Amazon’s fledgling relationships with small, independent, boutique hotels could presage a major new distribution channel for hoteliers seeking an alternative to selling on Expedia as well as an innovative way for consumers to shop, analysts said last week.
“Hotels are frustrated with the perceived power that the Expedia group has,” said industry analyst Henry Harteveldt of Atmosphere Research Group. “Hotels would like to see other players come in and potentially challenge or even disrupt Expedia.”
Amazon, analysts said, could meet that challenge as well as provide a new way of selling hotels.
“I think Amazon has the power to redefine the market,” said Bob Offutt, senior technology analyst with Phocuswright, who called the online retail giant’s rumored entry into the travel marketplace “exciting.”
“A lot of people are trying to improve the shopping experience, but nobody has done a really good job,” Offutt said.
Speculation about such a move by Amazon was sparked last month by the online travel news service Skift, which reported that several unnamed independent hoteliers said they’d been approached by Amazon about the possibility of Amazon launching its own hotel booking service.
Amazon declined last week to comment on the report, but Offutt said that such a move would make sense since Amazon’s marketing clout derives from the way it has mastered putting forth offers that interest like-minded people.
“That power of suggestion helps to narrow down the incredibly large choices of places and things to do,” Offutt said.
Currently, Amazon sells hotels and a few tour packages through special offers, generally within a specific time period and including add-ons such as dinner at a local restaurant. Consumers purchase a voucher from Amazon, then redeem it by calling the supplier directly or booking on the supplier’s website.
But Skift reported that independent operators it interviewed said Amazon was planning to introduce a travel service next year that would enable hoteliers to load their rooms and rates onto an Amazon extranet in return for a 15% commission on prepaid bookings.
Hoteliers who currently sell through Amazon last week offered glowing reviews of the service.
“It’s huge,”
said John Robert, manager of William’s Grant Inn, a restored sea captain’s house in Bristol, R.I., that dates back to 1808. The five-room B&B will typically receive anywhere from 50 to 100 phone calls after an offer appears on Amazon, Robert said.
“We’re in New England, and it’s cold and snowy, and we will be full every weekend in January and February because of a deal like this,” he said.
The Inn offers vouchers that include dinner at one of three upscale restaurants nearby. Rates for the packages start at $119.
Amantha Powers, reservations manager for the Pitcher Inn, a Relais & Chateau hotel in Warren, Vt., that has done two promotions with Amazon, praised its sales team.
“Their whole team has been nothing but helpful and courteous and absolutely amazing,” she said.
Tour operators are also moving product on Amazon. Great Value Vacations was selling a six-night castle tour of Ireland, including air and a rental car, starting at $999 per person, from New York Kennedy to Dublin.
Harteveldt said Amazon could be a market-maker for hotels because it has so much data about shopping and purchasing.
Offutt said, “It’s a good move. It will make the existing incumbents in online distribution sharper and make them more creative and innovative in order to compete.”
___
Bell-mouse graphic courtesy of Shutterstock.com.