Hotels Employ New Strategies to Thwart Online Travel Agencies

Mintel Finds Hotels Vying for Control in the Online Booking ArenaChicago (September 5, 2006)— Hotels are waging new campaigns to get online travel agencies to check out of the travel arena, according to a new Mintel report. With online travel agencies growing revenues to $18.4 billion in 2005, hotel Web sites found themselves posting only $14.4 billion over the same period. By comparison, in 2003 hotels were the forerunners in the online booking game, posting $4.2 billion in revenues to the $3.7 billion from online travel agencies. Over the years, consumers have gravitated toward the online agencies resulting in stronger growth. To regain its ground, the hotel industry is employing new strategies.After 9/11, hotel companies allowed excess inventory to be sold by third-party Internet sites at discounted rates. This helped to spur increased traffic, but resulted in lower direct online bookings for hotels. With the hotel industry showing signs of robust growth, the direct hotel companies are trying to expand their sales in the online market. With reservation rates rising, hotels are resorting to limiting third-party inventory and promising the lowest prices through their own hotel brand sites.