Hotel Industry Blog

Hotels might be surprised to find who their real competitors are online.

By Des O'Mahony | On Tue, June 17, 2008

Christina Roche in Bookassist’s Dublin office points out some not so obvious truths about competition online

Your hotel website is your cheapest form of distribution, sales and advertising all rolled into one. So it is vital for hoteliers to invest time, money and effort into constantly upgrading and managing it. Of course this is a lot of work, and hoteliers already have enough to do offline, so partnering with online technology and marketing providers can be an ideal solution.

At Bookassist, a key component of our strategy for hotels is to provide strong and continual account management involving constant monitoring of the hotels’ websites, rates and availability, combined with surveying the broader marketplace. In Ireland, the majority of hotel websites with booking engines use Bookassist technology, therefore we have valuable and real statistics on the Irish marketplace that we can provide to all our clients to optimise their business.

However, providing this intelligence is of little benefit if the hotelier does not actually use their Bookassist Admin reports or work closely with their account manager. This is why good account management of a hotel’s online presence must be a partnership – the hotel must be prepared to action the advice of their online partner. All hoteliers are keen on the idea of making more money through their own website, and decreasing commission costs. However achieving that goal must go hand in hand with decreasing the number of third party websites you work with.

Third party dependence

Hoteliers are understandably reluctant to reduce third party partnerships, which have been an excellent source of revenue in the past. But that’s exactly it, they’ve been great in the past! In 2004, 20% of all hotel bookings were online compared to 2% in 2000, and by the end of 2009 50% of all hotel bookings will be online (Phocuswright). Third party sites capitalised on this consumer interest long before hotels, and did so at a cost to the hotels of anywhere between 10 – 30% of each booking. But with hotels increasingly moving online and making their own presence felt in Google search results, the necessity for third party sites is waning and the opportunity for the individual hotel to sell directly is growing. It is now time to invest in your own site and cut the apron strings from the excess third party sites, sticking with your top producers only.

Your Website’s online struggle

In the current online marketplace you as the hotelier must understand that your own website is in an online struggle with not only your competitors but also third party websites. People who search for your hotel name are seeing results from a myriad of different suppliers – third party sites and competitors – not just your website. It is therefore imperative to give your website a chance of competing against the larger websites bidding on or using your trademarks. “Monitor who is bidding on or using your trademarks in pay-per-click (PPC) advertising. Competitors and third party intermediaries could be bidding on your hotel name and stealing part of your market share” (from Ten standards for promoting your hotel online). So although the hotel employs the third party sites for added exposure, your hotel website is actually in competition with them and can be undercut by them at a commission cost to you.

It is time for your website to perform alone. You need to generate traffic and you need to convert it to bookings.

Proactive packaging

Your online strategy should be a key focus of your business, and your own website should be the focus of your online strategy. But directing traffic to your site may not result in increased bookings if the site isn’t up to standard. Ask yourself, “Have I had essentially the same website for a few years?” If the answer is yes then it is definitely time to change your approach. Look at the options open to you for building a new website complete with Web 2.0 features that customers increasingly want, like Google maps, Blogs, Vlogs, Customer Generated Reviews etc.

Work to ensure that you get the most from your website and in particular from your engine. With proper market intelligence you can devise appropriate dynamic packages for your website to suit your target market. With booking engine technology, you only get out of it what you put in. If you stick with basic packages, with very little variety and your rates are static all year round then your revenue will likely remain static or may even drop. Not every property has a spa or golf course and some don’t have restaurants, so in that case it is imperative to get creative and devise dynamic, interesting packages that are going to tempt online lookers to book your property. Knock on the doors of local restaurants, buy tickets to local tours and concerts, the costs will be absorbed in the packages and you will be adding to the value of the booking and the guest’s experience.

The online business is there for the taking. Either you take it, or someone else will.

Christina Roche, BookassistChristina Roche is Business Development Advisor at Bookassist’s Dublin Office.

Labels: tips, brand

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