Niklas Andréen, senior vice president and managing director – global hospitality, Travelport, explains how the GDS remains a vital sales channel for branded and non-branded hotel chains alike
The advent of Online Travel Agencies (OTAs) and numerous web-based distribution platforms has forced GDS providers to up their game in order to remain competitive.
Travel suppliers, including hotels, have a number of distribution channels from which to choose, and are increasingly looking to cut out the middle man and drive direct sales through their own websites.
At the same time, traditional agencies have needed to stay relevant in a market place dominated by online players. They have demanded the GDS provide access to global content and rates in real time as they get to grips with using technology to book non-air travel products and services.
One of the ‘big three’ GDS players, Travelport, has been tackling these new market challenges head on, according to the firm’s senior vice president and managing director of global hospitality, Niklas Andréen, who spoke to Hotel News Middle East at this year’s Arabian Travel Market.
“Over the past three years, Travelport has focused on its travel commerce platform and has been heavily investing in hotels and aviation compared to its competitors,” he says.
“The question has been ‘how can we make the global hotel content that is out there, not just the content on the GDS, available to the trade?’ Because it should be a natural extension of selling an air ticket.”
He notes that big global hotel brands represent a relatively small share of the world’s total accommodation offering and all of the “key chains” are now available through the GDS.
Travelport’s hotel portfolio currently amounts to 650,000 properties, which has been supplemented by content provided by “a number of aggregators”, including OTAs and leading wholesalers.
The mission now, therefore, is to bring more independent non-branded properties into the fold in order to provide the trade with the most comprehensive range of global hotel content possible, says Andréen.
“[To this end] about a year ago we acquired a London-headquartered company called Hotelzon, a hotel-booking tool with ties to independent hotels, particularly in Europe,” he explains.
“Historically these hotels have had no angle to get into the GDS, but we have now built up an inventory that’s second to none.”
But it’s not just about content, he stresses. “It’s rates and availability, because Hotelzon allows us to distribute its corporate negotiated rates, including tailormade deals for specific partners and markets, in real time.
“This was the last remaining piece of the puzzle – to not only distribute pre-paid rates, but the corporate negotiated rates of big hotel brands and independent chains. We believe we are the global leader in terms of hotel GDS B2B distribution,” he adds.
Agent on board
Of course, providing access to unrivalled inventory and rates is only one part of the equation. Getting agents to sell them is the tricky part, particularly given the trade’s inherent booking traits, which lean towards air-only GDS transactions.
It’s an entrenched behaviour that has made some hotels reluctant to push inventory through the GDS.However, Travelport is doing its best to change the way agents work through training in the use of the Smartpoint prompt; asking flight-only customers if they also wish to book a hotel.
“We are helping travel agencies re-learn their behaviour by rolling out training to help them move away from air-only bookings,” confirms Andréen.
“We have also introduced agent alerts [through Travelport’s ‘Smartpoint’ feature], so if they book a flight, they are sent a prompt to ask them if they have booked a hotel.”
The message is slowly sinking in, continues Andréen, who notes the number of hotel and car bookings per 100 air segments has grown from 41 in 2013 to 43 in 2014.
“I am hoping our full-year results will show further improvements in our non-air performance,” he says.
Additional incentives to book hotels are built into Smartpoint, which allows agents to conduct air and hotel searches at the same time, displayed on the same screen.
Hotel merchandising strategies
Andréen says Travelport’s hotel partners are starting to reap the rewards of distributing through the GDS with sales transactions on the rise.
“Hotels are interested in the corporate business because it tends to be high-yield and what we are offering is this corporate business in bulk,” he says.
Travelport has also refined its hotel merchandising offering, which Andréen explains is “going in two directions”.
“Some hotels want to bundle – where the room is booked but extras such as breakfast and WiFi etc are added on and sold up front. Leisure hotels tend to take this ‘selling add ons’ route,” he explains.
“Others are opting for the corporate negotiated rate or BAR, which already includes extras, designed to help corporates get better control of their costs.
“Where the merchandising comes in is how do we demonstrate on screen the difference between these rates.”
Travelport is also working closely with its hotel partners to refine merchandising in terms of speed and search criteria, whereby displaying pages of rate rules are avoided at all costs.
“We are trying to get hotels to highlight specific data fields, so agents are presented with hotel rates at first glance and know whether or not they are commissionable,” Andréen says.
Work is also ongoing to fine-tune Travelport’s mobile merchandising strategy given the visual constraints of a smaller shop window – the smartphone or tablet screen.
“The challenge is to help travel agencies in the mobile space take what’s relevant, because it’s a different shopping experience,” confirms Andréen.
“We need to work with hotels to jointly structure our services and send out the right information, not all the information.”
