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anonymous

Another rumour quashed then - Amadeus backs growing anti-Google lobby | Tnooz - 0 views

  • The floodgates have opened – last week’s frenzy of activity, when Expedia and then TripAdvisor submitted complaints to the European Commission about Google, has clearly triggered something. To paraphrase, as both pretty much argue the same thing, the complaints centre on accusations of unfair practices in search which, the pair argue, is damaging the industry and consumers. No major surprises there, given that Expedia and TripAdvisor were original members of the FairSearch anti-Google lobbying group in the US. What raised just a few eyebrows was when, a few hours after TripAdvisor’s statement was released, ETTSA (European Technology and Travel Services Association) came out in support of the pair. ETTSA primarily represents the interests of the GDSs, as well as online travel agencies such as Expedia, Ebookers and Travelocity, in Brussels, but the decision to publicly back individual companies effectively puts the GDSs, under the umbrella of their representative body, also up against Google. Fast forward a few days and now Amadeus has decided to publicly back Expedia’s complaint to the EC.
  • Amadeus, alongside ETTSA, is particularly concerned about the likely impact of Google Flight Search, when it eventually expands outside of the current customer base of the US.
  • But for Amadeus, which just a few weeks ago saw its UK MD Diana Bouzebiba suggest again that Google needs partners in Europe, to now also come out in support of the anti-Googlers will speak volumes to those that have watched closely ever since June 2010, when Google first announced its acquisition of ITA Software. Clearly Amadeus is not expecting to be forming a major partnership with Google any time soon. Unless it is some kind of weird reverse psychology, of course.
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    The contention between these OTA's and Google is a bit confusing and requires further research, but I think what is essentially at hand is severe competition. Google Flight has implications to cross over into OTA territory, which puts GDS's in a difficult position: support the OTA's or enter another profitable partnership with Google. Amadeus seems to be backtracking on its stance regarding new Google Flight Search, originally implying forming a partnership with Google, and now stating it is taking the sides of "anti-Googlers Expedia and TripAdvisor.
Ligia Elizondo

The Future of a Revenue Manager 2.0 - Part Human, Part Computer, All Profits | By Jean ... - 1 views

  • The article's data pointed out that as technology evolves, analytical pricing models and social networking/mobile technology are going to have a major impact on the future.
  • Already schooled in the way in which mobile has radically altered the air travel booking and in-flight entertainment experience, hotels guests are using everything from social media to online travel agents, (OTAs) to seek out and locate the best value.
  • With the continued emergence of e-commerce, social media, and travel review sites, RM's have even more to consider than just occupancy and profitability.
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    The article states that future Revenue Managers must be very tenacious in balancing the power of technology and managing the data process. With the advances of technology, social networking, e-commerce, online travel agencies, and mobile technology e-business have a great impact in our industry. Mourier claims "Already schooled in the way in which mobile has radically altered the air travel booking and in-flight entertainment experience, hotels guests are using everything from social media to online travel agents, (OTAs) to seek out and locate the best value." With the influence of social media, e-commerce, and travel review sites such as tripadvisor, Revenue Managers have to consider the impact those have in their businesses. Revenue managers need to understand what drives potential customers to stay in their hotels. The future Revenue Manager should possesses technological skills, understand the global market conditions, advances in technology, being cost effective, understand the importance of overall package deals and incentives, familiarize himself with the great impact of social media and advances in technology. "What's the cost-benefit analysis of launching a mobile-enabled web page versus an app and is having both redundant? Admittedly, there's no single answer to these questions and no one size fits all so the sooner RMs and hotel executives begin this conversation, the better," and have great leadership skills. It is really important that hotel managers understand that in todays' world technology can be a competitive advantage of their hotels if the use it adequately.
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    Your description of the article is very enlightening. Revenue managers really need to step up their game if their hotels are to remain in the running. This places a lot of pressure on them, but I like how you addressed their meeting with hotel executives. Perhaps the need for review of e-commerce and social media along with travel review sites will create a new position within the organization, it seems like too much for one RM.
Carolina Ferrer

If Expedia Was Too Powerful for Hotels, Consider Booking.com's Plans - Skift - 0 views

  • Fresh off its acquisitions of Buuteeq, Hotel Ninjas, and OpenTable this year, the Priceline Group is in the process of integrating Hotel Ninjas’ property management system with hotel digital marketing company Buuteeq, according to a report,  Google’s Travel Plans in a Post-Atomic Era [embedded below], written by Ken Sena of Evercore. googletag.cmd.push(function() { googletag.display("div-gpt-ad-1390432568424-0"); }); With the integration of the two cloud-based systems for hotels, the Priceline Group “has the ability to handle property management, channel and rate management, and CRM, all of key consideration to hotelier,” the Evercore report states. “In return, Priceline receives subscription revenues on some of the services provided in addition to keeping these hoteliers’ semi-tethered to its Priceline traffic channel from the standpoint of ease an efficiency, given Priceline’s leading scale as an OTA.”
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    Recently, the Priceline Group has acquired Buuteeq, Hotel Ninjas and Open Table. They are looking to merge Hotel Ninjas' web based PMS with Buuteeq's digital marketing software. Integrating both of these programs would mean that Priceline would be able to offer hoteliers a well-rounded system that could keep track of customer folios and housekeeping processes through cloud based web interface. The Priceline Group has plans to integrate their two cloud-based systems for hotels. Many properties are concerned with the security that Priceline may have in place and they do not want their information getting out to competitors. While the new processes that Priceline Group is offering seem very worthwhile and efficient many properties may buy into it and ignore the security concerns. One of the main considerations of this new venture is that Hotel Ninjas is a young company and the Priceline Group does not have much experience on this end of the industry. These changes could start a fast growing trend with the way online travel agencies and properties are communicating and doing business.
ccpanther88

How Can Hoteliers Take Advantage of the Disruptive Shift from Desktop to Mobile? | By M... - 0 views

  • Last year over 38% of web visitors and nearly 40% of page views were generated from non-desktop devices
  • nearly 21% of bookings and 17% of room nights came from tablets and mobile devices.
  • Tablets generated 226% more revenue and 77% more room nights than "pure" mobile devices
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  • nvesting in your property website to maximize revenue from the three screens
  • Keeping the consumer engaged and reaching them multiple times throughout their journey (through which you will also be competing with the OTAs and other hotel websites) requires using multiple channels to tell your hotel's story.
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    Mark Starkov, President & CEO at HEBS Global provides advice as to how to understand and optimize several tools hotels use for bookings. We live in a world where mobile connectivity is on the rise with no fall in sight. More and more people are spending more time and money on and through these devices, and it is something that our travel and hospitality industries are booming from. In 2014, nearly 40% of web visitors and page views were credited to non-desktop computers. In terms of hotels, these devices can also account for over 20% of bookings and 17% of sleeping room nights. Between 2013 and 2014, hotel revenue generated via tablets more than doubled and booked over 77% more room nights than non-"pure" devices. These stats alone should have all hoteliers seeing opportunity. The world of e-commerce is allowing hoteliers and other travel companies to open up many revenue streams. Between DGS, OTAs, and CRM, we are able to reach a much wider audience and bring in an exponentially larger amount of business. These tools do not work for free, as there are often commissions or subscription fees these companies are compensated for. As valuable as these third-party tools are, it is equally important to invest in your direct-booking outlet. Booking direct business keeps the most money in your pocket. Not only will you get optimum rates, you will also save on commissions, referral fees, etc. Just imagine not having to pay a third-party commission of 10% of a $100,000 dollar piece of business. That's 10 thousand saved. Sometimes, when large corporate events are booked, there can be two referral services involved, resulting in 15% commission payout. In terms of direct vs. third-party business, a hotel could not survive on only one.
sbarr011

Changes to Accounting Standards to Impact the Hotel Industry - 0 views

  • In order to determine if revenue should be recognized on a “gross” or “net” basis, one needs to understand what flexibility the OTA has to discount the room rate, charge additional fees to a guest, or combine the room night in a package with other goods or services (e.g. flight, rental car) under the Merchant Model.
  • One of the changes to the accounting standards is on revenue recognition, specifically how revenues from Online Travel Agents (“OTA”) should be recognized. Currently, there are two models for the treatment of OTA revenues in the hotel industry:
  • Retail ModelGuest makes the reservation via the OTA but pays the hotel upon stay. Hotel remits commission to the OTA. Currently, the hotel recognizes revenue at the gross amount of cash collected (i.e. the total room rate), offset by a commission expense to the OTA. Revenue recognized through this model is typically recorded on a “gross” basis.
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  • Merchant ModelGuest makes the reservation via the OTA and pays the OTA up-front. The OTA remits cash, net of their commission to hotel. Currently, hotel recognizes revenue at the net amount of cash received (i.e. the total room rate less the OTA commission), hence revenue recognized through this model is typically recorded on a “net” basis, which means a lower amount of revenue is recognized than under the “gross” basis.
  • he new standard requires the party who is the principal in the sales transaction to record the revenue on a “gross” basis. How is the principal determined? An entity is the principal in a transaction if it controls the good or service before that good or service is transferred to the customer.
  • Since the hotel is primarily responsible for providing the stay, the OTA does not take any inventory risk, and the price of the hotel room is largely determined by the hotel, the new accounting standard would indicate that revenue recognized from the Retail Model and Merchant Model should be both recorded on a “gross” basis, whereas previously, the revenue from the Merchant Model was paid on a “net” basis.
  • significant to hotels, as this will increase the amount of costs which are calculated as a percentage of revenues (e.g., credit card fees, management and franchise fees, sales taxes).
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    Beginning in 2018 the financial accounting standards for hotel business are changing. One of the changes is the way OTAs charge for the rooms. Typically the OTAs operate under two methods the retail model and merchant model. The retail model uses the OTA to reserve the room but the final payment is made to the hotel. The hotel then gives a commission back to the OTA. Under The merchant model the payment is made to the OTA. Then the OTA takes the commission off and sends the remaining payment to the hotel for the price of the room. This comes out as a net transaction. The new standard is saying that the company that controls the transaction for the room has to mark the transaction or sale as a gross transaction. The new model forces the hotels to record the transaction on a gross basis. This can be a big difference for hotels because now they will have to increase the amount of costs and reduce the hotels bottom line.
dstic005

Another Move by The OTAs That Is Harmful To Hotel Profitability - What You Need to Know... - 0 views

  • Here is how the Add-On Advantage Program works: After customers book an airline ticket (Step 1), Expedia sends them an email (Step 2) with steeply discounted hotel rates in the destination the customer is flying to, pushing customers to book a hotel in addition to the airline ticket they have purchased. The problem for hoteliers is that the steeply discounted hotel rates Expedia is offering in Step 2 are from Expedia’s Package Booking Program and these rates are not meant to be sold unbundled, i.e., “naked.”
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    This explores how the OTA Expedia is bypassing the rules of the rates they are given by hotels to show unauthorized prices and thus affecting how the customers shop for rooms in the future. Customers will see these lower rates, which are only meant to be sold as part of a larger package, then compare them to the hotels site, which of course will be higher and in the future disregard the direct buy from the hotel, not knowing that the rates they were given should have never been available without a package which includes airfare and car rental.
anonymous

TravelClick: Mobile and Digital Bookings Continue to Rise | Hotel Business - 0 views

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    In the last 10 years bookings online have increased drastically. Guests are no longer picking up the phone and making reservations. Guests are booking through OTAs such as Expedia, booking.com, Hotels.com and more. Millennial's especially don't want to pick up the phone and waste their rime talking with someone when they can book easily on their mobile phone in mere seconds. Most hotels would prefer direct bookings to their site. They make more money this way, but with the increase of OTA bookings hotels are having to turn to social media to push their own sites. They are also using things like loyalty programs to drive direct bookings as well.
irinadolgopolova

Where do OTAs Stand in the Covid-19 Era? - 0 views

  • airlines have decreased capacities, withdrawn from routes, issued free cancellations and refunds to travelers, enacted flexible amendment policies to accommodate itinerary changes. However, these initiatives have also had negative impact on airlines’ operations and the balance sheets.
  • Historically, OTAs would offer alternate destinations or flight options to its travelers in times of crisis – hoping to still put a sale on its books. This time around, it is different. With several travel advisories, quarantine measures, and lockdowns in effect, people are least likely to spend their disposable incomes on travel just as yet.
  • Trip.com also guided towards a 45-50% year-over-year decrease in company-wide net revenues for the first quarter of 2020.
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  • The sudden spike in cancellations and limited interest in future travels is surely putting OTAs through an uncomfortable patch.
  • Considering the weak booking period that is to follow, the group has decided to reduce its cost base, curtailing projects, reduce marketing, overheads and discretionary spend, freeze new hiring, deferring salary increases and waiving off management bonuses.
  • The goodwill earned based on their actions during the ongoing crisis will likely pay off when the world bounces back and returns to traveling.
  • In-Airport Initiatives: OTAs such as Indonesia’s Traveloka handed over face masks to travelers visiting the affected countries (until border lockdowns were announced). Several also shared best airport and in-flight hygiene practices with their customer base.
  • Operating calls come with attached overheads, and despite the scale of cancelations most OTAs are absorbing this as part of their customer service initiatives. OTAs, however (and obviously) are prioritizing their assistance based on travel dates.
  • a number of OTAs have rolled out self-service tools, including chatbots, to mitigate the pressure from call center operations and offer instant resolution to travelers’ needs. These (semi-) automated modules are found across OTA websites and apps, which allows travelers to either opt for OTA credit for future bookings or instant refunds (subject to the airline policy).
  • With all the components now hurting, OTAs also have the unique position to revive growth in the industry.
  • Trip.com recently launched Travel Revival V Plan in China, the ground zero for Covid-19. Through the initiative, the OTA group aims to bring together hotels, tours, flights and attractions; and contribute over RMB 1 billion to boost measures for travel industry recovery.
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    As the entire travel industry, OTAs suffere a lot because of the COVID-19 pandemic. In this article are described not only financial losses of the OTAs, but also the steps that they are going to take towards the safety of the travelers, and the possible future conditions for the OTAs operations.
mmorr116

Google Hotels is the Elephant in the Room, Is it Good or Evil? - 0 views

  • First there was Google search then Google maps, Google flights now Google's hotel search product is aiming to take on other hotel booking sites and disrupt the online travel agency model.  With flights and core search Google is already a travel industry leader.
  • As Google takes on the OTAs head-to-head, hotels benefit from a significant new distribution channel which (alongside Airbnb) is a major shift in industry dynamics.
  • Rather than hotels distributing to OTAs, who charge commissions for capturing demand from Google (almost like advertising arbitrage), hotels can advertise directly on Google. This shortens the value chain and somewhat balances the  distribution power dynamic in hotels’ favor.
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  • There’s growing mainstream awareness around the potentially monopolistic characteristics of Google's position as the place where the majority of the world start their online searches.
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    OTAs identified an unmet customer need and created digital destinations that became the first stop for prospective travelers. Unfortunately, the very thing that made OTAs the original travel disruptors- the ability to aggregate digitized data to create economical, do-it-yourself travel planning - could be what gives rise to another innovative disrupter: Google.
artandmer

Working with OTAs: The Indirect Distribution Dilemma - 0 views

  • properties that work with Online Travel Agents (OTAs) perform significantly better financially than those that do not, with commissions being more than compensated for by the increased revenues, resulting in higher bottom-line profits
  • However, in reality, many hotels still have a (perhaps historic) negative opinion of OTAs
  • the commission levels reaching 25%, sometimes even 30%, that was steep. The current situation is more within the 15-20% range
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  • The real question is: How much dependency on the OTAs is healthy for your property: 20%? 30%? 50% or more of of booked room nights?
  • OTAs are a necessary evil, and they bring value most of all whenever they bring incremental revenue to hoteliers. The challenge is to strike the right balance in the distribution mix.
  • play the role as a true partner — must offer independents and chain hotels alike greater flexibility around closing out dates, close to arrival/departure, MLOS, and related tools in their inventory management toolkit
  • Few property owners or managers would object to paying higher margins on inventory that they can't sell on their own; but having to eat that cost on last room available, or even close to last room, during high demand periods is too high a price to pay
  • hoteliers tend to think these bookings are "free." Well, bad news is that they're not: booking engine commissions, advertising on search/metasearch engines, website creation, promo-codes, hosting, SEO, etc.
  • would you have gotten that booking without the OTA?
  • I believe a healthy distribution ratio is the one of 2.5:1 direct online vs OTA booked room nights, enjoyed by the major hotel chains. Marriott and Hilton are doing even better with 3:1 ratio.
  • So what is a smart distribution channel strategy? Blended distribution strategy is the smart thing to do in hospitality
  • OTAs are storms of computer engineers with a pack of money. Would you bet them at their own game? Not sure. Can you "use them" for your own needs only when necessary under particular conditions? I'm sure you can! 
  • OTAs can help hotels gain market insights and business intelligence by applying machine learning algorithms to analyze property-level data. Some OTAs might have already provided some of those value-added reports to their hotel partners. If that is the case, I encourage the OTAs to engage the hotel sales team and see what additional value/reports they can add to the partnership.
  • In fact, we would advise hoteliers to take advantage of OTAs' online reach by listing on their platforms while, concurrently, strongly reinforcing their direct channels by adopting new technology solutions. 
  • The 2021 travel landscape has dictated that the leisure guest is all-important and that guest loyalty should be the prize, not channel loyalty.
  • To put it simply, OTAs are perfect for a first-time visitor to your hotel destination.  If a returning guest books via the OTA for their 2nd visit, then this is a complete failure on the hotel for missing the opportunity to create value or establishing a compelling reason for the guest to book directly.
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    The relationship with OTAs should be about finding the right balance (or mix of business) for your specific hotel. A commonly held point of view is that OTA commissions are exorbitant (in dollars, or as a % of revenue), but shouldn't we be glad if they sold a room we were not going to sell otherwise?
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