Marketing initiatives by hotels chains such as Marriott and Hilton which talk up the benefit of booking direct, have not escaped the notice of Darren Huston, chief executive of Booking.com.
“It’s annoying,” he told an audience at ITB Berlin this week. Hilton’s “stop clicking around” TV ad was shown for reference.
His response was hardly a surprise and presented in a tongue-in-cheek way (“I was at a chain hotel the other week and the wifi password was ‘book direct’, as if that would persuade me). But there was a steely resolve beneath the soundbite.
“We see them as business partners, and we’ve brought them lots of business they wouldn’t have had.”
Finding that demand cost booking.com $2.8 billion in marketing in 2015.
Huston also pointed out that only 2% of Booking.com customers stay at the same hotel twice, meaning that branded hotels are able to attract new customers through booking.com.
And there was more. “I don’t think the hotels should be telling customers how to use the internet. It like me saying don’t use Google. The customers will decide,” he said.
Interviewer Philip Wolf raised another elephant in the booking.com room, namely, vacation rentals.
Huston shied away from telling the audience why Priceline Group didn’t buy HomeAway, but acknowledged that vacation rental is the hardest accommodation vertical to get right, “harder than hostels, harder than BnBs,” and that “a lower friction model” was needed.
But “in five years booking vacation rental will be as easy as booking a Marriott in New York,” he believes.
B2B is increasingly part of the Booking.com story. Huston talked about its Booking Suite as “not a big money maker but a great way to build relationships with partners.”
OpenTable got an honorary mention – Priceline Group’s relatively under-the-radar $2.6bn play to get into restaurant reservations.
“We bought it not because of what it was but what it could be. It’s been a challenge to globalise it, but we should be there by the summer.”
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