HOSPITALITY CADENCE NEWS
Daniel P. Kipping
CCO Revzers || Sales & Commercial Specialist Partner inPerto || Business Mentor || Hotel Business Optimizer || Startup'er || * Helping hospitality companies realizing and capitalizing on its full potential *
“EU Commission submits Statement of Objections to Booking regarding the planned acquisition of eTraveli.”
The European Commission has informed Booking Holdings ("Booking") of its preliminary view that the planned acquisition of Flugo Group Holdings AB ("eTraveli") could enable Booking to strengthen its position in the market for online hotel booking services in the European Economic Area ("EEA").
Both Booking and eTraveli provide online travel agency services, with Booking primarily focusing on hotels and eTraveli mainly facilitating flight bookings. Additionally, Booking operates in the meta-search services market primarily through its price comparison platform, KAYAK.
Communication of the Statement of Objections
On November 16, 2022, the Commission initiated an in-depth investigation to examine whether Booking's acquisition of eTraveli could strengthen Booking's position in the market for online hotel booking services in the EEA.
As part of this investigation, aimed at obtaining insights into the potential effects of the acquisition, the Commission analyzed internal documents from the involved companies and sought information and opinions from competing online travel agencies and hotels.
The Commission has preliminarily concluded that Booking is the dominant online hotel booking intermediary in the EEA. The Commission is concerned that the merger could:
Strengthen Booking's dominant position in the market for online hotel booking services, improve its bargaining power with hotels, and potentially reduce the demand covered by cheaper alternative distribution channels, given the already limited competition in the online hotel booking services market, and apparent absence of pressure on Booking from competing online travel agencies, hotels, or end customers.
Enable Booking to expand its ecosystem for travel services (such as flights, accommodations, car rentals, and attractions), making it more difficult for other companies to challenge its position in the online hotel booking market.
Result in higher barriers to market entry and expansion, as it would become more challenging for competing online travel agencies to establish a sufficient customer base for online hotel booking services.
Allow Booking to significantly increase its customer frequency, thereby potentially increasing its revenue in the online hotel booking sector.
Lead to higher costs for hotels and potentially end customers.
Companies and Products
Based in the USA, Booking operates in the market for online travel agencies with brands such as Booking.com, Rentalcars, Priceline, and Agoda. In the EEA, Booking primarily operates in online accommodation booking under the Booking.com brand and provides limited online flight booking services sourced from eTraveli. Through its division KAYAK, Booking also offers meta-search services for accommodations, car rentals, and flights under brands like KAYAK, Momondo, Cheapflights, and HotelsCombined. Furthermore, Booking provides certain competing online travel agencies, which do not offer such services themselves, access to its online accommodation booking services through commercial partnership programs.
Based in Sweden, eTraveli operates an online travel agency through its brands GotoGate, My Trip, Seat24, and SuperSaver, primarily facilitating flight bookings. It also operates a flight meta-search service under the Flygresor brand, primarily in Sweden, which will remain with eTraveli and is thus not part of the acquisition.
Background
By communicating the Statement of Objections, the Commission formally informs the parties in writing of its concerns regarding potential violations of competition law. This communication does not prejudge the outcome of the procedure. Booking now has the opportunity to respond, examine the Commission's case file, and request an oral hearing.
The proposed acquisition was notified to the Commission on October 10, 2022. On November 16, 2022, the Commission initiated an in-depth investigation and is now required to make a final decision by August 30, 2023.
The Commission's task is to examine mergers and acquisitions of companies whose turnover exceeds certain thresholds (see Article 1 of the Merger Control Regulation) and to prohibit mergers that would significantly impede effective competition in the entire EEA or in a substantial
?“The STR Hospitality Industry Sentiment survey reveals upward trends in group demand”
In an ever-changing hospitality landscape, it is crucial for industry professionals to stay informed about the latest trends and sentiment within the sector. STR, a leading provider of data benchmarking, analytics, and marketplace insights, launched the Hospitality Industry Sentiment (HIS) survey to provide valuable insights into the opinions and experiences of travel industry professionals. With the completion of the second edition of the survey in Q1 2023, we can now delve into the subtly shifting landscape and emerging trends that impact the industry.
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Shifting Landscape of Leisure and Group Demand:
The HIS survey reveals a relative decline in the strength of post-pandemic leisure demand between the first and second iterations. However, this decline is offset by an upward trend in group demand. Hoteliers can find solace in the fact that group travel is steadily recovering and contributing positively to their businesses. Additionally, the survey indicates a growing strength in internal travel, indicating that people are exploring domestic destinations more frequently.
Surges in Demand due to Major Events:
While respondents reported a decrease in the boost from "increased guest spending," a significant lift was noted for "major events." This finding suggests that destinations hosting major events experience substantial demand surges, presenting a valuable opportunity for hoteliers. By capitalizing on these events, hotels can attract more visitors and generate increased revenue.
Regional Variations in Business Confidence:
The HIS survey highlights regional variations in the forward-looking trend of general business confidence. Respondents from the United Kingdom displayed the most pessimism in the short term. However, they expressed increasing hope for the future of the industry, particularly when looking ahead 24 months. In contrast, confidence among Canada and Asia-based respondents showed slight growth as the timeline extended. Conversely, European respondents displayed declining confidence when looking further into the future. In the United States, confidence faltered slightly in the mid-term (12 months ahead), but the majority of respondents remained solidly confident when looking two years into the future.
The Hospitality Industry Sentiment survey conducted by STR provides crucial insights into the ever-evolving hospitality landscape. The second edition of the survey reveals valuable trends and shifting sentiment within the industry. While leisure demand experienced a slight decline, group demand and internal travel are trending upward, contributing positively to hotel businesses. Major events continue to be a significant driver of demand. Regional variations in business confidence highlight the importance of considering geographical nuances when strategizing for the future. By staying informed and adapting to these trends, hospitality professionals can make informed decisions to thrive in the post-pandemic world.
“Unraveling the Mysteries of Sales Productivity and ROI in the Hotel Industry”
Step into the dimly lit room where hotel professionals gathered for an extraordinary virtual gathering of minds. Executives from various hotel management companies, armed with their expertise, embarked on a quest to explore the enigmatic realm of sales productivity and return on investment (ROI). As the HSMAI Hotel Management Company Sales & Marketing Executive Roundtable commenced, a palpable sense of anticipation filled the air.
Like seasoned detectives, these professionals dissected findings from the latest research survey, using them as valuable clues to unlock the secrets behind sales productivity. The expectation for ROI was a puzzle they tackled head-on. The survey revealed intriguing results, with on-property sales managers aiming for a ratio of 11-12:1, while catering managers targeted a slightly lower range of <10-12:1. However, they understood that each hotel company had its own distinct circumstances, and thus, the calculation of ROI demanded a customized approach.
The investigation led them deeper into the labyrinth of ROI formulas, a realm fraught with complexity. Market segments, average daily rates, business travel, group contracts, catering, and room rentals—each variable adding a layer of intricacy to the calculations. It was an intricate dance between precision and adaptability, considering the diverse nature of hotel companies and the distinct dynamics within different sales roles.
A hidden truth emerged, shining a light on a subject seldom discussed—the rise of remote sales managers. The conversation ignited contrasting opinions. Some believed that these enigmatic figures thrived in their roles, benefiting from fewer interruptions. However, others revealed tales of resistance from operators and general managers, reluctant to embrace this modern paradigm. The hybrid model, blending the best of remote and on-site sales teams, emerged as a promising solution in this clash of opinions.
As the investigation reached its climax, five best practices emerged as guiding principles for cracking the code of sales productivity and ROI. The first called for a relentless pursuit of improved sales productivity, followed by a quest for efficiency and effectiveness in sales processes. Another critical clue revealed the significance of accounting for turnover within the sales team, necessitating goal-setting adjustments throughout the year. Lead qualifying and response times emerged as a crucial puzzle piece, demanding effective qualification processes to manage the influx of leads and extended response times. Additionally, the investigators discovered the need for market-specific ROI calculations, recognizing the ebb and flow of demand within each hotel and market. Finally, they unraveled the secret to success—a flexibility in goal-setting, allowing for adaptation based on ever-changing market conditions and demands.
In the end, armed with these newfound insights and best practices, the hotel professionals departed the virtual roundtable with renewed determination. They understood that the path to improved sales productivity and ROI lay before them, ready to be conquered. The mysteries of the hotel industry, once cloaked in darkness, were illuminated by the collective wisdom and shared experiences of these detective-like minds.
As the credits rolled, the hotel professionals extended their gratitude to Kalibri Labs for sponsoring this illuminating roundtable. They acknowledged the participants, a remarkable group of companies, including Aimbridge Hospitality, Crescent Hotels and Resorts, First Hospitality, Kessler Collection, Peachtree Hospitality Management, and many others. Together, they had embarked on a journey, weaving a tapestry of knowledge and propelling the hotel industry forward into a new era of sales excellence.
(Article originally appeared on HSMAI.)