TravelCLICK’s eTRAK 2008 study of central reservation system (CRS) bookings shows Internet reservations are up by 1.6% from 2007 and travel agent bookings are down by 5.3%. Voice reservations are up by 3.7%, presumably from the proliferation of cell phones; however, total electronic reservations are down by 3.7%.
As for the sites people are using to book, brand sites dominate the category with just over 75% of total online reservations. Merchant sites came in second, with sites such as Expedia and Travelocity being used for about 10% of reservations, while Opaque sites like Priceline followed just behind, claiming 9% of reservations. Retail sites, like Hotel Reservation Services LTD, were used least frequently, with just over 5% of 2008 online reservations.
Essentially, these findings reinforce our belief that a hotel’s Website is its most important branding tool and revenue generator. The site must convey (and convince the guest of) the hotel’s main selling points. It must define very clearly the hotel’s value proposition. It has to provide clear differentiation of the hotel product vs. OTAs and the comp set. It also must be user-friendly and booker-friendly to encourage online bookings. It has to be Web 2.0 and customer-interactivity friendly to encourage return visits and boost loyalty.
In a world where travel agents do less of the hotel’s bidding, the property’s Website must be personal enough to sell itself as the ideal fit for each interested party. And in today’s economic environment, Website optimization and fine-tuning are both simple and affordable measures to take to increase revenue.
Reservation Sources for Major Hotel Brands
Internet Source Breakdown for Major Hotel Brands
(1) Brand Website: Website where distribution is operated and managed by the brand (e.g. The Marriot’s website).
(2) Retail Website: Third-party distributor where the hotel lists inventory at the same price that it is sold to the consumer and hotel pays distributor agreed upon commission (e.g. HRS, Bookings, Venere in Europe).
(3) Merchant Website: Third-party distributor where the hotel provides inventory to the site at a net rate. The merchant marks up the rate by an agreed upon percentage. The consumer pays the merchant at the gross rate and the merchant site pays the hotel the net rate (e.g. Expedia/Hotels.com, Travelocity and Orbitz).
(4) Opaque Website: Third-party distributor that enables customers to choose a fare or rate without knowing the brand of the supplier until after the item is purchased (e.g. Priceline).