Notice gap in existing system-> Innovate -> System changes and breaks in a new way…

Back when travel agents ruled the world, of travel at least, 90s websites such as hotel and flight booking websites came along to save you money by offering deals on “leftovers”. The “system” at the time was primarily driven by travel agents and direct bookings. So there was a genuine leftover stock that could be snapped up by booking websites and offered to the tech-savvy at real discounted rates.

Then the system changed. Everybody was online. Everybody heard about the savings to be had from the booking website. More importantly, they saw how convenient it was to book through these websites. Suddenly the room stock coming to these websites wasn’t the “leftovers” but proper allocations. The savings were no longer there. But travel websites still continue to claim that they are offering the best price.

The ACCC fined Trivago last week for making the best price claim when in truth, consumers would often get a better price by calling the hotel directly. The reason for this is that listings on Trivago are not free. So if you call a hotel and ask to better a rate you saw on Trivago, they can do it because they are NOT getting the rates on Trivago. They are getting the rates minus Trivago’s commission. So they can often better the rate and still end up with more money in their pocket.

However, we as consumers pay with our time for the additional savings. So many accept the best deal they can get on a comparison site for the convenience of it. But the short term convenience is contributing to a long term increase in the cost of living because it’s not just about travel.

Insurance, utilities, and almost everything you can think of have middlemen who contribute little but add costs that are borne by the whole market. The system is broken, but it's ripe for disruption and innovation.

Kyco is a startup that’s trying to disrupt and innovate by being a collective that negotiates better deals as a group. Trond Smith, the CEO of Kyco, is genuine in his advocacy for the consumer. He’s launched the Great Australian Rip-Off campaign to get some political will behind reforms that are necessary to the system as it now exists.

I do not know if Kyco will succeed in changing the current system. However, it is the one I am putting my energy behind at the moment. What I do know is that the system is broken and so we have the opportunity to innovate, create a new system and then watch it break in new ways.