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Revenue management – Making the most of metasearch

14 November 2014
Revenue management – Making the most of metasearch

With the growth of sites such as Trivago comes a new challenge for hoteliers in deciding where to advertise their rooms and rates for maximum impact. Elly Earls reports

Hotel distribution gets more complicated by the day. Just as hoteliers have got to grips with the ins and outs of working with online travel agents (OTAs) such as booking.com, Expedia and LateRooms, metasearch sites, including Google Hotel Finder, Kayak and Trivago, have started witnessing huge growth, providing hotel operators with yet another channel to understand and attempt to navigate.

In 2013, metasearch use grew by 13%, and of TripAdvisor's 200 million monthly visits, more than 50% of these already use its metasearch feature.

Add to this the fact that mobile bookings are soaring and guests are increasingly using multiple devices to complete just one reservation, and it's become more challenging than ever for hoteliers, particularly those with small operations, to decide where and how to spread their inventory for maximum impact.

OTAs: a known quantity

OTAs are by and large a known quantity for hoteliers these day. By paying hotel reservation websites such as lastminute.com, LateRooms and Expedia an often pretty substantial commission, operators, particularly of boutique and independent hotels, can hugely increase their marketing reach, attracting customers that might otherwise never have come across their properties.

"OTAs provide an incredible advertising platform for hotels and exposure to thousands of prospective guests that their marketing budget probably wouldn't (depending on the size of the hotel) be able to achieve," says Angelene Bungay, revenue and distribution manager at property management system (PMS) provider Guestline.

"Hotels can manage the percentage of inventory they send to these channels according to what their availability is at any given time."

At Rudding Park hotel in Harrogate, for example, when there is limited room availability, the hotel no longer sells through the OTAs.

"When we haven't got much left, we only accept bookings direct," explains managing director Peter Banks. He adds that it's crucial to work closely with your OTA manager to get the best out of the relationship.

"They will come in and compare your statistics with your local competition and tell you what you need to do. You've got to work closely with OTAs and control it as well as you can."

The new kid on the block

Yet just as hoteliers have become reasonably au fait with how to work with OTAs, there's a new kid on the block: metasearch sites. These conduct searches across multiple travel websites, comparing rate and availability, and are set to transform the hotel distribution landscape once again.

"The change they have driven is something I would liken to how Groupon hit the UK, creating a voucher code culture," explains Best Western GB's head of digital Dan Morley.

"Metasearch has created a highly competitive, price-sensitive customer base, where customers migrate towards the cheapest possible price, often booking with companies that have no real presence outside the meta landscape."

A change on the horizon

So how can hoteliers get the most out of metasearch sites such as Kayak, Trivago and TripConnect? For Rajesh Vohra, sales and marketing director at Sarova Hotels, it's difficult to know at this point.

"I think we're just at the beginning of what metasearch is going to do," he says. "I think it will fundamentally change the landscape and

"Moreover, there are multiple models, so there isn't really a standardised way of it working. The way we work with a particular channel has to be individualised to each metasearch company."

In the meantime, as metasearch continues to evolve, advises Morley, the best thing hoteliers can do is work with the channels that advertise on the meta sites "These are the channels that are driving the bookings and these are the channels that are paying the metasearch sites," he explains.

"If the relationship between the merchant and the OTA is not working, then the merchant will stop advertising and the hotelier is the one that will lose revenue."

Direct is best

Of course, direct bookings will always be the most profitable for hotels, so it's crucial for operators to focus just as much attention on their own website - and their customer retention strategies - as they do on navigating the increasingly complex OTA-metasearch landscape.

"Content is still king for the website - not only for search engines, which use the content to form their search criteria, but also for the general public," says Bungay.

"Moreover, making the website 'sticky' - giving the end-user a reason to return or stay on the site - will greatly increase the chances of
direct bookings, while placement of online booking method is also important. The potential customer needs to ascertain that they can book online quickly via the property's own website."

Finally, post-stay communications to reinforce direct bookings play a huge role, Bungay believes, especially when the user booked via an OTA. "Letting the customer know that booking direct could save time and potentially offer a better deal next time is an often overlooked re set to transform the hotel distribution landscape once again."The change they have driven is something I would liken to how Groupon hit the UK, creating a voucher code culture," explains Best Western GB's head of digital Dan Morley.

"Metasearch has created a highly competitive, price-sensitive customer base, where customers migrate towards the cheapest possible price, often booking with companies that have no real presence outside the meta landscape."

Mobile growth

The number of hotel guests either researching or booking their hotel stays on mobiles has increased incredibly over the past couple of years, making it crucial for operators to be present on this channel - either via a dedicated mobile site or a responsive website that can adapt to any size of screen.

At Rudding Park hotel, for example, between 2012-13 and 2013-14, there was an overall increase of 10.5% in total unique users on the hotel's website, made up of a 148% increase in mobile traffic and a 6% drop in traffic from laptops and desktops.

"Mobile is just going through the roof," Banks says. "And it's actually taken market share from wired [ie laptop and desktop traffic].We've lost 20,000 unique visitors on wired and our mobile has increased by 50,000!"

Meanwhile, at Sarova Hotels, one of the most interesting trends Vohra has noticed is that customers are using multiple devices to make just one reservation.

"They'll do research on their phone on the train on their way home, have another look on the iPad when they get home, and then in the morning they'll go to the office and make a reservation," he explains.

"That pattern happens a lot, so over the past 15 months we've invested in rebuilding our website to make it fully responsive so it works on multiple platforms."

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