Online travel agencies such as Expedia and the Priceline Group providing business services to hotels is seemingly the new normal. It's easy to understand how this would be valuable to resource-strapped independent hotels but the degree to which major chains sign-on remains to be seen.
If you can’t beat ’em, then join ’em — or at least get a piece of the pie.
As major hotel chains embark on campaigns to push direct bookings on their own sites, Expedia Inc. has been testing programs since early this year in which it would help power such efforts, Skift has learned.
Cyril Ranque, Expedia Inc.’s president of lodging services, says the pilots have been under way with several chains, including one particularly large one, although Expedia “paused” at least one of the tests when the chain decided to withhold its lowest rates from Expedia.
Expedia argues that both property owners and the chains themselves are hurting their own revenue-generation efforts by withholding rates from online travel agencies and are negatively impacting consumers who value comparison shopping on OTA sites.
Seeking to establish a new revenue stream and forge closer relationships with chains, Expedia believes it can offer hotels white label and technology services to assist their revenue management efforts, provide data to get a better handle on hotels’ upcoming demand, and use tools to make hotels’ marketing more efficient, Ranque says.
If it seems counter-intuitive that Expedia would seek to help hotels take share away from online travel agencies such as itself, then the value proposition might depend on the precise nature of the business model, and details about revenue-sharing.
Major players in online travel such as the Priceline Group’s Booking.com with BookingSuite, TripAdvisor and Expedia’s own Trivago have launched such businesses over the last year to power hotels’ marketing efforts or certain of their business processes.
Asked how Expedia’s plans might differ from Booking.com’s BookingSuite, Ranque said: “We have more constructive discussions with chains than Booking.”
A Booking.com spokesperson didn’t immediately respond to a request for comment.
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Photo credit: Expedia Inc. is looking to become a bigger player beyond consumer booking and do more to help hotels cut out middlemen like themselves — sort of. Skift