Distribution

Booking.com and Expedia are growing in very different ways

Aug 27, 2019 / OTAs
Expedia
Expedia

While their business models are identical in terms of their various revenue sources, there is a notable difference: Booking.com makes most of its revenues through agency bookings, while Expedia relies heavily on merchant bookings.

Expedia Group and Booking Holdings reported total revenues of $11.2 billion and $14.5 billion in 2018, respectively. Moreover, both the company’s revenues have grown at a similar CAGR of 19% since 2016.

Agency Revenues contributed 27% and 72% of total revenues in 2018 to Expedia Group and Booking Holdings respectively. This was primarily due to significantly larger agency bookings at Booking Holdings as compared to Expedia Group.

On the other hand, Expedia Group has a higher share of merchant revenues due to its stronghold on merchant bookings. In 2018, Merchant Revenues for Expedia Group and Booking Holdings contributed 53% and 20% of total revenues, respectively.

Revenue Management

Learning from the past: Cutting rates hurts everyone

Aug 27, 2019 / Pricing
Shutterstock
Shutterstock

An analysis of how quickly hoteliers responded to other hotels dropping rates in their competitive sets during the recession shows no one comes out a winner.

To have a better idea of what a potential downturn could mean for the U.S. hotel industry, it’s worth observing how hoteliers behaved during the last one.

Carter Wilson, SVP of consulting and analytics at STR, explained during his session “Chaos or control? Pricing psychology in a downturn” at the 2019 Hotel Data Conference that the company has heard frequently from clients that there was always one hotel in each comp set that was quick to slash rates. As a result, others felt compelled to follow suit.

Wilson said his team looked for evidence of these “rogue hotels” in 2009 to find out who cut rates by 10% or more first and how long it took for others in the comp set to do the same. “Big disclaimer: There were no winners in 2009,” he said. “Every hotel lost substantial (revenue per available room); they just did it differently.”

Distribution

A blockchain to reconcile hotel commissions

Travelport
Travelport

Travelport working with IBM, BCD Travel and three hotel chains—has created a minimum viable product solution that uses blockchain to reconcile the commissions hotels pay travel management companies.

Travelport and its partners aim to give agencies and hotels an accurate, shared view of the status of their bookings and commissions. This requires a solution that communicates relevant and necessary information, reconciles records, resolves missing and disputed payments, measures performance and supports timely payments.

"Blockchain technology applied to commission reconciliation has the potential to deliver real ROI to both a travel agency and the hotel," said Travelport senior product director Ross Vinograd. "Traveler modifications at property, no-shows and complimentary room nights are just a few examples that drive commission discrepancies, which in turn generate escalations, cost and revenue loss. Our aim is to put the life cycle of a booking on the blockchain, and we believe doing so will drive transparency, trust and ultimately booking volume."

Market Data

Roundtable: Driving the future of hospitality

Aug 27, 2019 / Economy
Shutterstock
Shutterstock

Participants agreed that finding the right balance between technology, labor, and guest experience is key to hotels’ ongoing success through the end of the cycle and into the next.

Earlier this summer, high-level executives from a diverse group of companies gathered for a roundtable hosted by revenue management solutions company IDeaS. The roundtable, titled “Revenue innovation, profitability, asset value, and the future,” gave its participants an opportunity to speak frankly about issues affecting the hotel industry and new technologies that they feel will have a profound impact in the years to come.

Right away, the panelists noted that while the hotel industry continues to do well, the industry isn’t as solid as it was. Part of the decline can be attributed to a slowing of group business, but also the fact that leisure travelers aren’t booking as far in advance.

The roundtable participants agreed that finding the right balance between technology, labor, and guest experience is key to hotels’ ongoing success through the end of the cycle and into the next.

Products & Services

Marriott launches wellbeing app

Aug 27, 2019 / Marriott
Marriott International
Marriott International

TakeCare Level30 is an engaging experience designed with a partner in mind to complete a variety of wellbeing activities and earn points together.

TakeCare is activated through engaging experiences and events, group activities, self-help tips, and coaching on a variety of topics from growing a career to building a healthy mind and body, to sharing respect, kindness and passion for giving back to the community, and much more.

Marriott’s internal research shows that promoting this elevated level of employee experience and personal wellbeing is foundational to creating exceptional travel experiences for its hotel guests.