In their ongoing tug of war with online travel agencies, hotel companies have launched some clever campaigns in recent years to steer more consumers to their branded sites for commission-free direct bookings, promising that travelers always will find the lowest rates there.
But a new study indicates it still pays to click around.
A survey by the research firm Piper Jaffray found OTAs and travel search sites offered the lowest rates more often than hotel brand websites.
The survey of 1,000 U.S. customers who reserved rooms at 86 chain hotels in the world’s largest 25 cities found that OTAs and travel search sites had the lowest price 21 percent of the time compared with 13 percent for hotels. Pricing was the same about two-thirds of the time.
The researchers told Skift they had expected to find more price parity, and that the results show consumers are not shifting despite hotel company marketing efforts.
The American Hotel & Lodging Association questioned the validity of the results, and Hilton and Marriott told Travel Weekly that direct bookings are the only way for customers to get the guaranteed lowest rate with all the perks afforded members of their loyalty programs.
It’s certainly easy to understand why hotels are trying to drive more direct bookings. It’s not just about saving on what they say are sometimes unfairly large commissions. More importantly, it’s about preserving a direct link to the customer and collecting that all-so-important information needed to deliver personalized service and conduct future marketing efforts.
Unfortunately, the internet and OTA floodgates opened long ago, and to borrow the catch phrase from Hilton’s clever campaign, travel shoppers love to “click around” to find the best deals and properties that best fit their needs.
We call it the look-to-book factor, or how many clicks (“looks”) there are for every booking. And it’s a whopping 11,000-to-1, according to the data from the nearly 13 billion hotel booking transactions we process every month. That’s a whole lot of clicking.
Add in the movement to overturn rate parity laws in Europe and the seemingly endless number of new players entering the online travel landscape, I expect the clicking will only increase.
For instance, one of our newest partners, Zumata, is using artificial intelligence to quickly gather information across a host of new wholesalers and other suppliers around the globe. And the meta sites give consumers easy access to an increasingly wide variety of deals.
So while many seasoned and loyal travelers no doubt will take advantage of the special rates and bonuses that brands offer for direct bookings, the Piper Jaffray report serves as a reminder of the value of industry players working together rather than against each other to embrace new technologies that ultimately will drive more bookings and more revenue for everyone.
– Toni Portmann
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