Hotels stuck in a market where online travel agency rate issues still burn

Hotels are concerned at the continued hold that online travel agencies have over their ability to control rates to consumers.

In a series of questions posed to participants on a recent webinar hosted by PhocusWire with wholesaler Hotelbeds, hotels indicated a range of issues that still exist around rate parity.

Seven out of 10 respondents on the webinar, which was attended by over 600 hotel industry professionals, claim that they feel "powerless to stop large OTAs discounting their prices."

The situation that many find themselves in is illustrated in stark terms, with half saying that they are still reliant on bookings from OTAs.

Those needing to work within the OTA-hotel landscape say that they continue to work with OTAs despite finding that their "prices are not respected."

Furthermore, only one in four hotels will take any form of action against the seller they discover an issue around rate parity.

Participants confirmed as a "top priority" the challenge of ensuring that opaque rates intended for channels such as tour operators or travel agents as part of packages are not unbundled and sold individually, with 85% scoring the issue as an eight, nine or 10 (on a scale of 1-10) and only less than 4% rating the topic as a five or below.

Paul Anthony, global sourcing relations and commercial excellence director at Hotelbeds, says: "As we already knew, based on our private conversations with hoteliers across the industry, this surveys confirms just how widespread concern is in the accommodation sector. Hoteliers are asking themselves ‘how can I stop rogue players selling online rates we´d intended for other channels?’."

One of the biggest challenges for hoteliers is being able to actually identify the sales that misuse their policies, Anthony argues.

Hotelbeds says it is "investing heavily" in technologies to help with addressing the problem and has established a team dedicated to monitoring the market.

It has also recently introduced at strict "three-strikes" policy for offenders, resulting in reported issuing falling down to 0.01% of room night production.

Anthony says: "We have forfeited around €300 million of otherwise profitable sales to ensure compliance over the last year – but we’re determined to go further still."