Greed may or may not be good, but in travel metasearch complexity is good. New rules in Europe may make searching for a hotel room online all the more difficult.
Despite contracts between hotel chains and online travel agencies that mandate all distributors get the same room rates as displayed on the hotels’ own websites, in recent years there have been plenty of pricing disparities, irregularities, and promotions to make comparison shopping worthwhile.
But the news from Europe this week that Booking.com, the leading online hotel player, has reached a proposed agreement with regulatory authorities in France, Italy, and Sweden that would enable hotels to give one room rate to Booking.com and a lower or higher one to competitors could turn out to be one of the biggest shots in the arm to travel metasearch players such as TripAdvisor, Trivago, Kayak, Skyscanner, Hipmunk, Hotelscombined, and Cheapflights since their creation.
Of course, the Priceline Group acquiring Kayak for around $2 billion in 2013 and Expedia Inc. following along and obtaining a majority stake in Trivago for $632 million were huge developments, too.
But the changes in most-favored nation clauses, as the hotel pricing rules are called, are potentially earth-moving and their ultimate impact would depend to what degree hotels decide to implement the new parameters and introduce disparate pricing by distributor on an ongoing or tactical basis.
Once travelers realize that the room rate on Expedia may be significantly lower than the one offered on Booking.com, or vice versa, then there would be all the more reason to use a hotel metasearch site to compare all of the available prices at once rather than start the search process on an online travel agency site or even the hotels’ own websites.
“Travelers are looking for value and convenience when shopping for a hotel,” says Jon Eichelberger, regional manager for Trivago North America. “More price disparity makes it a bigger challenge for travelers to know where to find value, and meta absolutely helps in bringing additional price transparency to the market.”
A spokesperson for Skyscanner declined to comment on the issue.
Metasearch players love it when pricing gets messy and travel research gets complex. All the more reason for travelers to use these price-comparison sites.
With the new rules, if they are ultimately adopted, searching for hotel rooms could get a lot more complicated, not less.
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Photo credit: Proposed rule changes in Europe about hotel prices may spur travelers to use travel-comparison sites even more to figure out which company offers the lowest room rates. Pictured is the pitchman for Trivago, Europe's Trivago