Hotels are beginning to leverage the power of travel agent partners in their conflict with online booking sites.
Last week, Skift reported on the likelihood of online booking sites like Expedia and Priceline being able to offer hotel direct rates to consumers.
Yesterday, news broke from The Company Dime that hotels are already offering direct rates through global distribution system partnerships with travel agencies. Hyatt Hotels and InterContinental Hotels Group (IHG) are tabbed as the first two hotel companies to begin to implement this strategy.
One source told Skift that certain preferred travel agencies are being given access to codes that let them book hotel loyalty program rates through global distribution systems.
These lower rates are also commissionable for agents.
Another source told Skift that the use of the code is a way to get around strict rate parity agreements between hotel chains and online booking sites.
Direct rates that aren’t available to online booking sites usually aren’t allowed to be bookable on global distribution systems, due to these contracts, but hotel companies want travel partners to be able to book their clients with these rates. Thus the implementation of these new “special passwords” that allow agents access to the preferred rates.
“Some of these hotel brands are smart enough to put the value at brand.com, and also travel management company partners,” said a travel agency executive. “The hotels are trying to walk a slippery slope; the [online bookings sites] are still driving a lot of volume… but if we have a downturn in ’17 or ’18, these hotel companies do not want to turn that faucet off completely. The reason why there’s always a part for travel partners is that we always drive the best rates.”
Hyatt would not share any specifics, but a representative passed along this message:
“The Hyatt Gold Passport member discount rewards members for their loyalty, and many of our members book their travel through our valued agency and corporate partners. The discount has always been available to these agencies, and we have taken steps to make it seamless for agencies to book it for our members and their clients.”
IHG shared a similar statement:
“IHG greatly values our travel agency relationships. Over the coming weeks, we are working to ensure that Your Rate by IHG Rewards Club is available in the GDS as we know this is a critical booking channel for our travel partners. These rates will also be commissionable for travel agents.”
Sabre Travel Network and Amadeus declined to comment on the subject, while Travelport has yet to submit a statement on the issue to Skift.
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Photo credit: A Hyatt hotel in Austin, Texas. Thomas Hawk / Flickr