While Agoda is
hailing its new feature “Mix and Save” as a breakthrough for extra
budget-conscious travelers, hoteliers are still coming to grips with what it
really means for them down the line.
travel platform says the feature would allow customers
to save up to 50% in some instances by booking the cheapest combination of
available rooms within the same hotel. “Mix and Save” gives customers the
option to split their reservation into multiple bookings and helps them to maximize
savings when they search between a two- and 14-night stay at any of its two
million properties worldwide.
Agoda says that, in
turn, accommodation providers will benefit from being able to optimize use of
chief operating officer at Agoda, says, “Our customers inspire us to innovate.
We’ve seen them ‘mix and save’ through trial and error, where they would split
their stay and stack different room deals to get the best overall price, which
can be cumbersome and time-consuming. Traditionally OTAs have made the
assumption that guests wouldn’t change rooms, but our tests have shown that,
for the right savings and low price, there are travelers who will be flexible
and change rooms during their stay to get a better deal.
“We are excited to be
the first major global online travel agent to make these ‘hacker rates’
available. Mix and Save helps partners to optimize inventory and reflects our
commitment to offering Agoda customers the best possible price.”
on desktop, Agoda is looking to enhance the offering in coming months, allowing
users to enjoy Mix and Save deals on mobile and to combine the split bookings
in a single reservation.
Pros and cons
The response from
hotels and distribution providers was mixed, with one expressing outrage at
what it could do to revenue management in a hotel and another saying this could
be a risky strategy for Agoda, while one hotelier called it clever.
Tan, managing director at D-EDGE Hospitality
Solutions APAC, “Interesting. It is a question of mixing the room rates for
different dates, where usually the price for a length of stay is defined per
room. It might become very difficult for hotels operationally – changing rooms
during the stay. It also forces hotels to manage better their pricing
“I am not sure how it
will impact the hotels. If they are not happy by that, they may remove their
availability from Agoda and put it elsewhere. It’s risky for Agoda.”
Fabian Bartnick, CEO
of Infinito, says, “Reservations for four nights will now come in
four different reservations across room types, rate plans, pricing policies.
Now imagine apartments who have to pay a cleaning fee for every check in, check
out? Not the four nights’ stay that had one check-in and one check-out fee, it
now has now 4x check-in and 4x check-out fee. This is going to go crazy
especially in Australia.”
cluster revenue manager at Veriu Hotels & Suites and Punthill Apartment
Hotels in Australia, speaking at No Vacancy this week, was less fazed by it. She
commented on a panel that she is focusing on increasing length of stay of
customers (to avoid additional operational costs of having more short-term
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She says, “It will
affect us operationally (if guests are changing rooms within one stay), but to
me, I may not even be aware it is the same customer anyway. If I do know of it,
if it is a direct booking, I might try and put them in the same room. We train
our staff to ensure we have availability for a guest in the same room type
throughout the length of stay.
“It is a clever
initiative by OTAs. Why not?”
Philip Niemann, group
vice president, Asia Pacific, at Duetto, says, “Hoteliers must pay close attention
and ensure such heavy discounting is the right strategy for them. While it may
drive occupancy, it may actually harm profitability. Ensure you’re making
informed decisions based on your own guest and transaction data and understand
how low-rated business will affect your performance.”
The idea of mixing
rates is not new, according to industry insiders WiT spoke to. One hotelier says “it
looks like some other programs available on other OTAs,” just that on these
sites, the feature is not active, they say.
pointed out that an Israeli-based OTA, Splitty Travel, founded in 2015, claims
its unique selling proposition as “splitting and combining multiple
bookings under one reservation.”
In April this
year, Splitty raised $6.75 million in a Series A round of funding
led by Fosun RZ Capital, the VC investment arm of Fosun International.
2bAngels, Techstars Ventures, Cockpit Innovation and 11-11 ventures also
The question in
hoteliers’ minds is how the Agoda move will affect operations – “this could
be an operational nightmare with room move, request to stay in room,
additional turn around cost for hotels, passport check and registration to
authorities, confusion for arrivals, bookings not being linked – therefore
What is also new of
course is that it is a company of Agoda’s scale that is doing it and what this
could mean long-term for hoteliers.
has said that the new funding will enable it to expand its team and
accelerate its global market growth in the coming years, with China as one of
the markets. Splitty claims to analyze and split over 1.5 million
transactions to create exclusive deals in one second.
differentiates itself from traditional OTA through this transaction model,” says
CEO Eran Shust.
“It’s a win-win situation –
we could improve the occupancy rate of hotels by over 15%, while
users enjoy lower prices up to 50%. Fosun RZ Capital is the perfect
partner for us to bolster our business globally."
Duetto’s Niemann, “Overall, while commission costs are coming down thanks
to some hard bargaining by the biggest global hotel brands, the share of
travelers booking through an OTA continues to grow. Acquisition costs continue
to cut into hoteliers’ profitability, along with rising franchise fees,
marketing and digital marketing costs.
"With all of the data available to them
today, hoteliers should be able to build a more seamless and personalized
booking experience that drives more profitable bookings to their lowest-cost
* This article originally published on WebInTravel.