This excellent article I found on HospitalityNet.org provides significant insight into the issues every property manager seeking to develop an online reservation strategy has to anticipate. The article takes one through some historical pricing scenarios out to comparing some of the most recent trends in the rapidly changing online travel landscape.
HospitalityNet.org: The End of the Merchant Model as We Know It | By Max Starkov and Jason Price
While the article is informative, one of the key questions I find unanswered is: "Why does the hotel industry not work more closely with travel agencies, who charge only 10% to bring the client to their front door?". As travel agency counts "are declining at a 10% annual pace in North America", the lack of popularity of this approach is very much apparent. On the other hand, constant attacks on the entire travel agency model is also a very large contributing factor to this overall decline in operations.
To me, it seems dealing direct with the travel agent is still one of the most economical methods available for acquiring new clientelle who are likely to develop a trust relationship with the operator and will subsequently book online, direct with him.
My experience indicates that hoteliers and destination resort operators tend to neglect better exploitation of this approach while preferring to deal with participants in the more expensive "Merchant Model" where direct reservation acquisition costs range in the 18 to 40 percent range and usually involve an extended billing/payment arrangement.
Weaning one's operations of wholesale relationships is wise. However travel agencies should continue to be considered as one of the most economical approaches to filling empty rooms with satisfied clientelle, at better rates.
Sites of interest:
www.hospitalitynet.org
Hospitality eBusiness Strategies, Inc. - www.hospitalityebusiness.com
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