Are hotel websites kicking the butts of the online travel agencies?
Along those lines, InterContinental Hotels would like take more traffic from the OTAs and hopes to do so with the introduction of a new Best Price Guarantee and Book With Us Advantage.
Under the terms of the guarantee, guests who find a qualifying lower price elsewhere online for a room in any IHG brand will get a free first-night stay and the rest of their stay will be priced to match the lower rate they found, the hotel says.
InterContinental characterizes its revamped price guarantee as "the most powerful website guarantee..."
The InterContinental initiative occurs as hotel marketing company TravelClick release new data which indicate that hotel-direct channels have been making strides against OTA channels for much of 2011.
TravelClick's North America Distribution Review found that hotels' branded websites attracted 25.2% of bookings during the second quarter versus 11.7% for the OTAs. In fact, the OTAs were the weakest channel, according to the survey.
TravelClick's breakdown for the second quarter was:
- Voice (800#) 16.8%
- Phoning the property 26.8%
- GDS 19.5%
- OTA 11.7%
- Brand.com 25.2%
"OTAs were up during the downturn because travelers were looking for discounted rates," says Tim Hart, executive vice president of business intelligence for TravelClick. "Now that the economy is improving, traditional channel performance is improving."
TravelClick's statistics are based on reservations and committed group sales by brands participating in the company's MarketVision Demand Position solution.
Gaylord, Hilton, Hyatt, InterContinental, Loews, Marriott, Omni and Starwood are among the participating hotels. Data was collected from 25 North American markets representing $27 billion in annual room revenue.
If you believe TravelClick's numbers, then the strength of hotels' own websites versus the OTAs becomes even more pronounced by the fourth quarter or 2011 -- 34.5% versus 5.8%, respectively.
Douglas Quinby, senior director of research for PhoCusWright, concurs that hotels' branded websites have been picking up strength versus the OTAs.
And the airline sector comes into play when discussing hotel dynamics, Quinby says.
"Dynamics in the air market -- high oil prices, constrained capacity, fairly strong corporate demand and higher fares -- are depressing leisure travel demand," Quinby says.
And, that's not a good thing for the OTAs, who serve the discount-hungry traveler, he says.
"For OTAs, air is like the milk in the grocery store," Quinby says. "Please come in and shop for air and would you like a hotel with that?"
Hotels' branded websites "attract more business and loyal travelers, who have come back in greater strength than your price-sensitive leisure traveler," Quinby says.
Meanwhile, InterContinental's new best price guarantee may attract some of those price-conscious leisure travelers, as well.