Buyers Bias Online Tools To Display Preferred Hotels First

Online booking tool providers are reporting that buyers are making greater use of display biasing in their corporate systems to promote preferred hotels. Meanwhile, travel managers are trying to convince hoteliers to trade deeper discounts for prime display positioning.

Buyers use online tools in this manner because the message to hotels is clear, according to Charlotte Blackwell, vice president of product management and marketing at Travelport. "When you show hotels that they are not first, second or even third in the preference list travelers see," she said, "it absolutely motivates them to work closely with the corporation to come up with more competitive rates."

Buyers configure the display with greater program compliance in mind. "Shifting marketshare this way has become a best practice today," said Sam Schisler, global hotel program manager for Limited Brands in Reynoldsburg, Ohio. "In our case, the online tool only displays preferred hotels and only shows them in descending order from lowest rate to highest rate. Our success is measured on how much we save in average daily rate per year. Therefore, I want to be sure travelers are booking the lowest-rate hotel in a market, as long as it's preferred."

Likewise, Christi Hedrick-Waters, hotel program coordinator for Electronic Data Systems Corp. in Plano, Texas, uses the display bias to maximize bookings at preferred properties. Yet, this bid season she is using the display bias to give her additional negotiating leverage with suppliers intent on seeking rate increases.

"If I come to the table and need an extra edge in my negotiations in a certain market because I don't have another couple thousand room nights, I'll offer to put the hotel at the top of the list on the tool," Hedrick-Waters said.

Schisler and Hedrick-Waters have to ensure hotels understand the tools' potential to drive marketshare their way.

"Every online tool works a bit differently," according to Schisler. "Hotel national account managers often don't know how the tool can benefit their properties unless buyers share this information with them."

Hedrick-Waters, who has 1,700 hotels in her worldwide program , not only brings in national account managers, but also, on occasion, property level sales managers at hotels in her program's bigger markets. "We want them to see the different biasing possibilities firsthand," she said.

Hotel officials said they have come to appreciate the share-shift potential. "It's my job to educate my hotels on how they really can use this information to sell their hotel," said Sheri Coppedge, director of national accounts for Marriott International.

"You have to look at the online tool as a way to sell to the end user," said Craig Gardner, director of business travel sales for Hilton Hotels of New York. "There's no longer a third party involved to help close the sale. The tool is it."

Such buyers as Schisler increasingly opt to include only preferred hotels on the display, though the display can include nonpreferred hotels as well.

"This was rare two years ago, but much more common today," said Rob Martin, director of product marketing for Sabre's GetThere online tool. "The more limited display means buyers can be sure travelers will book preferred hotels, if they book at all, which improves compliance significantly."

Hedrick-Waters' tool lists both preferred and nonpreferred options, but she uses its graphical capabilities to help ensure travelers make certain choices. "Nonpreferreds are marked prominently with a red 'ghostbuster' sign," she said. "It tells them right away in no uncertain terms that they're booking out of policy."

Schisler and Hedrick-Waters described their biasing strategies last month at the annual meeting of the National Business Travel Association in Orlando.

Buyers' use of graphics is growing because visual images directly communicate policy. On the Amadeus E-Travel online booking tool, for example, preferred hotels are marked with one, two or three check marks. "An entry with three checks signifies the company wants you to book that property first," said program director Stephen Puente.

One reason buyers are more interested in display biasing is that the tools have made it easier for them to access the system to adjust rankings or change the way hotels are highlighted. "Buyers can get more involved in the process and manage the listings more closely," said Mike Parks, senior vice president and general manager of worldwide distribution for Worldspan, whose online tool is Trip Manager.

Time-pressed travelers are more likely to book a property if it appears at the top of the display, which is why hotels are so eager to be positioned there.

"You want to be what they call 'above the fold,' " GetThere's Martin said. "If the user has to scroll, a hotel can be pretty close to duped."

Time is critical, officials said. "For business travelers especially, the number of clicks it takes to complete the transaction has become very important. The fewer clicks, the better," Puente said.

Display biasing already was an established practice before the advent of online tools.

"Travel agencies for years have been using the ability to highlight different suppliers, whether air, car or hotel, to agents," said Kim Maschoff, hotel program specialist at Consulting Strategies. "Now travel managers have the same ability to preference for the benefit of travelers. This makes sense, since travelers today function as their own travel agents. Instead of being in front of 50 agents, the information's in front of 3,000 travelers. Corporations now have the power to do the preferencing. Consequently, if you're a hotel, you have to answer to me as to where your hotel will be positioned."

Hotels ultimately are interested in policy compliance. "Travel managers can offer better positioning, but hotels really are concerned about the end result," according to Maschoff. "Compliance has been the biggest problem with hotel programs. 'If I give you this favorable rate, can you assure me I'm going to get your business?' they want to know. 'Can you honestly drive marketshare?' "