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One of the most amazing things to me is that a couple of large hotel chains can't come up with a hotel reservation coop that would compete/throw out with bookin

One of the most amazing things to me is that a couple of large hotel chains can't come up with a hotel reservation coop that would compete/throw out with bookin.com et al. If you worry about competition, just found two or three competing coops and be member of them all. SEO? If most hotels are nowhere but in the coop platforms, how can google not display them at top?

bberenberg 6y ago
Antitrust?
- ugh123 6y ago
  Yeah that sounds like price fixing.
xiphias2 6y ago
Mariott Bonvoy chain has member rates for a reason, and they are great, although they could be more predictable so that I could search on booking.com and know the member pricing.
- simonebrunozzi 6y ago
  Can you tell us a bit more about your experience with them? And costs?
  - xiphias2 6y ago
    My favourite hotel with them with value/price with member rate was this Ritz Carlton in Portugal (less than 200 USD/night for standard room): https://www.ritzcarlton.com/es/hotels/europe/penha-longa#HOTEL https://www.ritzcarlton.com/es/hotels/europe/penha-longa#HOT... If you use their site, they give you some money that you can use to eat at their pricey, but amazing restaurants (also 2 of the hotel's restaurants has Michelin star, but I haven't tried those yet). Their swimming pool / jacuzzi is bad, but the nature, the castle and the room is great.
- SergeAx 6y ago
  I never saw any "great" member rates via Bonvoy, they are typically just 5% lower than the street price. And in exchange I should surround my ability to choose from all other competitors. Also, they will not allow mw to reclaim any points/benefits for stays booked via agents. It's understandable, but looks extremely cheap.
  - xiphias2 6y ago
    Sure, I understand it, I also first look at the hotels to go, but I go to a lot of reserves, and the best ones are quite often Ritz Carlton or Four Seaons. Four Seasons don't have member rates though.
btown 6y ago
This is a really good question with a frustratingly simple answer: OTAs like Booking.com have "rate parity" contracts guaranteeing them equal rates to the hotels' direct booking sites and any other channels they use: https://businessblog.trivago.com/rate-parity-hotel-industry-status/ https://businessblog.trivago.com/rate-parity-hotel-industry-... - and these have de facto been upheld in the US court system. So if you're a hotel deciding whether to invest resources into your own branding and marketing, vs. investing it into a brand new coop that itself can't undercut the household-name OTAs that are spending vast amounts of marketing dollars and years of SEO work to make household names, you'll invest in yourself.
- darig 6y ago
  Charge a $1/month membership billed annually to the coop site, and offer a $25 rebate to any coop members when they book a room. Make it very easy to become a member while booking the room... $100/night + $12 coop fee, and after you check-in you get a $25 rebate. The OTAs would still get the $100 price, but hotel would effectively charging $87.
- deleted 6y ago
  [deleted]
- beefield 6y ago
  Well, in my opinion rate parity agreements should be illegal in the first place, as they foster rent seeking behaviour as opposed to fair competition. And if a few large chains drop out of these household names and welcome all small hotels to their coop with fair terms, I fail to see how that would be NPV negative move even if it took a couple of months to readjust for SEO. Price fixing? Just found a couple of competing coops with different seed chains.
  - pydry 6y ago
    This mirrors the clauses VISA/MasterCard have that say that shops can't charge different prices for credit cards and cash which also solidifies rent seeking behavior. I wonder if you could create a similar law for both.
anticristi 6y ago
I always wondered why airlines are not pilot-owned.
- lukifer 6y ago
  United went through a period in the 90's where it was majority-owned by its employees, which ended when it restructured under bankruptcy in the mid-2000's: https://en.wikipedia.org/wiki/UAL_Corporation#History https://en.wikipedia.org/wiki/UAL_Corporation#History In general, airline employees enjoy very strong unions, not only for pilots but also flight attendants.
- missedthecue 6y ago
  Airlines are literally among the most capital intensive industry out there. Where are some pilots getting their first billion for aircraft, flight scheduling, landing slots, fuel, maintenance contracts, etc... Notice how most employee co-ops such as law firms have essentially zero capex requirements. They don't need startup capital that necessitates shareholders.
lotsofpulp 6y ago
They used to have roomkey.com and it would show you all the hotel chains' options. Was actually a very nice site, and you could quickly compare all the lowest rewards member pricing (lower than expedia or priceline offerings, since there was no commission to be paid). They didn't advertise it for years and then and killed it for some reason. It's also possible that certain markets (especially with expiring goods like hotels and airlines) earn sufficiently more money via price segmentation that it makes sense to pay middlemen. For example, if you have 100 rooms in a hotel, and you can sell 20 of the rooms for $x, the next 20 for 1.1$x, the next 20 for 1.3$x, the next 20 for 1.5$x, and the last 20 for 2$x, then the ability to price discriminate might be worth it.

bberenberg 6y ago

Antitrust?

ugh123 6y ago
Yeah that sounds like price fixing.

xiphias2 6y ago

Mariott Bonvoy chain has member rates for a reason, and they are great, although they could be more predictable so that I could search on booking.com and know the member pricing.

simonebrunozzi 6y ago
Can you tell us a bit more about your experience with them? And costs?
- xiphias2 6y ago
  My favourite hotel with them with value/price with member rate was this Ritz Carlton in Portugal (less than 200 USD/night for standard room): https://www.ritzcarlton.com/es/hotels/europe/penha-longa#HOTEL https://www.ritzcarlton.com/es/hotels/europe/penha-longa#HOT... If you use their site, they give you some money that you can use to eat at their pricey, but amazing restaurants (also 2 of the hotel's restaurants has Michelin star, but I haven't tried those yet). Their swimming pool / jacuzzi is bad, but the nature, the castle and the room is great.
SergeAx 6y ago
I never saw any "great" member rates via Bonvoy, they are typically just 5% lower than the street price. And in exchange I should surround my ability to choose from all other competitors. Also, they will not allow mw to reclaim any points/benefits for stays booked via agents. It's understandable, but looks extremely cheap.
- xiphias2 6y ago
  Sure, I understand it, I also first look at the hotels to go, but I go to a lot of reserves, and the best ones are quite often Ritz Carlton or Four Seaons. Four Seasons don't have member rates though.

btown 6y ago

This is a really good question with a frustratingly simple answer: OTAs like Booking.com have "rate parity" contracts guaranteeing them equal rates to the hotels' direct booking sites and any other channels they use: https://businessblog.trivago.com/rate-parity-hotel-industry-status/ https://businessblog.trivago.com/rate-parity-hotel-industry-... - and these have de facto been upheld in the US court system. So if you're a hotel deciding whether to invest resources into your own branding and marketing, vs. investing it into a brand new coop that itself can't undercut the household-name OTAs that are spending vast amounts of marketing dollars and years of SEO work to make household names, you'll invest in yourself.

darig 6y ago
Charge a $1/month membership billed annually to the coop site, and offer a $25 rebate to any coop members when they book a room. Make it very easy to become a member while booking the room... $100/night + $12 coop fee, and after you check-in you get a $25 rebate. The OTAs would still get the $100 price, but hotel would effectively charging $87.
deleted 6y ago
[deleted]
beefield 6y ago
Well, in my opinion rate parity agreements should be illegal in the first place, as they foster rent seeking behaviour as opposed to fair competition. And if a few large chains drop out of these household names and welcome all small hotels to their coop with fair terms, I fail to see how that would be NPV negative move even if it took a couple of months to readjust for SEO. Price fixing? Just found a couple of competing coops with different seed chains.
- pydry 6y ago
  This mirrors the clauses VISA/MasterCard have that say that shops can't charge different prices for credit cards and cash which also solidifies rent seeking behavior. I wonder if you could create a similar law for both.

anticristi 6y ago

I always wondered why airlines are not pilot-owned.

lukifer 6y ago
United went through a period in the 90's where it was majority-owned by its employees, which ended when it restructured under bankruptcy in the mid-2000's: https://en.wikipedia.org/wiki/UAL_Corporation#History https://en.wikipedia.org/wiki/UAL_Corporation#History In general, airline employees enjoy very strong unions, not only for pilots but also flight attendants.
missedthecue 6y ago
Airlines are literally among the most capital intensive industry out there. Where are some pilots getting their first billion for aircraft, flight scheduling, landing slots, fuel, maintenance contracts, etc... Notice how most employee co-ops such as law firms have essentially zero capex requirements. They don't need startup capital that necessitates shareholders.

lotsofpulp 6y ago

They used to have roomkey.com and it would show you all the hotel chains' options. Was actually a very nice site, and you could quickly compare all the lowest rewards member pricing (lower than expedia or priceline offerings, since there was no commission to be paid). They didn't advertise it for years and then and killed it for some reason. It's also possible that certain markets (especially with expiring goods like hotels and airlines) earn sufficiently more money via price segmentation that it makes sense to pay middlemen. For example, if you have 100 rooms in a hotel, and you can sell 20 of the rooms for $x, the next 20 for 1.1$x, the next 20 for 1.3$x, the next 20 for 1.5$x, and the last 20 for 2$x, then the ability to price discriminate might be worth it.