Via Reader Alan H., TripAdvisor is finally going big in hotel metasearch as a way to drive bookings.
Hotel chains’ have long tried to push guests towards booking through their own channels, such as by denying elite stay credit (and in some cases elite benefits) to bookings made through online travel agents and by offering their ‘best price guarantees’ meant to suggest that customers will get the best deals there (not always true, it just means that on some rare occasions the chains will reward customers who discover they haven’t).
That’s because the payouts to online agents for hotel bookings are huge, although seem to have been coming down somewhat recently. I used to see major chains paying out commissions in the high 20% ranges, while more recently such high payouts seem to apply more to independent hotels. The savvier big chains like Marriott, depending on the online channel, may be down into the high teens.
Whereas flight sales isn’t especially lucrative, hotels bookings are, and TripAdvisor is naturally positioned to get a strong piece of that action — they (in theory, with problems) guide you towards the hotel that’s right for you. They should be better at monetizing that decision. That’s seen as a threat to Kayak.
Interesting, while the leading threat there ought to be coming from Google, which is certainly trying to provide customized answers and advice in the travel space, the conventional wisdom offered in he article on Kayak vs. Tripadvisor is that Google hasn’t made much of an impact. So much for the anti-trust concerned voiced by Google’s rivals in trying to get the US government to shut down Google as a competitor (mostly, to date, in flight search – and fortunately unsuccessful).
I’ve often found TripAdvisor useful (1) for real guest photos, and (2) to scan common themes in reviews. But never for the rankings, and never for the content of any single review.
There are several problems with TripAdvisor. One is fake reviews — hotels with fake personas trashing their competitors, hotels giving themselves high marks. Another is the inherent unreliability of complainers who also may represent outliers among guests. And still another is the rankings aren’t valid interpersonal comparisons. The guest doing a ranking may simply not think about hotels the same way that you do. And rankings are often simply not reasonable reflections of what a hotel is trying to accomplish (knocking down the Ritz-Carlton Central Park because its room service breakfast is expensive, for instance.. of course it is).
Into the space there are several new review sites, few of which have gained much traction. Hotels have tried to compete as well (remember, they really want you to book direct) with their own reviews. And they can even verify that a guest writing a review has really stayed at a hotel!
The competition here is far from over. But Kayak certainly will face pressure because while they can find you lots of different hotels (compared to chain sites which generally offer their brand only), it doesn’t do a good job at guiding you to book the room that’s most right for you.
That’s the big thing that was lost when mass travel became substantially an online booking phenomena — the loss of human agents who could understand your preferences, combine those with personal experience, and make recommendations that were in theory tied to the individual customer.
That’s also the future once again, even in the online booking space as sites race to get better at doing more than just returning results in a city and letting you sort by price or distance or ‘number of stars.’
No one is very good at it yet. Orbitz fumbled when they started returning higher priced hotels to Mac users.. when all they were doing was responding to their data which suggested that Mac users tended to book higher priced hotels than PC users, and so wanted to give those customers tailored results that were more likely to lead to a sale. They weren’t trying to ‘charge those customers more.’ They just didn’t want the customers not to find what they were after and go somewhere else to book instead.
There’s still a lot of room for work to be done, and contra conventional wisdom the future year is yet to be written. Let alone the future in mobile where last minute bookings are increasingly common, and customized advice won’t just be based on other guests’ experiences (social) but on real-time geolocation data.