21 Dec 2016

Pivotal moment in 2016 – when Hilton called time on clicking around

Hilton Worldwide was not the first to launch a direct booking campaign, but the hotel giant’s largest ever campaign made a lot of people stop and think.

The ‘Stop Clicking Around’ initiative, aimed at loyalty scheme members, offers discounted rates and other benefits for booking through the company’s direct channels.

Marriott had made a similar move six months previously with its #ItPaysToBookDirect campaign, which had the traditional bricks and mortar agency sector up in arms.

But, it was the Hilton campaign which drew greater reaction from the online travel agency giants with Booking.com former chief executive Darren Huston expressed annoyance during a PCW event in March saying:

“We see them as business partners, and we’ve brought them lots of business they wouldn’t have had.”

Then, in July, Expedia boss Dara Khosrowshahi claimed the while the hotel direct booking campaigns were not affecting it but added:

“As far as competitive brand marketing activity, the big chains’ campaigns are probably not good for us….We want to have a promising dialogue with them…”

And, it’s in that “promising dialogue” where things seem to have moved recently with conciliatory talk from both sides, about partnerships, surfacing in recent months.

A few concrete examples include the deal for Expedia to help Marriott package up and sell its vacations product on the hotel brands website.

Or, the partneship between Red Lion and Expedia which displays the hotel chains loyalty rates next to standard rates on the OTA’s website.

Anecdotally, there are also more examples of hotel execs saying they are also thinking of the OTAs in terms of strategic partners.

Whether any of this represents a real change in the mood remains to be seen but some comments made by Expedia at a recent press briefing.

Cyril Ranque, the group’s president of lodging partner services, said there is the “PR view” in terms of what hotel companies say to the outside world and then, what is really happening.

He concluded that “common sense would prevail” eventually with hotels seeing that giving prefential rates to customers who are already loyal and booking direct might not be the best idea ever.

Perhaps, (PERHAPS) there’s even recognition that the current hotel-OTA commissions, said to be as high as 30% in some instances, cannot continue so OTAs must demonstrate further value through other services.

Related reading:

IHG turns the screw on agencies with direct booking swipe