In what could be a significant strategic development, Booking.com is now getting inventory and exclusive prices for hotels from other online travel agencies.
Whilst it is not clear as yet if this is a fully fledged "marketplace"-type effort, the Booking Holdings-operated accommodation giant is featuring heavily discounted rates on some properties as part of a new service known as Booking.Basic.
The prices are included alongside existing rates from its own contracted inventory but come via third parties.
These rates have heavy restrictions on them, such as no special requests to the property, delayed confirmation, nonrefundable and no modifications to the reservation.
An official at Booking Holdings says Booking.Basic is currently a "test."
There are no details as to the process behind sourcing the rates, but PhocusWire has found inventory from stablemate Agoda and Ctrip, the mega-OTA in China with which Booking Holdings has a strategic agreement (and has invested heavily in) to share inventory.
Booking.Basic does not appear to be exclusively for hotel rates, with our tests showing the feature available on some private accommodation properties.
Process and questions
The program is being conducted under typical A/B-type conditions - properties are showing Booking.Basic rates for some user locations but not others.
The majority of special rates found are in the Asia Pacific region.
The official says: "In true Booking testing fashion, we are testing inclusion of low, nonrefundable rates that we have independently sourced from third-party providers for certain properties on Booking.com."
Cesar Lopez at Spanish hotel consultancy Mirai, which has analyzed what it could mean if the test becomes a permanent feature, argues that the model could be to the detriment of hotels that do not have agreements in place with the original contractor to push rates again to Booking.com.
He says: "It is nothing new that inventories are redistributed and resold on different levels by successive links. Many OTAs supply themselves with third-party inventory sources.
"It is not surprising, nor should it be a shock, that Booking.com also resorts to others to improve their competitiveness where it does not have the best price."
One such question to emerge will be: How deep and wide would Booking.com extend the program to other OTAs to participate, not least to brands outside of close and peripheral family members of Booking Holdings?