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I am glad to see that someone is watching. I have watched this for a long time, and suffered under their hands. Small operators wont survive with their might. I have been in a pressing issue with Expedia for some years now. I am still trying to recovery payment for bookings which they say they wont pay after a year has passed, even though they were sent our invoices. I am hoping there is some one to assist with issues like this.
Is there an organization in the US fighting the OTAs? I am the owner of rental cottages in New York State and May have to join Booking.com to survive but their stranglehold on the industry is so appalling. Thanks for any info.
Booking.com refer to our guests as theirs, continually pressure you to correspond with guests and now their Genius campaign demands another 10% discount on prices to secure bookings, and don't provide your guest email addresses. You can't live with them or without them. The only way to operate is to tell all guests to book direct with you, give them a small discount for coming direct, look after then well and hope that they will only use booking.com once. We had guests in last weekend who told us they wished to cancel the second night and they were giving us 24 hr notice. It's hard to argue with them when the perception is they can cancel with no penalty.
Well said Sue- this is how we operate- but we always send a confirmation email ourselves and refer guests to our T&Cs on our own website. To be fair to Booking.com our T&Cs are on their booking summary, and we offer 2 nights minimum stay.OTA's have muscled into the business- they are bully boys and as most OTA's are owned by the same companies this should be looked into as monopolies are not allowed in other industries. I set up our Google for business page, which is our account-is secured by passwords. I spent half a day setting it up adding photos etc,when I looked at the public profile I thought it looked quite good -even had a book now button. That's brilliant I thought until I clicked on it and yes you guessed it-it went straight through to BOOKING.COM rather than our website.I have complained to Google- they said it was nothing to do with them??!!! That it must have been Booking.com with a 'crawler' programme.I have complained to Booking.com who said it was down to Google!!Well we know that Booking.com pay Google shed loads of money and they obviously work in partnership so they are both lying.I have been told to refer this to the govt as a breach of data protection ( as if I have the time right now in high season) but perhaps the B&B Association would be interested in my comments?
There are two sides to every coin. Being signed up to Booking.com has allowed us to have as much business as we can handle, most of the time from a standing start. In year one we were a highly profitable business, and we will increase by 50% in year two, just because we are opening the taps a bit with the OTA. Is that worth 15% in commission. Yes it is, especially when tax relief is taken into account.
But they're very dishonest and overbearing. they treat the accommodation providers (who are in reality their clients) as awkward "contractors" who they are inflicting on their beloved "customers", the public at large. Accommodation searches default at each search to their their "Top Picks". If you want to be a top pick, you pay them more fees - customer satisfaction and review scores don't come into it. 25% commission will get you there though. They are quite open about this (with the businesses, of course, not with the public). And their cheapest price deal is flat out dishonest.
Interestingly, they are currently touting a new idea which allows you into their top picks if you pay 18% commission, and guarantee them total rate parity. I think that this is probably going to land them up in court again.
We're with Expedia as well and, interestingly enough, they send us less than a tenth of the business that Booking.com do. Also we've had far more unsatisfactory customers from that source. Can't explain that.
Interesting comment on room night contribution from Expedia vs Booking.com; are the commissions/margins the same for both channels?
Most of our business from Booking.com and Expedia is actually hijacked from our high rating on Trip Advisor, Our position on the Booking.com website is on the second last page of 16 pages and has been since we joined them. No one searches through all those pages and as a five star B&B few people do a search based on "highest to lowest." So basically we work to climb on Trip Advisor and these two OTA's then pop up saying they have the best price blocking our entry and the link to our website (which we pay TA in the thousand of pounds for). We ARE cheaper on our own site and a few might note the little banner on Trip Advisor telling them but many more see the enormous "Book Now" banner.Our ONLY cancellations are through OTA's. Two today alone and both charged full price as per our terms and conditions despite them thinking it was free because of the Booking.com advertising. Well let them talk it through with Trading Standards because our terms are quite clear on the BC website and on the confirmation sent to the guest.I agree, if OTA's insist we have to abide strictly by their terms if we have to cancel then the guest should also have to abide too and they should support us.
Yes I am afraid this is sadly only too typical of the reports we get from members - do email us at email@example.com if you would like to give us more detail, as we compile evidence for the competition watchdog, the CMA
We have resisted the pressure to join an OTA as we are very small and run a 'life style' business. I know we miss a lot of business, but at present we have enough - I just hope this continues until we no longer wish to trade. With tax changes and OTAs this may be sooner than we would want!
Try typing in bing.com into your browser and you'll see how easy it is to break google's 'monopoly' power
According to NetMarketShare (April 2017), Bing has 7.31% market share in search, whilst Google has 77.43%; and Google's share rose last year from 67%, taking another 10% of the market from its rivals in just 12 months
That's what comes with innovation, if they stop innovating they will soon fall, just look at Nokia.Monopoly: "the exclusive possession or control of the supply of or trade in a commodity or service."What does google possess exclusively, the data from the internet that it scrapes and puts into a easily searchable format? No, because anyone can scrape the same data.
And the point of the matter of providing a bunch of stats is...what? Google has a larger share because they have the best product and the best algorithms. We empower this every time we use Google. Or Facebook. Two very voluntary actions, on our part. So we punish them for that? I'm not sure how your understanding works here.... I do understand that unfair trade practices need to be kept in check, but penalizing them just because they are large and have provided a service?
My article is not about Google and does not mention "monopolies". However. we do NOT think that B&Bs and hotels should be forced by OTAs to allow the OTA to "bid" on the property's own name on Google; that should be a separate agreement expressly agreed to by the property whose name it is.
Even if their name isn't a registered trademark?
Expedia charge us a higher commission rate and then use some of this to discount our rate. So no matter what our official rate is, they undercut it and therefore appear cheaper on comparison sites such as TripAdvisor. This is an unfair practice, when they don't allow us to offer cheaper rates to customers booking direct.
Diane, please do email the Association about this. We are compiling a dossier of evidence for the CMA, European Commission and others.
The CMA reminded hotels and B&Bs that we are allowed to offer cheaper rates through other OTAs, but re-affirmed that OTAs can still force us (through "rate parity" clauses) to sell at the same (ie commission-inclusive) rate to our own customers directly from our own websites as we offer through the OTA. These "rate parity" clauses drive up the price consumers pay, and have been banned in France and Germany. We are calling on the CMA to ban them in the UK.
Have you done any research into how many of these hotels offer lower prices on own homepage? I have. And in most cases be seen that hotels have not bothered lowering the prices simply because the cost-benefit analysis shows that the level of bookings are coming from a own homepage does not come closer volumes offered to an OTA. I can give you little trade secret. OTA don't check the Independent homepages of small hotels. It is too time consuming and resource intensive. Also it is too much of threats of bad publicity to make a big deal of this.
The hotels who work with OTAs cannot offer lower prices on their own homepage, because they are prevented from doing so by a "price parity" clause imposed by the OTA! These restrictive clauses have been banned in France and Germany as anti-competitive and raising consumer prices, and yesterday we formally called on the CMA to ban them in the UK.Secondly, yes the OTAs do check hotel websites for pricing, and availability (it can be done with web 'bots' these days), and hotels get calls from OTAs requesting changes. Our members have told us that, if their pricing or availability on their own website goes against what an OTA wants to see (eg the OTA would like to take more of the B&B's availibility), the B&B's search ranking on that OTA drops sharply, so business falls off as a consequence - B&Bs see this as "punishment" (however the OTAs deny they ever do this; the more evidence of it we collect, the better).
Which just shows that you aren't quite sure how bots work, are you? Shopping Bots follow a complex algorithm who's success is predicated on the target website being fairly static and similar. Eg Booking.com. Prices are displayed, hotels have their own page, the setup is similar in matter which hotel you check, same terminology. Easy to shop with bots. And then you have the nightmare of trying to shop every single independent hotel, with individual websites, own naming conventions, constantly changing web addresses, unpredictable availability and updates.... Bots don't work. Usually hotels have lower prices on a competing OTA, which triggers the call. And why not? If you have lower prices elsewhere, you can't expect to get top position, can you? OTAs, like any other business, will protect their loyal customers.
Here we go again. Plenty of arguments about why the OTAs are the big bad wolf. But let's look at this from a customer perspective as well, shall we? As one, I want to book on a globally recognized platform with good customer service no matter where I travel, or whichever country I find myself in. I want a rewards program independent of whichever chain I am staying in, which accrues even in the smaller independent hotels. I want to be able to compare across brands and locations, across star ratings and guest reviews. Rate parity is good for me, since I can be sure that the price I have found on my favorite brand is the best there is. I don't care what the hotel has on their own page - I'm never going to book direct at a smaller hotel without the guarantees that my booking is secure, and that I have a fallback option if I turn up and they say "Sorry, we're overbooked". Yes, some will help, but this doesn't apply across the industry, and globally. The first comment below - true, you can choose to stop working with an OTA. But only if you yourself have a stranglehold on the market and are able to dictate the price, never mind the competition or what the customer wants. So as far as I am concerned, that's a negative for removing the OTAs. And then we come to the ideal scenario where the OTAs go away. You really think the larger chains will be accommodating and brotherly when they are the only player in town with deep pockets? You think they'd calmly let that little independent take their business without going into all-out war with price dumping? Sure, ask the smaller independents in secondary and tertiary markets how they've fared. This is where OTAs some in as the leveller, and create a playing field that allows everyone fair access. As an independent, try and bid on all search engines, and see how much is spent on SEM and DSA. Create a mobile platform and webpages in 50 languages, and keep it updated and relevant. There's a lot that goes on behind the scenes, and it costs money to make money.
I have looked at it from a customer perspective as well - and as I said in the article, I don't think customers deserve fake discounts, false statements, and search results which do not reflect their needs. I also don't think that customers should have to pay higher prices because of the restrictive practices of the OTAs.
Absolutely spot on article David - we stopped working with the OTA's 2 years ago and now all of our bookings are direct. It has made an enormous difference to our B&B but we are very lucky - there are only a handful of B&B's in our area so we have the luxury to chose direct bookings only.
When we did work with the OTA's we found all of the practices you refer to - misleading our guests into booking 'the last available room' and showing false discounts, dominating our online bookings and almost preventing guests from booking direct. The CMA really does need to ban price parity and their market domination - ultimately the guest pays for it all anyway. The current trend of encouraging guests to simply 'cancel' is very damaging for business. I read a very interesting article from the CEO of Hilton hotels UK who said it has impacted them badly but they now offer preferential cancellation terms to guests who book direct.
Hi David, I'm referring to your last sentence ... this is not something I have been able to replicate. Do you have more insight on that? Does it concern the Web Saver rate only? very interested in the subject. thanks
Totally agree - OTA's say they work 'in partnership' with B&B owners - really? We had a case in Blackpool last year when an OTA changed the Terms and Conditions relating to Deposit payments and Cancellations of all B&Bs on their system - without informing their "partners". The amount of negativity that raised between B&B owners and guests was huge and the OTA initially refused to change the T&C - even though it was our business. However, due to the market share/advertising they have it's an uneasy bed partner.
How did these OTA's get 80% of the market, because all of the accom suppliers signed up to them, and now they complain.
I have tried to explain some of the reasons they now have so much of the market. Now hotels and B&Bs have the unenviable choice between putting up with the unfairnesses I have described, or forgoing the huge volume of bookings going through the OTAs. In any case, these unfair practices must be stopped by the competition regulator. It is glib and wrong to say we "brought it on ourselves" - these OTAs, as I explained at the start of my piece, started as a benefit, and have now turned into something very different.
I'm pretty sure they started as profit making entities, providing a service for money, and they've been pretty successful at that. I work with both hotels and OTAs, and I'm pretty sure that hotels can choose their cancellation policies. Even in the picture above, I see that some hotels have free cancellation and some don't. Sometimes people tend to forget that the ultimate aim of the OTA and the hotel is to service the client and a lot of the procedures and processes put in place are an attempt to get as much business as possible from the end client - if the client demands cancellation policies up to the day of arrival, then the hotel that provides that service will get that business. That is a competition that exists between hotels, and not between hotels and external service providers.
sorry David -i think your initial article is rather naive - OTA 's met and are still meeting the needs of the modern traveller - i am always amazed at how often you phone an hotel asking to book direct or even ask at the reception to book a room only to be quoted a rate that is way higher than any online rate
Hi Tom, speaking as a small B&B owner (5 letting rooms); we find that the OTA is great for profile, but it's a double edge sword; we are almost held to ransom - get into bed with the OTA or lose business. We find that our guests that come via the OTA don't have any affinity with us prior to arrival (this changes once they have stayed and experienced our hospitality); we send emails - which can only be done via their extranet - which never get read, these have important information for the guest such as check in time, location details etc. Guests tell us (when they arrive at 11pm in the evening....) that they don;t bother reading emails via the OTA once they have booked as they just get bombarded with marketing - so how do you sort the wheat from the chaff? We offer a guest experience that starts at the reservation, this hampers us. We get bookings one day that then get cancelled the next, we get people turn up with dogs even tho' we don't allow pets and it states clearly in our policies. OTA's are not listening to either their hosts or their customers - and that is what needs to change. Do consider booking direct and support the smaller businesses of this world - you will find that the majority of B&B's will never charge more for a direct booking - in fact you will probably be surprised at the added value you get - and a more personal service.
The challenge is how does a guest find you to be able to book direct? Hotels have outsourced their digital marketing to OTAs. Many do not have a strong social presence, are not telling their brand story as part of the destination experience, and are definitely not listening to the social chatter and engaging online. I created and implemented a strategy for a NY hotel to do just that and they started getting direct bookings. But with many other hotels I talked to they are so invested in dying marketing trends and paying OTA commissions that they are not able to focus on better digital marketing, which is what the OTAs are taking the most advantage of.
Love to book direct but you all have seemed to signed up to rate parity with the OTAs. The OTAs already have my card details on file, so why would I go through extra effort without anything gained (cheaper price). Oh yea, and I get genius rewards from booking.com. So booking direct isn't cheaper and no rewards.
Why don't you try asking a hotel or B&B what advantage they offer if you book direct? They may give you added value - and they are "allowed" (even with rate parity clauses) to offer lower prices direct via "offline" channels - eg a telephone call - or even online to a "closed user group" (eg past customers - we reward loyalty too). If the UK bans restrictive "rate parity" clauses as France and Germany already have, hotels and B&Bs will then be able to give you those direct-booking advantages online, too.