Expedia Group is dedicating $275 million to help its
partners recover from impact of the coronavirus pandemic.
Of the $275 million fund, the bulk of it, $250 million, is
going to lodging partners in the form of marketing credits and financial relief.
The remainder will support destinations, the travel industry at large and
additional supply partner efforts.
Cyril Ranque, Expedia Group’s president of its Travel
Partners Group, says the relief program for its lodging partners was borne out
of conversations Expedia Group had with suppliers about what the OTA can do to
assist them in recovery.
“Candidly, there’s been a lot of [responses] from lower
commission, to give me free marketing money, to give me cash, to leave me
alone, to give me demand data, etc., etc.,” Ranque says.
“We tried to build a program that addresses a little bit of
all of these types of asks, and essentially, they boil down to two different
types of asks: One is, give me a way to get higher exposure, so whenever there
is demand coming in ... I’m on top of that demand to grab more than my fair
share -- and, if you can make it cheaper at the same time, that’d be awesome.”
For each property that participates in the program, Expedia
Group will reinvest 25% of the compensation earned in 2019 from the property
into marketing credits.
Properties will receive the marketing credits -- which range
from a minimum of $200 to as much as $100,000 -- based on recovery signals such
as demand trends for use over a three-month period of their choice to boost
visibility, during which time Expedia Group will also reduce its compensation
by 10% on all new bookings made, regardless of the actual stay dates.
The marketing credits, Ranque says, are a “big give” in that
“it’s money we would have made naturally because hotels would have paid to get
higher exposure. But we decided to give it back to them to just make it cheaper
for them and as a sign of goodwill.”
He added that the reduction in compensation is more of a “symbolic”
gesture, because “what matters in a time like this with very little volume is
not paying less on a booking -- it’s actually getting bookings.” Ranque adds
that forecasted compensation on future bookings is also necessary to define how
much money the company can invest in marketing campaigns.
Although the relief program is available to all hotel
partners as well as vacation rental partners contracted with Expedia Group
platforms beyond just Vrbo, properties must meet eligibility requirements,
which include providing Expedia Group with competitive rates and competitive
fenced deals. The company has already begun piloting the program in Asia.
Elsewhere for lodging partners, Expedia Group is providing
them with proprietary data to track trends, such as website traffic, stay dates
and demand source markets, through its new Market Insights tool, and it’s
helping chains and owner groups manage the distribution of wholesale rates through
a new version of its optimized distribution solution.
On the destination front, Expedia Group Media Solutions is
committing $25 million to destination-led and co-op campaigns that bring
together destination and supply partners with similar audiences.
Of course, launching campaigns is dependent on when a
destination can reopen, but Ranque says the idea is to connect the demand for
travel with the destination as soon as it does.
“The goal is really to tell consumers who are shopping on our
site, ‘This is where you can go, because this is open and you’re going to get a
great experience,’ because it’s actually really hard for consumers to know what’s
open and what’s not.”
Consumer trust is paramount across the industry in
restoration efforts, particularly in convincing travelers to embark on longer
journeys. “Until we rebuild the trust in travel in the consumer’s eyes that it’s
safe, we’re not going to move very far,” Ranque says.
“To rebuild that trust beyond driving 200 miles away from your
home into a hut in the middle of the woods, which is what people are thinking
is safest ... to really make the industry recover, we need to communicate to
customers what the industry is doing as far as health and safety matters.”
To that end, Expedia Group has created a new feature for
lodging partners to highlight health and hygiene measures -- such as available
contactless check-in and checkout, hand sanitizers and social distancing plans --
at their properties.
Although Expedia Group is providing properties with a set of
12 expert-backed guidelines to follow, Ranque says it’s up to each individual
property to follow the recommendations and report its efforts truthfully.
“We’re not judging whether a protocol is good or not. We don’t
think it’s our job,” Ranque said. “What we’re doing is collecting and
displaying what partners are telling us they’re implementing. We don’t believe
it’s our role in the industry to come up with what’s right and what’s wrong.”
The company has also created a complimentary training and
education program, called Expedia Group Academy, to help furloughed and
displaced travel industry workers develop their skillsets. Upon completion of
the program, which launches in June, participants will receive a certification
as well as recruitment opportunities.
Finally, to meet the flexible booking needs of consumers,
the company says nearly 70% of lodging rate plans are refundable on its sites,
up from 50% in February. Travelers now also have the option to filter flights
by flexible fares.
While Ranque says that at this stage in the pandemic, the
worst -- namely, the mass cancellations -- are in the past, “the truth is,
there’s going to be another hurricane, there’s going to be another earthquake,”
“Big cancellations and flexible policies are common things
in the travel industry, we just have never addressed these processes,” he
continued. “These are the things we’re taking a fresh eye on.”