We see numerous ads on TV from companies such as Trivago all claiming they can get you the cheapest accommodation deals. They claim to search hundreds of web site and thousands of accommodation providers to hunt down the best prices.
Firstly, although they look at hundreds if not thousands of website they only look at the prices offered by Internet booking agencies, they rarely check the prices offered by booking direct with an accommodation property.
Secondly even though there are hundreds of different of different booking sites on the internet they are nearly all owned by two giant American companies, Expedia owns more than 200 travel booking websites in more than 75 countries including Wotif.com.au, Expedia.com, Hotels.com, Hotwire.com, Trivago, Travel.com.au,Venere.com, Travelocity, Orbitz, and HomeAway
while the Priceline group own Agoda.com, Booking.com, Kayak.com, Priceline.com, villas.com, littlehotelier.com plus controls dozen of other brands through what they describe as strategic partnerships.
So in reality when you use site such Trivago ( or the Kayak) you are only getting prices from two companies ( or one of their subsidiaries)
Therefore the question on whether they offer the cheapest price is debatable, in one sense they do show the prices from a variety of booking agencies and the user can choose the cheapest advertised price but in the vast majority of cases you can get a cheaper price by contacting the accommodation provider directly. The video below is worth watching if you want to find out more .
Getting The Best Accommodation Deals
ABC’s program “The Checkout" recently did a very entertaining story on the role played by On-Line accomodation booking companies, in particular the large commissions charged by the two international giants, Booking.com and Expedia. The program gave a very clear picture of how these booking companies work and exposed some of the myths about pricing. The Checkout revealed they were able to save on average about 25% by booking direct with individual properties.
For years we have been told “by the booking companies” they have the cheapest prices and no one has come out and disputed their claims with the result that most people now believe their claims.
The report done by “The Checkout” goes a long way in addressing this misconception and the suggestions contained in the show should help travellers make significant savings when booking accommodation.
What “The Checkout” failed to mention was how they obtained their direct booking discounts and who they contacted, and we offer these suggestions on how you can get similar savings.
1. Firstly not all properties will offer a discount for booking direct, as many large accommodation businesses usually have fixed prices and the person answering the phone may not have the authority to offer you a discount, but it is always worth mentioning that you are booking direct. Simply ask the question “ I see your rooms are listed on Booking.com for $XX per night - can you offer me a discount if I book direct with you?”
2/ Smaller motels/hotels are more likely to offer a discount but you still have to ask the question,”can you offer me a discount if I book direct with you? and you should know what they are charging on other booking sites as it is not uncommon for owners to say they are offering you a discount when they are actually quoting you the same price as their on-line price.
Lastly, booking direct will help Australia’s accommodation industry. The current duopoly now controls over 85% of the countries on line accommodation and being oversea owned means they take their profits out of the country and do precious little in return to promote Australian tourism
Over the last decade the Internet has dramatically changed many aspects of the tourism and accommodation industry, in particular the vast majority of all reservations are now made through the Internet. While booking accommodation on the Internet is quick and convenient, there is a downside to this, with two giant American companies now controlling something like 90% of all online bookings made in Australia, whether you are booking a motel in the Grampians or an apartment in Warrnambool these two companies control most of the market. They are, Booking.com (who also own Agoda and Kayak) and Expedia ( who own Wotif,Trivago, hotels.com and Venere amongst others) and they now dominate the Australian market. They make their income by charging between 12% and 20% commission on all booking made through their web sites. This has proved to be a very clever strategy as they don’t have to own or control any accommodation business, but are able to take a sizeable percentage of the profit made by the industry - 12% to 20% commission on the total amount of a booking, probably represents between 30% and 40% of the businesses profit.