Distribution isn't as glamorous or well-known as Sales and Marketing, and it lacks many experts in the market. In addition to open positions and heated debates about customer acquisition costs, parity remains one of the topics in this discipline that remains on the agenda of HSMAI Americas Distribution board roundtables.
Below are some conclusions from the last meeting:
Parity Challenge underway:
The topic is still part of the daily life of revenue managers and e-commerce managers today. And even with CADE publishing differentiated prices on hotels' direct offline channels, it's possible to manage (and target) direct online channels through special offers, loyalty programs, and strong positioning.
Need for dynamic pricing:
A common conclusion is the need to move from static rate corporate contracts to more flexible models, such as dynamic rates or discounts on the best rate of the day.
Monitoring technology:
To optimize price parity management, it's necessary to invest in tools that analyze prices across different channels and competitors in real time. This is currently a viable and important technology, even for small and independent hotels.
The consensus among participants was that for most hotel companies, there is no centralized hub for updating all booking channels. Even in a hotel chain with complex channel management systems, updating content across all channels requires significant effort and communication between the head office and the hotels.
Many systems are still not integrated efficiently enough to ensure that a change made to one location is reflected across all channels. Some of the technologies mentioned are those used by vacation rentals to optimize content.
Many agreed that partners don't seem to prioritize support for content development. In fact, some partners often add content fields without informing hoteliers. It was decided that hoteliers should unite and pressure partners to advance technologically in this area.
Given the limitations and challenges, here are some ideas shared by participants to optimize the efficiency of content management.
Best practices
- Have a dedicated team to update the content of third-party partner sites.
- Ensure adequate communication channels exist to allow hotels to inform corporate headquarters about changes.
- Ensure tracking of changes made across all channels.
- Let's take the vacation rental industry as an example, which has a centralized hub to facilitate content updates.
- Hire technology that can assist with image distribution and review sites.
- Use content APIs provided by some partners.
- Pressure CRS and PMS vendors to add more fields to their systems.
Tips for rate parity and leakage
- Terminate (or minimize) contracts that offer static rates and migrate to dynamic rates.
- Conduct test bookings to identify the distribution source that is reducing rates through third parties.
- Include clauses in the contract so that the third party assumes the costs of test bookings.
- Hire a partner to conduct rate research on your behalf.
- By identifying leaks, terminate contracts with violators or grant them capped rates.
- Add clauses to the contract stating that leaks are grounds for termination.
These findings reflect the complexity and dynamics surrounding rate parity in the global hospitality industry. The continued search for innovative solutions and collaboration among industry players are crucial to addressing persistent challenges and promoting more effective practices in rate management.