Rate Integrity & Rate Parity
May 25, 2010 at 10:08 pm | Posted in Uncategorized | 12 Comments
Tags: hotel blog, hotel industry, hotel revenue management, hotel sales, social networks
I don’t know if there is right or worng answer here as necessity has indicated the ‘dumping’ of unused inventory on the opaque channels.
This is a little story of trust and integrity.
I went online to book an airline ticket on the United Airlines site that states that the customer will not find lower fares on any other site. The fare was almost $600.
So I tried to save my cleint some money and went to Priceline where I haven’t ever booked an airline ticket before. The fare to the same destination with a better schedule was only $300. Granted, United posted in it’s lower fare column the same fare but the flight schedule was for flights leaving at ungodly hours and with hideous layovers.
Maybe I was naive to believe that United meant what it said but it taught me one thing — I will always check on Priceline prior to booking another ticket.
Does your hotel have a similar lowest rate guarantee on your web site? Will your customers find lower rates on Priceline and the other opaques?
Have we created Priceline’s incredible profits last quarter by driving our clients to the opaque channels?
As Seth Godin said in his book “All Marketers Are Liars” our cutomers don’t believe our marketing copy any more, they believe User Generated Content by ‘people like themselves’ as found in testimonials and review sites.
Have we given the power to the review sites that many hotel managers resent by failing to maintain integerity in posting rates?
Think about it — leave your comments and let’s start a discussion!
Advertisement
Like this:
Be the first to like this post.
If you’re wondering whether there’s any level of trust or integrity you need look no further than the name – ‘opaque’. It’s got lack of transparency written all over it.
As you say, hotels proudly declare ‘Best Rate Guaranteed’ on their sites when, what they actually mean, is it’s the best rate as far as you know. In the small print there’s something about opaque sites being excluded but I doubt many consumers understand this term.
Comment by Dorian Harris— May 26, 2010 #
Dorian,
Thank you for your post — my concern is that we are in danger of turning hotel rooms into a commodity just as the airlines have done with thier product.
Carol
Comment by carolverret1— May 26, 2010 #
BION I’m imressped! Cool post!
Comment by Finch— April 27, 2011 #
As marketers we underestimate the savvy of the consumer. There is enough transparency in the “opaque” models and the travel aggregator internet sites to quickly determine the lowest rate for a hotel room or airline seat. So a Best Rate Guarantee is worthless when there is variegated pricing for a product depending on the point of sale. Repeated discrepancies erode consumer confidence ultimately leading consumers to turn to fellow consumers with no skin in the game for the truth…Carol I agree with your perspective.
Comment by Robert— May 26, 2010 #
Robert,
Thank you for your post. The concern is that we risk tuning hotel rooms into a commodity much as the airlines have done with their product. Could this be at least part of the reason that the luxury sector is clearly leading the industry in recovery — the luxury expereince is perceived as a ‘differentiated’ one verus the standard mid market hotel room. Therefore, many consumers are opting for a ‘value experience’ and willing to pay more for it versus a room with standard amenities. Your thoughts?
Comment by carolverret1— May 26, 2010 #
I absolutely agree that the unique product and amenities of the luxury segment creates extraordinary value given current pricing. The consumer will go for the best value rather than the best price in most scenarios. In addition I think that many have had to tighten their belts during the thick of the recession and now we see the demand finally unleashed; consumers wanting to pamper themselves with unique experiences. It will be interesting to see what happens to the demand for luxury travel once pricing is restored and value propositions normalize
Comment by Robert— May 26, 2010 #
Have you heard about Mojofiti.com? http://www.mojofiti.com is a website where anyone can get an international blog and every entry, email and group is translated into 28 different languages for free. It’s awesome, finally a world without language barriers!
Comment by rdpogs— May 29, 2010 #
Hi Carol,
Hotel rooms are a commodity. There seems to be a peculiar objection to this concept in the travel industry. Everything for sale is a commodity.
How else do you see it?
Dorian
Comment by Dorian Harris— June 16, 2010 #
I agree with you that Everything for sale is a commodity. The catchy website with the interesting posts. You give the nice information that many people don’t know before. most of your contents are make me have more knowledge. it is very different. I was impressed with your blog. Never be bored to visit your blog again. Have the nice your time.Keep enjoyed your blogging.
Comment by Andorra discount hotels— June 20, 2010 #
This leads to an assumption that rate parity will really help to strategically build relationships with your distributors. All your partners get access to the same sell rates, and have equal chances in being successful in their marketing efforts.
Comment by Revenue Your Hotel— July 7, 2010 #
Thank you for your comment. The concern really is the relationship with customers although distributors are important. The lack of trust on the consumer side tends to drive them to the opaques and other channels rather than the property’s web site thinking they will get a better deal — and they are usually right. Not only does this damage the loyalty of our customers but also increases the cost of the reservation.
Comment by carolverret1— July 7, 2010 #
How can you get a lower hotel rate in person?
I don’t like the online sites like Priceline because they don’t tell you what hotel you are getting until you’ve already agreed to purchase it. Is there anything you can say to the hotel clerk to get a lower rate? I’m interested in Hilton.
Comment by maya— October 8, 2010 #