Global distribution systems are touting a flurry of recent improvements to their hotel offerings, including higher participation from hoteliers worldwide, better capabilities for rate parity, higher-quality content for corporate travelers and enhanced technological offerings that ultimately could ease the rate-loading process.
With continuing attention to content fees and other aspects of airfare distribution, hotel distribution often is overlooked, said Tom Klein, executive vice president for Sabre Holdings and group president of the Sabre Travel Network and Sabre Airline Solutions businesses, but given the seemingly endless variety of available hotel choices and laborious rate-loading process necessary to get a hotel program right, it warrants further scrutiny.
"The airline discussions get all the headlines, because they're at times suspected of acrimony, and the hotel business continues to crank along," Klein said. "Yet, it's a big business, and the hotel experience matters a lot to the traveler. There are inconsistencies across brands, and there are independents that are really terrific hotels but you don't know much about them, so making a hotel choice is in some cases harder."
Part of the GDSs' focus has been increasing the sheer number of properties available through the system. Louise Meyer, senior director of hospitality and car rental for Galileo Americas, said Galileo has about 71,000 properties that represent more than 400 brands, and that count has been growing. Amadeus has honed in on certain tiers and types in its growth plan. In early June, it announced that it had added 5,000 properties to its system since October, mostly those not previously available through distribution systems.
"Amadeus is focused on the quality as well as the diversity of hotels," said Annette Hogan, managing director of Amadeus' hospitality business group in North America. "At 75,000-plus, we've put the focus on increasing small, independent and budget-type accommodations."
Last month, Worldspan announced a long-term distribution agreement, giving it an increased presence in Latin America via access to 600 chains and resorts in the inventory of hotel distribution and reservations management company CMNet.
Sabre's Klein, meanwhile, said his company was the industry leader in regards to hotel content. "The number's growing, but we don't think it has to grow to infinity, which it almost could because there are always new properties opening," he said. "You have to have a very broad selection of properties, but the industry needs to focus more about the value in hotel distribution."
Part of that value, according to Klein, will come from improved content presentation to the corporate travel segment. Traditionally, that presentation largely has been in a text-based format, driven by efficiency in an effort to expedite bookings, he said.
More and more, however, that presentation is at odds with the booking process to which corporate travelers are accustomed, he said. Many corporate customers are insisting on images, maps and virtual tours to assist in their hotel-purchasing decisions.
"On Saturday afternoon, you're looking to go on a personal trip and seeing all this rich hotel stuff, and when you're in your office three days later and all they have is text displays, it just doesn't feel right," Klein said.
Amadeus' Hogan said her company is enhancing both the text-based and image-based methods of display, knowing that some corporate clients prefer to stick with the traditional displays. Galileo also has been increasing image and virtual tour capabilities as well as bringing in review-posting capabilities to help business travelers make content decisions, according to Meyer.
In addition, Galileo this month will introduce an expansion of its price-listing function, she said. In 2005, Galileo began to quote full hotel pricing with taxes and surcharges. It's now ready for the second phase, Meyer said. "It provides not only full price, but also the different options you have with the room," she said. "We can validate and request bedding types or accommodate if you want an oceanfront room."
Rates themselves also have been a focus for GDSs in recent months. Sabre in late June launched its Rate Assured hotel certification program, which guarantees that the rates listed for particular hotels are no higher than any rates listed on any other distribution channel, including the hotel's own Web site.
The program canvasses rates through hotel market information provider Rubicon, checking up to 235 sites on a weekly basis, according to Sabre. Any hotel that lists a rate more than a dollar less than what is available through Sabre risks losing its Rate Assured designation.
"A large portion of our content will be integrated, so they don't have to look anywhere else," Sabre's Klein said prior to the launch. "With the negotiated rates, we'll make sure they can audit those rates."
Though Sabre claims its rate monitor is the most exhaustive available, other GDSs offer a similar guarantee. Galileo launched a best available rate program about two-and-a-half years ago and now has more than 100 chains participating in the program, Meyer said. As a measure of its success, Meyer said Galileo's average daily rate sold in the system is $164, compared with an industry average of $149, and that difference is largely because of the high preponderance of weekday business travel within the system skewing the number upward.
In February, Amadeus announced that it had signed up 37 hotel brands for its best available rate program, and its guarantee is boosted by the flexible cancellation policies its bookings generally offer, with 76 percent of available rooms capable of being canceled up to 24 hours in advance. The trend is extending to the Asia/Pacific region as well, with Singapore-based Abacus International adding eight brands to its best available rate program in June, one year after the program was launched.
GDSs said it behooves the hotels to participate in the programs. Although it's preferable to them for customers to book through their own channels, they ultimately will benefit from the increased distribution capabilities, they said.
"The hotel business is pretty good right now, but like every other part of the travel business, it's cyclical, and distribution matters," Klein said. "Distribution feels easier when you're at 90 percent occupancy, but what if you're getting outmarketed by competitors in a down cycle?"
Though corporate negotiated rates are a separate matter to be handled by rate loading, best available rate programs could have particular ramifications for corporate travel buyers should dynamic pricing ever gain prevalence. At the same time, GDSs are integrating themselves with hotel management technology, which they said also will help with current rate-loading problems.
Hoteliers are moving to integrate their various technology components, including property management, central reservations and revenue management systems
(BTN, April 23). GDSs also are inserting themselves into that trend.
Sabre's SynXis technology, for example, that puts it into the direct distribution side as well, Klein said. SynXis, which gives hotels a single control center to manage all distribution channels, is the technology source for more than 8,000 properties.
"It's a space that you'll see us investing in, and that will include organic growth as well as if we see something that fits into our portfolio," Klein said. "We'll be looking at acquisition if it makes sense."
Amadeus also is developing tools and systems in the areas of pricing, inventory and availability, Hogan said. Golden Tulip Hospitality last year announced it would use Amadeus' central, multiproperty platform for its property management system, which can be hosted along with revenue management systems remotely through an application service provider. As these services become more available to hotels with outdated technology systems, it will naturally ease the rate-loading process, she said.
"It's an integrated solution for any hotel that's looking to streamline functions and systems covering all processes," Hogan said. "Whatever programs there are, we are positioned to make sure that pipeline for that type of rate is available to support their pricing strategies. In a more forward-thinking world, we're swapping out to better systems, and those issues will be able to be addressed more readily."