Four Trends to Watch for in 2015

There is no hospitality like understanding. As an hotelier, I can vouch for it. As an hotelier, you need to understand your guest, their buying pattern, seasonal behaviour, market rate fluctuation, global economy and what not. And as if tracking you competitors is not enough, you have to now keep of new players in the distribution arena. Today’s revenue manager’s job is always on a roller coaster.

2014 was the year when meta-search channels further consolidated their position, with TripAdvisor throwing in a surprise in the form of commission based model, and bed banks like AirBnB becoming a really hot topic. The year ended with the curtain-raiser for Amazon’s entry as hotel retailer. If you think 2015 will be any different, you are in for a surprise.
Here are four trends I will be watching for in 2015.
Rise, rise and rise of Big Data

We have been hearing it for the past few years, now. But 2015 is going to be the year when Bid Data is going to take center-stage in marketing and distribution strategies of most hospitality companies. It is the buzz word I hear at every travel industry conference, at every trade show, as if it has the Midas Touch to solve every problem we face today.
And indeed it almost has. Big data by definition usually includes data sets with sizes beyond the ability of commonly used software tools to capture, curate, manage, and process the data within a tolerable elapsed time. As revenue managers, you and I are used to accessing multiple reports from CRM, PMS, CRS, etc. Data overload has been long been a cause of worry for us. What big data does is that it gives us the capability to store data, dissect and dice it, analyze and draw insights from it…and then use those insights to greater understanding of customers and markets which eventually yields innovative products and more valuable customers.

Analytics for positive business outcome

Ok, I admit, Big Data and Analytics are closely related. Analytics is the application of science to Analysis, or as some experts call it, it’s basically data science. We all have data, but it becomes valuable only after you analyze it to derive insights. To give you an example, while benchmarking reports might help you to know your pricing position, it would not be giving you a clear picture on what should be your best position in a channel– which might not be the first or last position, but somewhere in between which gives you the maximum yield. With Analytics, you will be able to identify your best position, which would get you the optimal return.

Hotels for a long time relied on transactional data for customer insights. With the advent of internet, incoming traffic has been important source for customer segmentation.  However, with cross-platform connectivity becoming the new normal, hotels are increasingly finding it difficult to cope up with so many things are happening across so many platforms – how do we stay in sync? Analytics gives them the insights through which travel companies are able to “listen in” on potential consumers’ opinions, needs and desires, and deliver results accordingly.

In next edition I’ll talk about how mobile is outpacing desktop and becoming a hot trend.

By Dhiraj Kumar is Associate Product Owner at eRevMax. He is based out of Kolkata and can be reached at dhirajk@erevmax.com

Is TripAdvisor turning into an OTA with its Instant Booking Model?

TripAdvisor has recently unveiled their direct booking feature, which offers users the option to book hotels within its site. Officially called TripConnect Instant Booking, this function has already created a lot of buzz in the industry.
I attended a session at WTM, where TripAdvsior gave a rough sketch on how the model works.  This will allow users to research, compare, choose and now book hotels, in other words, complete the buying journey while staying within TripAdvisor user experience.
This is a major shift in TripAdvisor’s revenue model, which earlier relied on advertising. Only last year, the travel giant had revealed its meta-search service, where a supplier  uses TripConnect CPC (cost-per-click) to place bids to appear in the price and availability search results. With the new model, TripAdvisor has introduced a commission based ‘bidding model’, where suppliers like OTAs, hotels, GDSs bid on a commission percentage they are willing to pay.
The basic difference between the CPC and Instant Booking model is that for the former, partners bid via cost-per-click for the top positions, and pay when users click on that link, whereas in the new model, they pay TripAdvisor a commission once the user completes their stay.  In the earlier model, suppliers required bid management strategy to be on top position, and directing traffic would not necessarily lead to conversion. The Instant Booking gives them 100% return on investment; in addition they will own the data, can view traveller profile and be the pointof sale collecting the payments.
If it reminds you of the traditional OTA model, you are absolutely right. But does that mean TripAdvisor is aspiring to be an OTA? According to analysts, this is an extremely smart move by TripAdvisor to improve monetization of its mobile channel.  The site gets around 110 million monthly unique visitors, about 40% of its total traffic, but accounts for less than 20% of desktop when it comes to monetization.
With mobile booking rapidly growing in US, Europe and APAC, Instant Booking, which allows users to book a hotel room while staying on the TripAdvisor user-shell will encourage more people to book, and therefore improve conversion rates. To make it more attractive for partners, TripAdvisor is using the Top Position of it search result and extending Premium Certification to enjoy benefits like tradeshow and online promotion to those signing up for this programme.
For independent hotels struggling to improve position in a channel where big OTAs with larger marketing spends typically dominate, this can be a golden opportunity to get direct bookings at a lower cost per acquisition, and to increase distribution on distressed inventory or increase direct bookings in low periods through improved mobile booking experience.
Choice Hotels International, Best Western, GetaRoom.com, Amoma, Tingo and GDS operator Travelport have already signed up for this programme.  In fact for TripAdvisor, Travelport’s listings for 580,000 hotels worldwide, including 480,000 non-branded properties and 150,000 e-commerce enabled listed properties can be the biggest coup for this program.

Presently pilot testing on global Mobile and certain US desktop IP addresses, the program is expected to be globally rolled out early 2015. With Google Hotel Finder also testing Buy Now in the UK market, does this indicate a new trend to look out for in 2015? It certainly looks so!

Amazon’s entry to online travel – is that disruption?

As if the entries of Google and TripAdvisor were not enough disruption, we now have Amazon which is entering into hotel distribution. So while buying your books and what nots, you can now go and buy a hotel room from the retail GIANT!
Amazon Local currency has already been selling some limited and wholesaler type hotel programs for a while now. But that was more of a distressed sale kind of an approach they were taking. With the new model, Amazon is asking hotels to publish their rates and availability for a longer period. For hotels, this means hotels can push full price inventories in the peak season, and of course offer discounts when they are desperate.
Does that mean Amazon is now seriously entering into travel services a la Google?  Travel analysts apparently think so.  Expedia CEO has already ‘welcomed Amazon into the party’.
Truth is, as Expedia Inc. CEO Dara Khosrowshahi says, travel today is a trillion dollar global industry. And everyone wants to take a share of the pie. That is why we are seeing TripAdvisor making serious entry to commission based model through TripConnect Instant booking. Wait for Google to make the next move.
Are these changes going to make it more complicated for hoteliers? In my opinion, Amazon, with its marketing capabilities, can become a serious alternative for independent and small hotels. What about TripConnect and Google Direct booking, when they are launched globally?

But as always, your success depends on how well you manage your booking channels. 

eRevMax predicts hotel online distribution trends 2014

As technology advances and the world of social media expands, more and more travelers are turning towards smart phones and tablets to book hotel rooms. eRevMax, the leader in hotel online distribution and channel management solution has released an Infographic “Online Hotel Distribution” to provide hoteliers with upcoming trends backed by relevant data.


Travelers who book hotel rooms online are increasingly equipped with smart phones and tablets. The infographic shows 7% of all bookings were generated from mobile and tablet devices in 2013, and this trend will grow by another 20% this year. In 2014, hotel bookings through mobile will contribute over $26 billion.


The eRevMax study sheds light on how metasearch sites realized a 13% increase in 2013. Google Hotel Finder, TripConnect and Trivago are becoming a driving force in hotel online distribution as 60% of travellers shop by comparing rates on these sites. To shift market share from the OTAs to direct bookings, hoteliers should utilize metasearch sites as a part of their overall distrbution strategy as it offers better search experience and allows the traveller to find the lowest prices available online.

Bookings from OTAs surged ahead with a 12% rise in Q3 2013 and now stands at 13% of overall bookings in North America. It also shows that 33% of all bookings take place at the brand’s website, an increase of 5% in Q3 2013. eRevMax suggests hoteliers work with OTAs to increase revenues and implement reputation management solutions for quick responses to their guests.

Another important tip by the hotel solutions provider is to leverage the billboard effect, defined as the increase in offline bookings of a property when it is listed with an Online Travel Agency (OTA). An experiment conducted by Cornell University observed that one of the participant hotels experienced an impressive 14% increase in direct bookings when it contracted with an OTA. Besides, Average Daily Rate (ADR) increased by 1.5% during OTA listing of the same property. 

In this world of social media, SEO and analytics, failure to adopt digital platforms in their marketing strategy is suicidal for hotels. The data shows that 81% of tech-savvy travellers find user reviews important, while 49% travellers book hotel only after reading reviews. Nearly 21% used Facebook to search for hotel information at least once while 14% of travellers use the Facebook platform to book a hotel room. Hence, it is imperative that hotels take social-commerce seriously. 

To access the full infographic, click Infographic: Online Hotel Distribution 2014