Previously I had speculated that Google’s expansion into hotel distribution could present hoteliers with a much needed boost in bargaining power when dealing with Online Travel Agencies and instant booking metasearches.
As Google quietly rolls out its instant booking option we begin to get a sense of the impact this addition to the hotel distribution landscape could have on the industry as a whole.
Speaking in simple economic terms, greater competition generates better quality and lower prices. Translated into the current context, where two giants in the OTA business (Expedia and Priceline/Booking.com) join TripAdvisor Instant Booking as the only real major players, megalith Google may provide a much needed counter-weight to an unhealthily balanced scale.
Is any of this happening?
Already we see the benefits of an additional distributor. Using the TripAdvisor model of drawing data from the hotel’s own website, Google makes no attempt to “own the customer” and does not stand in the way of pre and post-stay guest communication. This has been a major talking-point between hoteliers and OTAs in the past with little or no guest data being transferred to hotels on OTA bookings. The resulting gulf could be felt on both sides: guests received little or faulty information regarding their hotel thereby reducing customer satisfaction; hotels had no way to contact the guests post-stay thus reducing their ability to connect with guests and create loyalty to the brand. For hoteliers Google now provides an attractive alternative.
What makes “Book on Google” unique?
Google stays Google. While drawing rates and availability from the hotel’s own website, the guest is not first directed to a potentially unfamiliar hotel booking engine to finalize. The expectation is that conversion rates will increase if guests can complete the reservation process using steps and visuals that have become familiar to them through previous interactions with the trusted search giant.
But what about payment?
Also a Google upside. Instead of being sent to an OTA or the hotel to complete payment – a deal-breaker for many – payment can be made through the Google interface. This could also benefit less automated small or mid-size hotels that do not have a payment provider in place.
What else does Book on Google have to offer?
Unique to Google’s online booking option is their amenities window, which gives immediate details on upsell items for each hotel, allowing potential guests to compare hotels at a glance. The benefit to guests is clear – the more obvious the list of amenities the greater the competition will become to provide more/better. For hotels that already provide a great guest experience, this is a simple way to broadcast their message.
Mobile Guest Journey – of ever greater importance
In this age of constant movement, a mobile friendly booking option is essential. But how many apps does the frequent traveler have to download to stay mobile? The expectation is “fewer” now that Google has joined the conversation. Not all hotels can afford a mobile-friendly booking engine which often leaves Expedia or Priceline/Booking.com as the only alternatives. Happily this is no longer the case. Google has vast experience with the mobile world and provides a universality that is attractive for many.
Where can hotels still demand more?
Commissions. The tariff is disquietingly unified among distribution sites. 15% of booking seems to be the magic number and many hotels find it unjustified. But perhaps we should take a closer look. With Google and TripAdvisor it could be contended that high commissions are well-spent on the marketing they provide. As long as hotels control the guest relationship, this fee can be avoided for subsequent reservations. Can the same be said for OTAs? Arguably not, as there is no variation in commission whether the guest is visiting the hotel for the first time or deserves a medal for loyalty. If OTAs demand to “own the customer”, the legitimacy of such high commissions must be called into question.
Inventory is a hotel’s strongest weapon
It is clear that, for many hotels, this new distribution alternative could provide not only a boost in booking numbers but also a way back to the bargaining table with traditional OTAs. Inventory is in the purview of the hotel and its strongest weapon. What is to prevent hotels from using it?
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Kim Rebernig has been working for hetras as Customer Success Manager since 2013 and has more than 20 years of international hospitality experience to back up her enthusiasm for technical innovation. As a Canadian living in Austria she is