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FROM RATE PARITY TO RATE PERSONALIZATION
how to stay competitive in big data market
#WIHPACADEMY
« rate parity agreements between hoteliers and OTAs
represent rational business interests rather than anti-competitive behaviour »
US District Judge Jane Boyle
rate parity could still be legal…
« standard retail rate model, which is the way we’ve done business
for the last 10 years, is going to become a smaller part of the way we do business »
Expedia President and CEO Dara Khosrowshahi
…but it’s definitely a thing of the past
on december the 15th, 2014booking.com drops the rateparity contract clause to end french, swedish and italian antitrust probes
and some big players are dropping it
#WIHPACADEMY
THE 4 LEVERS OF R.M.
WIHPHOTELS.COM
Rate Strategy Inventory Control
Marketing ActionsDistribution Mix
#WIHPACADEMY
THE 4 LEVERS OF R.M.
WIHPHOTELS.COM
Rate Strategy
THE END OF ONE-SIZE-FIT-ALL-RATE
OPAQUE RATES, SOCIAL MEDIA RATES
SPECIAL OFFERS, PROMOCODE AND COUPONS
THE FUTURE OF RATE PARITY
« lawsuits didn’t kill hotel rate parity. it is big data, analytics, retargeting and
personalization that are making enforcement of rateparity provisions untenable »
Dennis Schaal, Skift Editor
SAME ROOM, SAME DAY, DOZEN OF RATES
• € 99,00 - OTA• € 95,00 - FACEBOOK: • € 90,00 - WALK-IN (morning)• € 89,00 – TRIPADVISOR• € 75,00 – RETURNING GUEST • € 65,00 - GROUPON • € 49,00 - WALK-IN (late
evening)102% PRICE DIFFERENCE!
METASEARCH: FROM POP-UNDER…
… TO CORE PAGE RESULTS
#WIHPACADEMY WIHPHOTELS.COM
hotel
guest
wholesaler
tour operator
agent
119€
reseller reseller
115€ 99 € 99 €
OTA website
85 € 89 €
RATE PARITY
#WIHPACADEMY WIHPHOTELS.COM
hotel
guest
119€
115€ 99 € 99 € 85 € 89 €
RATE PARITY
website
THE IMPORTANCE OF ANALYTIC TOOLS
in a data-driven world rate parity is anachronistic.
STAY IN THE MARKET!
offering the best rate on your site does not mean increasing rates on the other channels.
set a starting price and discount it on direct channels,not the other way around!
BILLBOARD EFFECT STILL COUNTS!
THE 1 USD THEORY
1 USD difference means a lot when you’re shopping on eBay or Amazon
why should it be different for hotels?
1 USD DIFFERENCE IS VERY VISIBLE NOW
BILLBOARD EFFECT IS HERE TO STAY
a clear price point in the marketis essential to get the best visibility
on big distribution channels
if you’re invisible there, you should be prepared to
triple your advertising budget
OTAs AND OPAQUE RATES
In 2012 Priceline.com launched Express Deals
Hotwire.com is also engaged in similar services
Travelocity has Top Secret Hotels
Qunar (Baidu) offers users a opaque booking program
Expedia and Hotels.com regurarly use A/B tests to steer certain users towards more expensive hotels.
OTAs AND OPAQUE RATES
"as a user, it’s almost impossible to know whether the prices you are being shown have been altered, or if cheaper products have been hidden from search results »
Christo Wilson, assistant professor at northeastern university
#WIHPACADEMY
STUDY BOOKING WINDOW PER CHANNEL
WIHPHOTELS.COM
120 Days
90 Days
60 Days
Less 30 days Arrival
Groups M.I.C.E Tour Operators OTAs and Direct
#WIHPACADEMY WIHPHOTELS.COM
90 Days
60 Days
Less 30 days Arrival
USA China Italy & Europe
STUDY BOOKING WINDOW PER COUNTRY
#WIHPACADEMY
Booking.com
Tripadvisor
Expedia
OTAs
WIHPHOTELS.COM
H
Booking.com
Tripadvisor
Expedia
OTAsH
H
H
H
#WIHPACADEMY WIHPHOTELS.COM
H
#WIHPACADEMY
THE 4 LEVERS
WIHPHOTELS.COM
Rate Strategy Inventory Control
Marketing ActionsDistribution Mix
#WIHPACADEMY
THE 4 LEVERS
WIHPHOTELS.COM
Marketing Actions
USE RETARGETING OPAQUE RATES
#WIHPACADEMY WIHPHOTELS.COM
Vertical Search: The new booking path
#WIHPACADEMY WIHPHOTELS.COM
Metasearch Ads to increase revenue
#WIHPACADEMY WIHPHOTELS.COM
Targeted Metasearch ads to maximise ROI
9
#WIHPACADEMY WIHPHOTELS.COM
IT’S EASY TO OVERCOMPLICATE
9
#WIHPACADEMY WIHPHOTELS.COM
IT’S EASY TO OVERCOMPLICATE
#WIHPACADEMY WIHPHOTELS.COM
GREAT USER FRIENDLY DESIGN
#WIHPACADEMY WIHPHOTELS.COM
CLEAR CALL TO ACTION
OTAS OR DIRECT, FINDING THE RIGHT BALANCE
KEY TAKEAWAYS
WIHPHOTELS.COM #WIHPACADEMY
Use OTAs and MetaSearch for billboard fx
Break Parity Rate but stay in the market
Use opaque rates and advertise on meta
Provide a great user-experience on your website
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FROM RATE PARITY TO RATE PERSONALIZATION
how to stay competitive in big data market
#WIHPACADEMY
