A Clean Start to Hotel Distribution Post COVID-19
The days of fearing that Expedia and Booking.com would dominate distribution and bankrupt hoteliers’ business were seemingly over. After gobbling up most of the other third-party distribution sites and building what appeared to be a duopoly, Expedia Group and Booking Holdings found themselves facing shrinking margins and new competition from Google and Airbnb.
But, COVID-19 and the subsequent travel shutdown has flipped hotel revenue and marketing decisions upside down. Understandably, in many cases, traditional channel-mix best practices have been tossed out the window.
Today, hoteliers grappling with the business impact of the COVID-19 pandemic are faced with a difficult distribution challenge: On one hand, there is a short-term need for the revenue obtained by putting heads in beds; this is the lifeblood that keeps staffers employed and the lights on. But on the other hand, there are also long-term profitability and market value considerations, which often necessitate a more stringent distribution approach.
In this report, we examine why recovery hinges on operators remembering past lessons and remaining steadfast on optimizing distribution and channel mix.