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Google on Tuesday changed how its hotel price-comparison search works worldwide. The search giant made it free for hotels, online travel agencies, and metasearch brands to list room rates in its boxed pricing module for individual properties.
Google has long had a price comparison tab on any given property’s listing within its hotel search interface — found via google.com/travel. Until Tuesday, the search titan only showed paid advertisements when users clicked on the “prices” tab. It has now made those booking links free. It hopes to entice hoteliers and resellers to participate more.
“This will be a big boon to users coming out of the pandemic who are eager to travel again,” said Richard Holden, vice president, product management, travel at Google. “This is also an opportunity for us to show that we have a full range of pricing.”
The move comes as the pandemic has dried up travel advertising.
Google Woos Hotels
The company has been testing the free booking links for “a number of months” and has gotten “positive user engagement,” Holden said.
“From the largest OTAs [online travel agencies] to small hotels, across the board, we’re driving more traffic for the ecosystem as a whole,” Holden said.
Google will continue to display “Hotel Ads.” The company will keep up to four of these labeled hotel ads in any given hotel booking module.
When a person searches for, say, “hotels in Dallas,” and then clicks to see an individual property listing in that city, Google will fetch rates that it calls “organic” results (under the ads, if Google sells ads).
A hotel’s direct listing might not appear at the top of the results. Google will use several factors to decide what order to rank the hotel listings on a property’s pricing tab, Holden said in an interview. The factors include price, quality signals that Google chooses about the accuracy of the pricing from a brand, and data about users’ past engagement with a brand. Google doesn’t let consumers sort its organic rate results by price.
A Few Caveats
Until today, Google’s boxed hotel search module on a hotel listing often included a note explaining that the company displayed ad-based rates from resellers such as Expedia, FindHotel, Tripadvisor, and Trip.com reflect “non-public prices” that Google’s users were “eligible to use.”
It was unclear if non-public prices would be part of the free booking links. Private rates let a company offer reduced rates for members of an audience list or loyalty program.
These “non-public” rates aren’t wholesale rates meant for offline sources — which have been a source of controversy.
As a side note: Skift hasn’t seen Google include Booking Holdings brands in its public notices about which brands take part in its non-public rates offering.
Google Differs in Its Approaches to Flights and Rentals
Google varies in its approaches to different merchant categories.
Take airlines, for instance. In some markets, such as in the U.S., it’s rare for consumers to see online travel agencies advertising against major airlines for many Google metasearch results for specific itineraries. Some experts said that reality reflects how a handful of carriers dominate the airline sectors in select markets.
Consolidation gives airlines the power to haggle for a favorable array of “organic” results. But the hotel sector is more fragmented. So hotels compete with resellers in Google’s organic rate results for individual property listings.
Google’s vacation rental search product remains in its infancy. It lacks a comparable user experience to the hotel search product.
“We don’t have any paid element in our vacation rental product today,” Holden said.
Google’s vacation rental listings are unique to each partner, and the company doesn’t offer a multi-partner comparison of rates. Google turns to intermediaries for its vacation rental content, though occasionally some property management companies are large enough to give the rates and inventory, Holden said.
Google’s challenge with vacation rental content is that it hasn’t yet cracked the problem of avoiding duplicate listings. That’s a problem the company’s working on, Holden said. Solving the duplication issue might lead the company to build a vacation rental search parallel to its hotel search.
One point to call out: The hotel booking module found via google.com/travel differs from the module triggered by a consumer’s hotel search on Google’s homepage (which shows an organic list of multiple hotels). If a person searches from the Google home page on “Dallas hotels,” for example, they may see a box with four hotels and their rates. Ad placements don’t drive those, Holden said.
Google Talks Broader Shift
Google said the change in its hotel product represented a broader rethinking that the company had contemplated for a while.
“It’s a structural change,” said Holden. “We’ve been thinking about making sure we have comprehensiveness for users and that we have broad ecosystem participation. The pandemic probably accelerated our thinking.”
The search giant has made a few changes beyond its hotel product in the past year-and-a-half.
In April 2020, Google added more organic links within its consumer shopping search tool to bring more merchants on board.
In January 2020, Google changed its flights product to offer free lead generation to airlines.
Google Looks for a Travel Recovery
Google doesn’t share staffing numbers. But Holden said Google’s team tasked to covering travel “hadn’t been immune to the effects of the pandemic.”
“Travel’s been down, and we’ve sized our efforts based on that,” Holden said.
So some Google staffers presumably hope the free hotel listings help speed up a rebound in the company’s ad revenue. The move comes a few months after Google debuted new “traveler demand tools” for hotels and destinations, starting in Asia.
Good News for Tech Vendors
The change in hotel search could boost several tech integration vendors, which help hotels with connectivity and distribution.
“It’s quite possible that hotels are going to turn to their integration partners and say, ‘Hey, this looks like a great opportunity for us to engage and reach out to consumers as well,'” Holden said.
“We know through our data that direct bookings have grown to become one of the top sources of online revenue for hotels globally,” said Dai Williams, chief growth officer at SiteMinder, in an interview. “In 2020, among hundreds of distribution channels, direct hotel websites produced the second-highest volume of revenue for hotels in markets, such as Spain, Ireland, Portugal, and Australia.”
Google separately plans within “the coming months” to roll out a basic extranet that would let hotels upload their rates and inventory without needing an integration partner.
Yet simply adding rates and inventory to Google may not be enough to have enduring success worth the effort.
“They’re giving hoteliers the opportunity to take more control of their booking process,” said Adam Harris, co-founder and CEO of Cloudbeds, a hospitality tech startup. “But, it’s not as easy as flipping a switch. To compete with major OTA [online travel agency] platforms, hoteliers will need to take full control of the entire customer journey — from pre-arrival communication to guest reviews.”