Expedia Is Trying to Become More Like Booking.com in Key Areas
Skift Take
Expedia's moves to lower commissions, tack on a tactical bidding program for hotel displays, and make itself friendlier to hotels and consumers by offering a pay-at-the-hotel option are all designed to ramp up Expedia's business and to make Booking.com's so-called "competitive moat" a little less imposing.
You might call it the Booking.com-ization of Expedia.
Expedia's recent launch of its hotel Accelerator program, which enables properties to bid to move higher in search results on Expedia hotel pages based on paying higher-than normal commissions, is the latest example over the past few years of big business model changes Expedia made to parallel initiatives that Booking.com pioneered years earlier.
Competitors routinely copy features or products that have worked for their rivals but these changes that Expedia has made in recent years are major alterations.
Booking.com's Preferred Property Program has been around for more than a decade. It enables hotels to move up the sort order when they pay extra commission and, as with the Expedia Accelerator program, meet certain performance requirements. Unlike Expedia, Booking.com identifies participating properties with a Preferred Hotel Partner logo.
Lowering Commissions For Hotel Chains
It may seem counter-intuitive, but Expedia's introduction of its Accelerator program, which entices hotels to pay higher commissions in times of occupancy challenges, is closely tied to another Expedia business model change that gets it more similar to Booking.com -- a drive to lower the commissions that big hotel chains have to pay.
As we outlined in 2012, when describing How Booking.com Turned the Other OTAs Into Converts, Booking.com historically managed to scale its business, in part, by using an agency model with lower commissions
