MSNBC carries a piece on hotel chain efforts to move bookings to their own websites and away from the likes of Orbitz and Expedia.
The piece cites the trend to refuse to honor elite benefits on third party bookings and to offer ‘best rate guarantees’ for bookings made on their proprietary sites. It doesn’t evaluate those guarantees for fine print and ease of processing claims, however.
The stakes are huge:
- PricewaterhouseCoopers estimated that the Web last year generated an extra $715 million in hotel business. But increased price competition spurred by the Web cost hoteliers $2 billion in potential revenue, meaning the Web on the whole cost hoteliers about $1.3 billion in revenue.
And the shortfall for hoteliers is growing, said PWC analyst Bjorn Hanson. “There is no question that we are losing the battle,” Starwood Hotels and Resorts Worldwide President and Chief Operating Officer Robert Cotter said, pointing to deals that gave the Web merchants 18 percent to 30 percent of revenue for a room sold mid-week.
He predicted that 75 percent of hotel travel would be on line within 3 to 5 years and that the changes in loyalty programs and better company-owned sites could retain customers. Only about 10 percent of hotels were booked online last year, according to PWC.