n the real world, hotels compete on
service, amenities and, of course, location, location, location.
But on the Internet, where the efforts are focused on increasing
direct reservations to hotel-branded Web sites, the competition
revolves around repeat bookings, repeat bookings, repeat bookings.
And these days, the competition is heating up.
A few months ago, travelers were able to book a room on
InterContinental Hotels' Web site in an efficient six clicks of a
computer mouse. Not bad. But the hotel chain believed it could do
better.
So in August, after months of reprogramming and upgrading based
on customer feedback, InterContinental added functionality to its
Web site, www.ichotelsgroup.com, that enables guests to book
rooms in a blazing four clicks.
This is an astonishingly low number given that InterContinental
Hotels Group encompasses some 3,300 hotels and 515,000 guest rooms
in nearly 100 countries.
What changed?
Remember me?
The Web site now "remembers what it's told," according to Del
Ross, the chain's director of global e-commerce services.
"Most of the customers who use our site to book are members of
our loyalty programs," Ross said. "So, they are able to store
personal information like city preferences, hotel preferences. They
can store their rate preferences, [for instance] if they qualify
for a government rate. They can store their favorite room
type."
In the e-commerce world, this type of stored information is
referred to as personalization. Therefore, the more guests who
personalize their booking preferences at InterContinental's site,
the more the site's search/booking engine can filter to exactly
what the guest is looking for.
The result is that most reservations can be completed in four
clicks.
Functionality also was added to enable guests to access their
hotel reservation whether it was booked on the site, a third-party
Web site or by an agent.
"The idea is to make it easier and quicker for the customer,"
Ross said.
Fast on the draw
But much as in a western movie, where the fastest gun is
challenged by an hombre who reckons he is even quicker, Fairmont
Hotels and Resorts has its sights set on shattering
InterContinental's four-clicks benchmark when it rolls out its
revamped Web site, at www.fairmonthotels.com. Fairmont promises it
will take only three clicks to complete a booking.
"That's the lowest in the industry," said Jens Thraenhart,
Fairmont's director of Internet strategy. Is Fairmont gunning for
InterContinental? Not at all, said Thraenhart."This isn't really a
competition," he said.
Perhaps not, but one thing is certain: Hotel chains are working
on improving their Web sites with one objective in mind --
tailoring their sites in such a way as to get more direct bookings,
especially from loyal guests.
Great expectations
Thraenhart said he believes customers who book on intermediary
or third-party sites have a different expectation than those who
book directly.
"The person who goes to a travel site is looking to find out
what the options are in the destination," he said. "I think a lot
of people are using the Expedias of the world as search
engines."
Those surfers are "destination focused" and brand neutral,
Thraenhart said.
Conversely, he added, people who book directly already are
familiar with brands, so the sites become an extension of the
hotel's service.
There is another reason for encouraging direct bookings, Ross
said.
"This is our low-cost channel," he said. "I could take 10,000
more reservations today than I did yesterday and it doesn't cost me
any more, whereas if I took those 10,000 reservations by phone, I
have to pay for those calls, or if I take them through a travel
agent, I have to pay commissions on all of them."
However, that's not to say hotels are looking to bypass agents,
who they credit for the ability to sell one brand over another. In
fact, the hotels encourage agents to book directly at their sites
-- or with third-party sites like Hotels.com and Expedia, which are able to move distressed
inventory efficiently.
A new view
"We view Expedia and Hotels.com as partners in helping us drive revenue
during tough times," said Michael Wylie, Wyndham's vice president
of e-commerce. Nevertheless, he said Wyndham, like many other
chains, generally views marketing on the Web differently than it
did years ago.
"Back when some of the hotels and revenue managers were first
looking at [merchant sites], they managed them as a single
distribution source, not as a whole," Wylie said. "Now ... it is
part of our overall strategy."
He said the new Wyndham site generally will be "an upgrade to our
current booking engine that will allow for modifying reservations
online. It also allows travel agents to book and display multiple
rate sets."
The issue of pricing
The site, which will debut during first-quarter 2004, will
feature many Wyndham-only exclusives. That is particularly true
when it comes to rates.
There were times, Wylie said, when third-party sites were
offering rates lower than those found on Wyndham's site -something
guests saw as counterintuitive.
"We wanted to get pricing back in line, either at parity across
the board or better on our site," he said. "We wanted to get back
to our core strategies."
Wyndham, like other chains that found themselves in similar
situations, signed deals with third-party resellers agreeing not to
do that any more. Wyndham now offers nonrefundable and other
exclusive rates at its site.
"Seven years ago, [hotel Web sites] largely were perceived as
marketing brochures that did reservations," said InterContinental's
Ross. "There has been a radical turnaround" in that thinking, he
added.
"Now they are seen as a reservations channel that supports
marketing," Ross said. "The idea is the experience [of booking on
the Web site] should be reflective of the brand."
Branding the site
That is part of the thinking behind Fairmont's new
site.
"We believe we are offering experiences, and we can do that only
on our site," Thraenhart said.
"Let's say you go to Hotels.com, Expedia, Orbitz or Travelocity, basically what you will get is a Fairmont
room," he said. "But you don't get the Fairmont experience. So we
will have product and packages on our [new] site that you won't
find on any other travel site."
With that in mind, the new Fairmont site
will feature Web-only rates more prominently than it did
before.
"We did a pretty good job of hiding them," Thraenhart said. "We
see them as a benefit we are making available to our
customers."
Ross said InterContinental was weighing the possibility of
adding other products to its sites, such as car rentals and air
fares.
"I think it is really too early to tell whether people will buy
other travel products from a hotel supplier, but we obviously think
packaging is pretty important and pretty neat," he said.
To contact reporter Michael Milligan, send e-mail to [email protected].