A recent Hilton commercial that shows people tapping away on their phones and computers as the Rolling Stones song “(I Can’t Get No) Satisfaction” plays seems relatively benign, as does the tagline, “Stop Clicking Around.”
But it is one more – very expensive – salvo in the long-simmering tension between hotel chains and online travel agencies like Expedia, as each try to grab their share of customers.
The marketing campaign, developed by Fold7, which is based in London, is the largest such initiative in Hilton’s 97-year history. It premiered during the Grammy Awards broadcast last month and is appearing online, during major television broadcasts, on billboards and in many magazines and newspapers.
The symbiotic relationship between hotel chains and online travel agencies has been under increasing strain for some time. While online travel agencies offer consumers a wide array of options and bring customers to hotels, they do not develop the holy grail of customer relations: brand loyalty.
According to Phocuswright, a travel market research company, 34 percent of people in the United States used online agencies for their travel needs last year, and 66 percent booked directly, slightly up from 2013.
Last year, the Marriott chain, which includes the Ritz-Carlton, ran its own campaign, ” It pays to book direct,” that featured the YouTube personality Grace Helbig and offered perks such as free Wi-Fi to Marriott loyalty customers who booked directly through the hotel, rather than through a third party. Next month, Marriott will add more benefits, including exclusive member rates and the ability to use its mobile app to check in and out.
Hilton is also offering similar deals to members who book directly.
“I think what Hilton is doing is quite creative and has the potential to be very, very successful,” said Henry Harteveldt, founder of Atmosphere Research Group, a travel industry research company. “It’s all about building trust in the Hilton website, and the most effective way is to go after the online travel agencies.”
Some online, and even off-line, travel agencies are not very happy with Hilton’s public move.
Cyril Ranque, president of Lodging Partner Services for the Expedia Group, called the hotels’ campaigns, “an ill-conceived strategy in the long term.” Expedia Inc. owns, among others, Hotels.com, Hotwire.com, Trivago.com and Travelocity.com.
Mr. Ranque said that most consumers who were shopping on Expedia and similar sites were “brand agnostic,” meaning they do not really care where they book as long as the hotel meets their needs.
“We have an algorithm that puts forward the most attractive and appealing choice for consumers,” he said. “If hotels are consistently not offering the most attractive prices to consumers, our algorithm would push other hotels ahead.”
Mr. Ranque also said that the hotels would lose customers who would have been directed to the hotels’ websites by a third party.
“We’re trying to make them understand it’s a bad approach,” he said of Hilton.
Read rest of the article at: New York Times
