This post may contain affiliate links. We may earn money or products from the highlighted keywords or companies or banners mentioned in this post.
In the first four months of 2015, in the persistent rivalries between online travel agents (OTAs) and hotels, OTAs has achieved a lot. As of now, the channel for distribution which has players such as Hotels.com, Expedia, etc. went through the biggest increase in bookings yet.
As hotel sites experienced profits of 7.1% each year, OTAs attained more than a double of this figure with a rise of 15.1%, states Eye for Travel. While these giants go on consuming smaller rivalries via acquisitions and mergers, the marketing endeavors of hotel sites are fighting to catch up with expenditure which worldwide Expedias’ can pay for.
Actually, a substantial quantity of revenue is being utilized personally by the OTAs on forceful marketing gimmicks so as to contend with one another. Information from STR Global states that following their merger with Orbitz, Expedia now boasts around 60% of the US market share.
In the U.S., different online travel sites are left with an extremely small share; but, US anti-trust controllers do not seem to be extremely concerned about personal markets instead of focusing more worldwide on areas which Priceline leads.
However, Booking.com which is one of Pricelines’ biggest subsidiaries, has been going through its own challenges as in Europe, the battle for rate parity rages on. It is not evident yet, but rate similarity might finally be eliminated forever, providing hotels with the capability of fixing their personal costs for whichever channel, portraying the price of commissions submitted.
In essence, this signifies that once more, travelers would study personal sites for brand as the most ideal place for booking, leaving an opening for a Renaissance of brand loyalty.
In the meantime, Expedia has invested tremendous work so as to keep up with Priceline’s development this year. The firm made an acquisition of sufficient properties to develop its business record to more than 510,000, only 120k less compared to Priceline, after a contract of $1.6B with Orbitz Worldwide.
Even though the previous year the firm conducted a percentage of 53 of its affairs in the United States, Expedia is expanding into worldwide markets with a 65% objective of income to be generated in 2015 from global bookings.
If assumptions in the market are correct, South America signifies readiness for this as it is still moderately unexploited by booking sites up to now. The globe has experienced tremendous development in tourism as well as hotel advancement with the rise of American interest in its southern neighbors.
Remaining at the fore of the curve for technology has been OTAs vital plan as hard work is more and more being concentrated on mobile. Hotels.com, Hotwire and Expedia have even launched apps for Apple Watch, which is a wearable product from Apple together with their mobile products which are already available.
However, Expedia and Priceline need to be more concerned about other things apart from one another’s budget for marketing. New players are available who are making huge ripples already due to their identity, rather than what they are involved in.
Already, Amazon and Google have ventured a bit this year in the world of travel booking; however, they are not revealing their plans fully, leaving others in the sector guessing about what they will do next.
‘Book with Google’ from Google is already operational while they internally test hotel price alerts. At the same time the product from Amazon's Destinations is growing fast after it was started at the beginning of this year.
They might not appear monumental; however, the prospects for combined product presentations from the two firms are what should concern rivalries. In regard to information and how it can be used, Amazon and Google are in their own league.
