Google’s Quiet Moves to Dominate Hotel Metasearch

Last week we launched the latest report in our Skift Trends series, The State of Travel Metasearch in 2015.

Below is an extract. Get the full report here to get ahead of this trend.

In 2009, Steve Hafner of Kayak, which was then an independent private company, said the biggest competitive threat on the horizon for Kayak wasn’t other existing metasearch sites but the prospect that Google, with all its search-engine power, would begin to display hotel pricing.

Google indeed got around to launching a hotel metasearch product, Google Hotel Finder, in July 2011 but it has been a relative nonfactor in terms of market impact in the intervening years — until now.

In November in the U.S., Google changed the format of its Hotel Ad unit from a 4-pack to a 3-pack, meaning the number of hotels with rates shown by default in Google.com search results when users query “Chicago hotels” or “hotels in Barcelona,” for example. “We immediately noticed a 22 percent week-over-week increase in click volume for Google Local Universal [Google Local search results], which continued to increase throughout the month,” wrote Eric Mendes, a marketing analyst for Koddi.

Rather than users having to click about four times to get from Google.com and through the Google Hotel Finder site to get to the online travel or hotel website to start the booking process, the new ad unit for Google Hotel Ads takes just two clicks from Google.com – and there is no need to go to the Google Hotel Finder site.

Nicholas Ward, Koddi president, says the prior, clunkier Google.com search experience was:

• Click the ad
• View the hotel list on Google Hotel Finder
• Click on a hotel selection
• Click a Hotel Ad to navigate to the partner booking site

The streamlined process is:

• Select the hotel
• Click a Hotel ad

“So you can get to the advertiser site in as little as two clicks now,” Ward says. “Google essentially brought Hotel Ads further up the funnel and exposed them to more users than otherwise might not have seen them.”

“There is a lot less friction in the process and as a result we’ve seen traffic grow substantially,” he says.

Ward believes that by the end of 2015, Google could be one of the largest metasearch drivers of hotel bookings in the U.S., at least. “My expectation is that Google Hotel Finder eventually goes away as a separate product,” Ward says. “And all of the features in Hotel Finder get integrated directly into the core Google search product.”

Ward says he’s seeing a lot more competition these days among advertisers using Google Hotel Ads, which enables advertisers to adjust their bids based on a variety of attributes, from targeting vacationers versus business travelers, and that’s a feature that is virtually absent among metasearch competitors.

Ward of Koddi isn’t the only one picking up on the strides that Google is making in its Hotel Ads product.

“I would say for everyone, the two leaders [in Europe] are Trivago and TripAdvisor,” says Romain Roulleau, senior vice president, ecommerce, at Accor hotels. “That’s obvious. One of the fastest growing is Google Hotel Price Ads and Google Hotel Finder, especially with the way they are now putting more of the display in the Google search engine.”

In the past couple of years, major online travel agencies and metasearch players have spent billions of dollars in TV advertising. Now Google is coming on strong in hotel metasearch without doing any TV advertising. Google, after all, has something the metasearch players and online travel agencies don’t have — it has prime placement on Google.

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