Re Google-Hotel Travelopoly

["Dave Farber" <dave () farber net>]

---------- Forwarded message ---------
From: Bob Schulman <bob () rexdog net>
Date: Thu, Dec 28, 2017 at 4:53 PM
Subject: RE: [IP] Google-Hotel Travelopoly
To: <dave () farber net>, ip <ip () listbox com>


Dave,



For IP if you wish.



I am unsure what the point of the excerpt is. It first states that hotels
are being squeezed by OTAs. Then it states that 60% of travelers begin this
travel planning with Google (this does not include me, by a long shot).
Then it states that hotels are working with Google to cut out the middlemen.



A look on Google’s site shows that Google now has a Hotels Prices API. One
assumes the hotels are using this API and it is this use which is the
carries whatever blame and aspersions the article is casting.



All I can say is “Duh”. If I were running a hotel, what would be a more
intelligent and easy first choice in responding to the OTA squeeze except
to use this API?



BTW, the folks who published the research which is the basis of the
article, Skift Research, also state in their “The Future of Travel in
2020”research paper that “The future of travel is … being fantastically
focused on the changing consumer behaviors” and they combine that with the
claim that “Messaging (eg WhatsApp and Slack) is how you (the purveyor of
travel residences) break out of the tyranny of the online travel search
box”. So, um, maybe Skift has an extra incentive to make Google look like a
Bad Dog. Just sayin’.



bob







*From:* Dave Farber [mailto:dave () farber net]
*Sent:* Thursday, December 28, 2017 2:09 PM
*To:* ip <ip () listbox com>
*Subject:* [IP] Google-Hotel Travelopoly





---------- Forwarded message ---------
From: the keyboard of geoff goodfellow <geoff () iconia com>
Date: Thu, Dec 28, 2017 at 1:56 PM
Subject: Google-Hotel Travelopoly
To: E-mail Pamphleteer Dave Farber's Interesting People list <ip () listbox com
>



*Google-Hotel Travelopoly*

*The search giant works with hotels to hurt travel competition.*

https://www.wsj.com/articles/google-hotel-travelopoly-1514419414

excerpt:



More than 100 million Americans are expected to travel during the holidays,
and many will search for lodging online. But travelers may unknowingly pay
more and fail to see all of their options because some major hotels have
ganged up with Google to undercut competition.

Online travel agencies like Expedia, Priceline and Travelocity have
replaced brick-and-mortar agents by offering consumers more choice and
convenience at a lower price. These OTAs purchase inventory from
wholesalers and then market rooms at a discount to consumers in addition to
flights, rental cars and travel packages. Many also have agreements with
companies like American Express, Costco and Delta to market their inventory.

OTA websites let travelers sift through hotel offers based on price, brand,
location, amenities and guest rating, among other search filters. OTAs earn
a roughly 20% commission from hotels for each reservation they book, which
covers their cost of marketing, inventory acquisition, customer support and
payment processing.

As hotels get squeezed by Airbnb and home rental sites, they have begun
complaining that OTAs are eating into their profits. Several major hotels
are now trying to use Google as a counterweight, while Google is exploiting
its search dominance to steer consumers to its travel service.

Some 60% of travelers begin trip-planning on Google. The search giant’s
travel business is worth an estimated $100 billion and will generate $14
billion in revenue this year, according to Skift Research. Google makes
money on travel in two ways. First, it auctions ads that appear above
generic search results. Businesses can bid on key words such as “Hotels in
Houston” or “Houston Hilton.” Google selects auction winners based on the
maximum price a business is willing to pay for each ad click and the
likelihood a user will click on the ad.

Google also operates its own “meta” hotel search that appears below auction
ads and above generic search results. If users search for a hotel, a box
displaying offers from hotels and OTAs will pop up. Travellers may benefit
from being able to use Google’s meta-search to compare offers from hotels
and OTAs on a single interface. Competition from Google’s meta-search could
also spur OTAs to improve their services.

The problem is that Google is working with hotels to stifle competition.
[...]



-- 

Geoff.Goodfellow () iconia com

living as The Truth is True

http://geoff.livejournal.com


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