So there are GDS and the conventional travel channels. Then there is the Pegasus network, connecting hotel-owned OLRS to the GDS and to Internet Travel Agents. Then the Internet Travel Agents, big portals like Travelocity, Preview, Expedia, TravelWeb, TravelHero, TravelNow and others most of which connect to Pegasus to link to the hotel chains' OLRS and also to allow smaller hotel to connect directly. You have your Independent OLRS supplying small hotels with technology for a price. Then you have your DMS supplying OLRS systems bundled in with products and services to help Destinations manage their marketing activity.
The marketplace is very dynamic and evolving. Some of these services
will merge and not all channels will survive as distinct options. Here
is what I suspect will happen:
1. Conventional Channel
The conventional channel accounts for the vast majority of hotel bookings and is expected to do so for many years ahead. This channel will remain but it will embrace technology and it will change. Travel Agents will have Internet tools and Internet reservation capabilities for themselves and their clients. To a large extent many will be Internet Travel Agents. Indeed this distincion will fade in the future as agent book hotels and activities on-line for a commission. They will market in cooperation with other agents and marketing groups. Their list of hotels may be extensive or limited based on their individual interests and market thrust. They will have access to Internet OLRS services and hotel inventories.
Hotels will list with this network and maintain inventory, rates and contracts.. Most hotels will choose not to link their own website to a travel agent. The agent will provide hotel information to the client in the form of an webapges and on-line list and feature charts. The hotel information will come from a central warehouse which the hotel subscribes to (maybe something like Pegasus. See 3 below).
2. The Internet Travel Portals.
These players are to some extent the new Travel Agents. They differ in that they do not have retail outlets and offer global systems characterized by huge choice and with little personal contact. They have massive advertising budgets and market exposure.
To subscribe to the Travel Portal (Agent), hotels will list with their network and maintain inventory, rates and contracts.. Most hotels will choose not to link their own website to an Internet Travel Portal. Instead, the Portal will provide their own hotel web information. They will charge commissions for bookings.
There will of course be exceptions. As, for example the new Sabre Internet Hotel Group which hopes to partner with destination sites like http://barbados.org
3. Middle-Ware Intermediaries.
Pegasus is an Intermediary, supplying technology and services to the hotels, GDS, Agents and Portals. Http://barbados.org is an intermediary, supplying DMS and market exposure to a special niche of travelers.
Some of the Independent OLRS will become Intermediaries, but many are more likely to become Internet Travel Agents. The distinction is important. The Intermediary provides marketing services to channel members, while the Agents act to consolidate their own markets and clients.
The Intermediaries will provide priority services and charge clients subscription fees and transaction fees, much as Pegasus does now. They may provide technology to hotels or to channel members. For example, it may supply OLRS technology to a hotel or to a travel agent. However if the bookings are through its own agency, this it is really an Internet Travel Agent.
4. Hotel Websites
Hotels will maintain their own primary websites and enhance them with OLRS that are not aligned with a single agent or channel. (ie. the OLRS wil not link out to a particular Portal or Agent for OLRS services.) It may connect to a true intermediary giving fair access to all, or it may be a propriety hotel system.
The Hotel website is a vital marketing
tool. A survey by PhoCusWrite states that 82% of Internet reservations
are currently made by the Hotel Own website. This is expected to drop
as the other channels become more predominant on the net, but if the hotel
website is well placed with strong brand identification (like http://barbados.org)
it will continue to account for a large proportion of internet bookings
(PhoCusWrite; hotel and Hospitality. The sleeping Giant of Internet Travel.
September 1999).
THE FACTS
· Travel Agents and tour operators account for the majority of hotel bookings.
· 85%
of hotel rooms will still be booked offline by the
year 2001.
· Only
21% of agents use GDS to book hotels. Most use the
phone and fax
· 1.7%
of hotel reservations came from on-line bookings in 1999.
· 81%
of
online bookings are taken from the hotels own website.
· Of
the 16 largest chains none link their website to Internet Travel Agent
or
Portals.
· Many
large chains also list with Travel Portals like Travelweb.
· Internet
Travel Agents and Travel Portals will account for a growing share
of the on-line business for these reasons:
· Other Portal and partnership deals offer them wide distribution.
· Their Internet advertising is often larger than a nations tourism budget
· Internet users like to comparison shop.
· Consumers will get more accustomed to on-line commerce.
Next: Making decisions. Market exposure and Technology Tradeoffs
PREVIOUS:
INTERNET MARKETING NEWSLETTERS.
http://barbados.org/marketwatch
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Internet Travel
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Internet Marketing -Intro mch 8
vol 1. Travel on net mch 12
vol 2a. Promo on the net mch 21
vol 2b. Features of the net mch 29
vol 2c. The new marketing mix Apr 8
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Search Engines
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vol 3. iNet Advertising-SE Apr20
vol3a. Keywords May 2
vol3b. Popularity May 9
vol3c. Java & Scripts May16
vol3d. Final word May24
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On-Line Reservation Systems - OLRS
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vol4. OLRS-1 Dec20
vol4a. OLRS-Pegaus Jan5
vol4b. OLRS-DMS Jan15
vol4c. Channels in Transition Jan24
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