Amazon Abruptly Shuts Its Hotels Business After Stilted Efforts to Compete

Amazon, which in April moved beyond selling deeply discounted hotel rooms into a more well-rounded hotel-booking business, abruptly shut down its Amazon Destinations service entirely with no warning.

A notice on the site states: “Effective October 13, Amazon Destinations stopped selling reservations on travel.amazon.com and the Amazon Local app. If you have a reservation, your reservation is valid and will be honored by the hotel. No action is required on your part.”

Even some Amazon sales representatives who worked with the hotel industry were blind-sided by the shutdown, apologizing to their accounts.

Asked to explain the reversal, an Amazon spokesperson said: “We have learned a lot and have decided to discontinue Amazon Destinations.”

Several online job postings for Amazon Destinations have been withdrawn, although this one from October 7 for an executive assistant, Amazon restaurants and travel, was still being offered today.

Asked about it, the Amazon spokesperson pointed out that it covers restaurants deals, which are still being offered, as well.

One hotelier who was working with Amazon expressed shock at the announcement when Skift informed him of it.

“I can tell you that my relationship with Amazon has been great,” the hotelier said. “They have really injected a lot of energy into the program, have really been working with me almost on a daily basis to improve our listing but also improve their product. We just gave them a ton of “seasonal” content, which we will continue to do and they plan on being very fluid/seasonal and informative. So it’s been going well. We have gotten a handful of bookings thus far, a lot of traffic to our listing and as a referral, just working on the conversion now.”

On the other hand, Amazon’s efforts seemed to have lacked clarity for some time. Amazon had been in the business of selling discounted rooms for years, and then earlier this year gave hoteliers more flexibility by selling rooms in a larger number of destinations at published prices.

There was the prospect that Amazon would emerge as a serious contender in the online hotel business.

But people who have spoken to Amazon hotel personnel about their efforts indicate that it was clear that the company at times didn’t really know what it wanted and, for example, was struggling over issues that other online hotel sites had struggled with and resolved years ago.

Despite the wealth of data that Amazon has about consumer behavior and its reach, Amazon Destinations was a relative dud.

It was telling that when the U.S. Department of Justice reviewed hotel competitors during its analysis of Expedia’s acquisition of Orbitz Worldwide, the antitrust division cited TripAdvisor and Google as rising competitors but didn’t mention Amazon.

Is Amazon now out of the hotel business forever? A spokesperson declined to comment on that prospect.