[A]m I the only one that doesn’t really get the trend lately for mobile site booking bonuses? I understand the concept of wanting to familiarize people with their mobile site, but at the same time I can’t help but feel like no one wins if we just have to go through the hassle of making a normal booking by smart phone when we’re sitting in front of a computer.
Hotel chains offer incentives– at various times carrots but also sticks — to get you to book directly with them rather than through travel agency sites.
They’ve in the past offered online booking bonuses. Some chains won’t honor elite benefit benefits at all if you book through a third party website. And most chains won’t offer credit towards elite status for those bookings at all.
That’s because third party bookings are expensive for hotel chains, running from 15% to in the high 20’s for major chains and even 40% for independent hotels.
So there’s a real cost savings if they can get you to book through their own channels.
But mobile and web are both cost-saving and for the most part in equal proportions, so why does Starwood want to bonus mobile?
Because there’s a good chance the future of travel bookings may be in mobile. Hotels and rental cars especially are increasingly being booked last minute. Mobile penetration is huge across most worldwide markets. On the order of one in seven travelers are already booking at least some of their trips through mobile. But it remains a relatively young though growing space, where it’s still possible to gain an advantage. First to market/early adopters may have a substantial advantage.
Starwood is doing what they can to get people to download the app and familiarize themselves with it.
The bonus gets the app on your phone so that when you do move to mobile for your bookings (not everyone but many will) they’ll be well-positioned to get the booking — both for their chain vs. a competitor, and through their site vs. an OTA with higher commissions.
That’s the bet, anyway. So offering a modest incremental marketing spend that isn’t tied directly to downloading the app but is much more targeted — at actual paying guests of their chain — is almost certainly a good investment on a risk-adjusted net present value basis.