More change in our distribution landscape and it's happening right now…

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More change in our distribution landscape and it’s happening right now…

Just when we thought we had enough on our plate managing Booking.com & Expedia, there is more change afoot!

There have been two huge announcements this week that are absolutely about to shake up how we manage distribution in the coming months and potentially years.

The first is that our wonderful friend ‘Google’, (yes, note the sarcasm in my voice), has launched a new booking engine and upgraded their meta-search engine.

We are of course already bidding and spending a huge budget in an attempt to reach those golden top spots in Google Ad’s, but now it seems that taking our PPC budget (estimated at a $9 billon spend by hotels in the US each year alone) isn’t enough and they also want another piece of the pie, in the shape of commission. And to do that, Google has drastically improved their booking engine and meta offering.

This improved search and book tool will allow customers the opportunity to browse hotels within their chosen price point and drill down to select amenities and facilities. All there, right within a search engine and all within one click.

But the biggest advantage Google offer is that they will highlight any hotels that are offering significant discounts on either a rate they normally sell at OR compared to one of their competitor hotels.

Add this to the fact that all of this is displayed within a Google map; and that they are the search engine of choice for 99% of the population, and voila! you have the perfect storm of distribution shift.

The second big piece of news is that Airbnb have acquired HotelTonight. We have noticed for some time that Airbnb have been creeping into the hotel space but this really cements their place, not as an ‘alternative’ accommodation provider but sees them acting firmly as an OTA.

Like all good agile businesses, Airbnb are constantly adapting and pivoting their offering and have also recently launched Airbnb Plus and Beyond Airbnb, both of which offer a higher-end experience than what the Airbnb brand originally personified.

But what does this latest acquisition mean for us as hoteliers? Well, in my opinion, it means that our distribution space is changing – again. We have more ‘blended’ channels which means more ‘blended’ rates. Self-catering providers are moving into the hotel space and OTA’s such as Booking.com are now itching and scratching at the self-catering space.

I have said many times that you need to ‘be where your customers are’ and for you, if this means entering the Airbnb space then perhaps that is worth considering? But remember that to even start playing with Airbnb, you need to offer something different. Brands are shunned, along with hotels that offer the ‘cookie-cutter’ experience. So if you want to be in that space and align with their brand, then ask yourself what you can offer either within your product or as a guest experience. What will make you stand out from the crowd?

As for Google, well let’s face it, they have more cash, technology, people and ‘smarts’ than most of the OTA’s put together, so my thoughts are that these guys are the ones to watch. Ever pushing into the hotel distribution space, I have no doubt that our cost of customer acquisition is set to rise.

Ask yourself, what you are doing to win even the smallest market share from these channels? Baby-steps and crawling back direct bookings – no matter what the pace, can make a huge difference to your bottom line.

In a quote taken from my new favourite business book ‘Be More Pirate’: “Change and challenge are constants and the way we organise ourselves to meet them is going to be crucial as we navigate. The skills we need to do so are going to look increasingly different too”

So, my question is – are you ready to Be More Pirate?

ABOUT THE AUTHOR: Adrienne Hanna

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