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Hotels forced to undercut internet rivals
More hotels are being booked online than ever before, but consumers are not booking direct with hotel websites because they are finding lower rates elsewhere on the web. When searching for the cheapest room rate in UK hotels, a survey by KPMG found that 58% of the cheapest rates were offered by an online travel agent rather then by the hotel direct. In Western Europe as a whole the figure is about 45%. In the US, online agents like Expedia and Travelocity offer the cheapest hotel around 10% of the time, because in 45% of cases a corporate travel agent offered the best rates, according to KPMG. KPMG’s Global Hotel Distribution Survey 2004 researched room rates through multiple online channels and direct channels (including calls to the hotel and hotel call centre) from 310 hotels in 13 countries. Only 2% of hotels showed consistent pricing across all direct and indirect channels. But hotel groups are fighting back by offering to better internet rates. KPMG director of hotels Nick Pattie said: “Most major hotel brands are announcing best-price guarantees to woo back customers from the online agents.” He said that if a customer booking a Hilton hotel can find a better deal elsewhere, Hilton will match the deal and offer a $50 refund. According to Mr Pattie, 14% of US hotel bookings were generated from the internet in 2003. A separate study undertaken by the Centre for Regional Tourism Research in Denmark found that online accommodation bookings in the UK had grown 80% between 2001 and 2003. The centre says that the consumer experience of booking no-frills carriers online has given people confidence to book a hotel online as well. Report by Ginny McGrath
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