searching and ranking algorithms, allowing users to receive the most relevant offers. Our dedicated development team ensured the high quality of travel software, which increased the business capitalization and attracted investors to further develop the product.

You’re welcome to explore ‘Web Platform for Searching Travel Activities and Accommodation’ case study in more detail.

Here's what a founder & CEO of Koralgo, Sylvain Labattu, tell about their experience working with Cleveroad on travel platform engineering. You can check the client feedback on our Clutch page.

• Proven experience in software development for Travel and Hospitality to address specific industry challenges, such intuitive design with easy navigation, real-time availability and pricing features, localization functionality, and more
• We have successful projects in travel industry in our portfolio and satisfied clients who have benefited from travel and hospitality software development services
• Proficiency in integrating your hotel booking app with third-party services and solutions, such as Map and Location services, Property Management Systems, Google Analytics, hotel CRM, etc.
• Full-cycle software engineering services to build/modernize and release custom hotel booking software that helps automate travel activities and increase user engagement
• Cooperation with ISO 9001 and ISO 27001-certified company, assuring the quality and data security of your hotel booking application
• All-out Project Management Office for overseeing your project performance, ensuring timely delivery with regular reports, workshops, and demos