The concept of Listing Syndication is just as prevalent in marketing hotel rooms as it is with real estate inventory today. There are many syndication sites like TripAdvisor, Expedia, Hotwire and hundreds more. In theory, these sites were set up, in theory to HELP hotels, especially with last minute inventory to maximize their ability to sell room nights.
Sound familiar? The Theory failed. What actually happened though was that these sites have disintermediated consumers from corporate hotel sites like Hilton, Marriott, Hyatt and others. It changed the way consumers shop and eroded hotel price points. Moreover, it eroded the ability for hotels to property plan staffing by not knowing how much of a last minute booking bounce they would get. Many people book their hotels on third party sites now, reducing the traffic and relevance of the hotel chain’s websites and costing them booking commissions. We have all had experience where we can get a lower prices on a hotel room on TripAdvisor than at brand sites like Hilton.com.
In a new effort, hotels are chasing the development of a Realtor.com for hotel chains. I was just looking for a hotel room this morning at Hilton.com and I was taken to a new site called Roomkey.com. This site appears to be a collaboration among many of the largest hotel chains – Hilton, Hyatt, Marriott, Wyndham and IHG(International Hotel Group). According to its ABOUT US page, Roomkey.com aggregates rooms from the participating hotel chains, providing consumers a way to shop for a multitude of rooms directly from the corporate hotel chain sites. It gives consumers an option to search for rooms in a particular market beyond just the corporate site they were searching on. For example, I went to the Hilton.com site while booking a room in Asheville. North Carolina. When I clicked on a listing detail page from the search, I was referred over to Roomkey.com to look at the entire available inventory in Asheville, NC for the date I was interested in.
The hotel chains have, in effect, created their own mini-“IDX” system where cooperating companies offer their inventory on each other’s websites. Seems a little late since the airline industry has cooperated like this for years. It would seem it could have moved to the hotel industry than it has.
The real estate already has an aggregation strategy – it’s called IDX.
There is one key difference between IDX and this model., however. Roomkey.com connects the consumer directly to the individual hotel chain serving up the room. Roomkey.com does not host the “listing detail” pages. REMAX.com does this.
The consumer may be better served by this model than the current IDX model, however. According to a study completed by WAV Group called the Consumer Online Real Estate Search Experience, consumers had less than a stellar experience when they contacted agents other than the listing agent. The listing agents is the most educated person about the subject property. Hyatt does not know about Hilton properties either. It’s impossible for any agent to know ALL of the inventory listed in IDX. How can a real estate agent sell effectively when they don’t know their product?
In a scenario where consumers are referred directly to the listing agent or the brokerage, consumers may be better served. In theory, those that they connect with will be able to showcase the property in its best light. This should be a better experience because the listing agent knows the details of the property better than anyone else and will be responsive enough to provide additional details as needed quickly.
It looks like the hotel industry is trying to “put the horse back I the barn” just like the real estate industry. It will be interesting to see how successful they are. Just like in real estate, the individual brands are competing against well-heeled, well-financed, highly promoted brands like Expedia, Travelocity and Trip Advisor. Will hotel chains be able to pool their efforts to unseat the highly advertised, consumer brands that offer easy to use, flexible and highly dynamic hotel search syndication sites? Time will tell, but certainly something we want to learn more about in real estate.