Impact of Direct Booking Campaigns on Hotel Chains Revenue

Direct Bookings

Impact of Direct Booking Campaigns on Hotel Chains Revenue

Most of hotel owners want to know what impact direct booking campaigns have over the revenue of hotels. This has become the question for many analysts of the hotel industry. The report shows that the giant hotel chains like Hilton and Marriott have been spending more on direct booking campaigns. This effort takes away from the online travel agencies like Expedia, their market share. By looking into the collective statements of the giant hotel chains, it is clear that they are not going to stop ongoing direct booking campaigns anytime soon, as they are looking forward to having the positive result of the campaigns.

However the travel agencies are against it and the travel agencies like Expedia is trying to find new supporters as the hotel owners who can support the agencies to fight against the moves carried out by hotel chains. These hotel chains sometimes provide lower rates on direct booking on their websites than they generally give to the online travel agencies. By presenting a report, Expedia has shown how hotel owners will be gaining a revenue hit of about 8 percent due to hotel chains decisions to apply loyalty programs by providing lower rates on hotel websites than they generally give to the travel agencies like Expedia.

Expedia has cleared out that the property owners will not be genuinely benefited by the direct booking programs. It will reduce their exposure on the sites of travel agencies and diminish billboard effect. The higher loyalty program costs will lead to reduced revenue of property owners about 8 percent per available room. As per Expedia's report, hotel chains and hotel owners will not get the right revenue by applying such kinds of marketing strategies; they will instead reduce the number of bookings by 50 percent of those bookings that they were recapturing from the online travel agency Expedia.

However the representatives of hotel chains do not agree with Expedia's numbers. They believe that hotels and hotel chains will get positive results of the loyalty programs or direct booking campaigns. An official of hotel chain has claimed that the assumption made by the Expedia that the hotel chains get 25 percent of bookings from the travel agency Expedia is an overstated belief. Thus in their views on direct booking campaigns on hotel chain websites, travel agencies and hotel chains don't agree with each other.


by inerun