The World is evolving at a rapid pace. It seems as if every aspect of our lives is changing, some more drastically than the others. It is obvious, that the hospitality industry is also adjusting to the modern society. Some would say the changes are dramatic. It has undeniably gone through a significant transformation. One of the aspects that changed the most is the booking process. Today we will discuss what are the modifications it underwent and what may be its future.
At first, the booking process while not being complicated, was surely very inconvenient. The guest had to call the hotel to make a reservation, or simply drive up to it in hopes of it having free rooms. Without the internet, it wasn’t easy to find the right number, and while the phone books could help, they were not of aid abroad. Guests couldn’t risk going from one hotel to another to compare the prices, they usually booked what they could find. That meant a few things – overpaying and not getting the right quality nor location.
Creation of the internet brought new possibilities. Hotels could showcase their data online, making it easier to find them. Emails created a new channel for making reservations, making it quicker and more convenient to find out if the property has free rooms. It also allowed the hoteliers and their guests to keep track of their bookings, all in one, easily accessible place.
The Modern Era of Bookings
With the growth of the Internet itself, came the success of new booking tools. Specifically, the booking platforms. The Online Travel Agents are now the force to be reckoned with. They are monopolizing the bookings market and taking over the entire process. Many hoteliers, while at first optimistic, happy to have another channel to advertise their properties, are now becoming increasingly more sceptical. There are a few reasons why.
Firstly, the rate parity clauses are causing a lot of tension. The main purpose of these legal agreements is ensuring, that the hotels give the same rates for the same hotel rooms on all channels they use. That means, they can’t give any discounts, even on their own websites.
Secondly, the large commissions are ruining the cooperation. For each booking the hotels have to pay a fee of up to 30% to the OTAs, making them lose revenue and become angry with these relations.
Knowing all that, what can be the future of bookings? Are the direct bookings doomed? Do hotels have to accept it the way it is?
Not necessarily. While the power of the OTAs is growing, so is the dissatisfaction with the current state of affairs. Hoteliers are tired of getting used. They want to feel that they are in charge of their own properties. That it is their decision whether they get bookings or not. That no one is trying to take away their power in this matter. To achieve that, they are trying to fight back.
Firstly, each year more countries see the rate parity as a harmful agreement and delegalize it. In France, Italy and Austria all types of rate parity are entirely illegal with Switzerland and Belgium following those steps. Germany applies regulations to certain OTAs. In Australia, New Zealand, and the European Union, a few OTAs have adopted narrow rate parity clauses. Although many countries still allow it, we can see the change slowly happening.
Another option is creating new platforms, without the rate parity clauses and commission. The need for such a platform was the main factor in creating our website, Bidroom.com. We believe in fairness and transparency. That is why we do not charge hotels commission, nor include any unfair clauses in our agreements. We simply ask the hoteliers to give discounts on their room prices on other platforms to the travellers booking via Bidroom. They choose the percentage of the discount they give. We also ensure direct bookings.
We believe the change is possible because we are a part of the change. The future of the booking process should be based on fairness, clear rules and mutual understanding of all parties involved.