RatesToGo will begin to take merchant-model hotel bookings as one of several steps parent company Orbitz Worldwide is taking to improve its hotel business in Asia-Pacific.
Until now, RatesToGo, founded in 2002 and operated by Australia-based HotelClub, only used the agency or retail model with hoteliers.
Orbitz Worldwide CEO Barney Harford, speaking during the company's first quarter earnings call today, said relying on the agency model has hampered the RatesToGo business and supplementing it with the merchant model would be advantageous.
Harford says HotelClub and sister brand RatesToGo see a significant hotel opportunity in Asia-Pacific. In that region, they lag inroads being made by Priceline's Booking.com and Agoda, in particular.
HotelClub and RateToGo have faced challenges in Europe, Harford said, but only a relatively small piece of their businesses is in Europe. He added that around 65% of their business is based in Asia-Pacific.
Harford says Orbitz is hopeful about technology investments being made in the two companies, with RatesToGo slated to migrate to a global technology platform during the second quarter and HotelClub to follow in the third quarter.
Adding the merchant model to the RatesToGo portfolio would differentiate it from Booking.com, which primarily has relied on the agency model for hotels. Agoda, however, indeed uses a merchant model.
Whether adding the merchant model to RatesToGo and putting it and HotelClub on the new platform will be sufficient to jump-start the Orbitz hotel business in the region remains to be seen.