Recently, Travel Tripper, IDeaS, and OTA Insight joined forces to host roundtable discussions on current trends in the fast changing world of revenue management.
Meeting in Orlando and Miami, the distinguished groups of industry leaders and experts covered a wide range of hot topics, including artificial intelligence (AI), machine learning, and the emergence of Airbnb as a distribution channel. Here are some of the key takeaways and highlights from the events.
Airbnb as a distributor
Airbnb has been making a concerted effort to attract hospitality providers to its platform. Travelers can now book boutique hotels on Airbnb, which charges commission fees at 4-5%. As we discussed last year, the platform has experimented with dedicated pages that only feature hotel listings.
In terms of stay length, corporate travelers are leaning towards short stays of one to two nights, a preference that is in favor of hotels instead of Airbnb. However, longer stays are starting to shift towards Airbnb.
Another key point of discussion was that while Airbnb offers a broad spectrum of experiences, hotel customers know what they are getting, and there will always be a need to capture this customer segment.
The changing distribution landscape
The distribution model is expected to change drastically with the emergence of vacation rentals and properties that offer a variety of rooms and experiences. This will create a unique blending of vacation rentals and standard hotel rooms. Just recently, Marriott entered the vacation rental space with a six-month trial in the UK, adding 200 homes available to rent across London.
In Asia, markets are growing and guests tend to book through tour operators and agencies. In contrast, North American travelers act like their own travel agents and make direct bookings.
Disruption is occurring everywhere across the industry, leading to greater segmentation. For example, cruise ships are beginning to diversify by offering different experiences from the traditional family-orientated cruise. Virgin Holidays is also offering everything from luxury backpacking to glamping adventures in an effort to expand its addressable market.
Overall, the importance of innovation has never been higher—driven by intense industry competition and the importance of standing out from the crowd. Guest loyalty also remains a hot topic, and the need to capture guests for the long term and secure repeat business has never been so crucial.
OTAs vs. hotels: who owns the customer?
We’re beginning to see global chains crack down on the OTAs commission structures. Last year, lobbying efforts by the U.S. hotel industry were planned against OTAs in an attempt to shake up the duopoly of Priceline Group and Expedia.
