Google Facing Fines Even as Offering Grows
Google may be facing legal troubles in Europe in more than one area, even as they continue to expand their offering. The EC has recently leveled a fine on Google Shopping for what it has deemed to be anti-competitive practices (i.e. favoring their own search services). It now looks like that might spill over into other Google search services, including Hotel Ads.
Meanwhile, we look at various ways to deal with OTAs. Can regulatory bodies curb their market share growth? Can hotels truly tempt away guests? Take a look at the articles below for more details.
The recent fine from the EC on Google Shopping comes with the explicit warning that they will continue examining “Google’s treatment in its search results of other specialised Google search services.” Google may therefore have cause to worry about its Hotel Ads offering, which by its own admission is a huge moneymaker in Europe. Google is integrating Hotel Ads into search results, Maps, and Trips, becoming one of the leading hotel metasearch providers in the market in the process. Indeed, research conducted by Fastbooking earlier this year concluded that Google Hotel Ads’ traffic was outpacing that of TripAdvisor.
The question is, though, is this because of a better product offering – or because of unfair advantage?
When booking a hotel, 61% of travelers consider the room’s rate to be the most important consideration factor. Metasearch publishers like Google continue to focus on features that help users find the best price on a hotel room. We recently noticed that Google’s price trends feature (which has existed on desktop and tablet for years) is available on mobile screens. This addition creates another resource for Google consumers to monitor pricing trends of hotels, now directly from their smartphones.
In an attempt to cut out the OTA middlemen, many large hotel chains had also started offering incentives to lure customers to directly book from their websites. Even then, we discussed, how the power of online travel agencies with their vast offerings and their widespread presence seem to be a formidable force to reckon with. However, it seems now regulatory boards are stepping forward to check the growing power of OTAs. Will it make a difference?
The cost of doing business with online travel agencies (OTA) is deemed high, mainly because of commission levels but also due to advertising costs and loss of the direct relationship with the customer. However, the cost of a book direct strategy can be high too. At the end of the day, there are good and bad practices out there, and it’s up to hoteliers to make the most of the opportunities, albeit realizing the costs associated with the various strategies.