eDistribution Hotel Strategies

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eDistribution Hotel Strategies
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Help hotels and other travel suppliers improve
revenue from electronic distribution channels.
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Meeting Hotels Needs
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Putting it all Together
To Improve Performance in Electronic Channels
Services
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Why the Focus on Electronic Channels?
Expected to deliver over 26 billion in room
revenue in 2005
2005 Hotel Revenue Forecast (Billions)
Travel Agent GDS 12.4 B
Retail/Net Rate/Opaque Third Party Web
Sites 5.9 B
Web Direct to Property/Chain Sites 7.8 B
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Hotel e-commerce is becoming increasingly
important for the hospitality industry

• CRO distribution continued to shift in 2004
  toward the more cost-efficient electronic
  channels

Based on TravelCLICKs eTRAK Industry Report for
2004
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The Worlds Largest e-Commerce Marketplace

• Global Distribution Systems began in the early
  1980s
• Over 250 billion of travel sold through these
  systems
• Largest e-commerce marketplace, far surpassing
  total business transacted on the Internet
• Originate about 700 million inbound travelers a
  year worldwide

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12.1 USD Billion GDS Marketplace
GDS Hotel Booking Revenue Increased by 14.3 in
2004
GDS Hotel Bookings
Source TravelCLICKs Proprietary Database
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Consumer Online Spending - Hotels
Internet channels are still growingly rapidly,
and have become relevant
TravelCLICK estimates that six out of ten
households now consult the Web for travel
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Internet Use on the Rise

• Consumer utilization of the Internet to plan some
  aspect of a trip continues to rise

YPBR/Yankelovich Partners 2004 National Leisure
Travel Monitor
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Lookers to Bookers

• The rate at which consumers are using the
  Internet to book travel services is growing even
  faster

YPBR/Yankelovich Partners 2004 National Leisure
Travel Monitor
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Importance of e-Commerce Bookings of
Contribution to Rooms Revenue
Typical North American Hotels
Downtown Property
10-15
CRO Voice
4-10
Internet
Property Direct
GDS
47-65
20-30
Internet revenue consist of revenue contributed
by chain website, as well as internet retail
sites. Property direct channel is comprised
primarily by group business, but also includes
revenue from calls made directly to the property,
the propertys own web site and walk-ins.
Source Business mix derived from samples of
TravelCLICKs database and other market
information
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Importance of e-Commerce Bookings of
Contribution to Rooms Revenue
Typical North American Hotels
Resort Property
12-20
CRO Voice
7-14
Internet
Property Direct
GDS
5-15
51-75
Internet revenue consist of revenue contributed
by chain website, as well as internet retail
sites. Property direct channel is comprised
primarily by group business, but also includes
revenue from calls made directly to the property,
the propertys own web site and walk-ins. Source
Business mix derived from samples of
TravelCLICKs database and other market
information
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Data Solutions

• For managing performance and competitive
  benchmarking in electronic channels

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GM VIEW Summarizes Pricing, Rate Parity, Best
Rate GTD
Identify dates with increasing demand in advance
Isolate dates where pricing is out-of-sync with
the competition
Monitor best rate guarantee program and rate
parity
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Quick VIEW - Simple One-Page View of Competitive
Market

• Displays the lowest overall rate across all
  channels, enabling users to quickly gauge
  cross-channel competitive positioning
• Shows a complete picture of pricing by channel
  for auditing purposes.
• Easily identifies both rate parity problems as
  well as failures to meet best rate guarantee
  programs

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Daily VIEW A complete daily picture for all
channels and competitors

Users define Price Watch criteria that will
generate visual indicators when pricing for a
competitor is higher or lower than an acceptable
variance.
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Multiple Length of Stay VIEW One page view of
multiple LOS
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Channel VIEW A more detailed view of pricing by
channel
If a price has changed from the previous week,
the amount of the variance is printed in blue or
yellow font below the current price.
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Supporting Detail Provides rate descriptions
from each site
Identifies Merchant and Retail Rates
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Corporate RateVIEW
Group properties together by area, region or brand
Diagnostic alerts help manage rate parity
across each property
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Competitive Benchmarking
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GM Summary

• An overview of Market Penetration Performance

Know your hotels rank and market penetration for
the current period vs. prior year in a glance.
Identify top performing agencies in your market
for future sales opportunities.
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Performance Summary Key Measures by GDS

• Monitor market share and penetration by GDS
  compared to prior year

Choose monthly or year-to-date data
Visual alerts indicate when your market
penetration is less than 100.
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Performance Summary Key Measures of Electronic
Distribution

• Understand 12-month market penetration and
  average rate trends

Compare ADR trends vs. competitive set and
identify opportunities for growth.
Evaluate trend of market penetration for room
nights and revenue.
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Distribution Summary Account Performance in Your
Market

• Subscribers may request up to 150 total agencies

View monthly and year-to-date information
Totals appear at top for easy viewing
Identify which travel agencies book your hotel
and your competition, identify target accounts to
solicit for business opportunities.
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Distribution Summary Top Producing Cities and
Countries
Select competitors top cities and countries
View monthly and year-to-date information
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Revenue Management Summary
Lead Time Statistics identify booking patterns at
your hotel and the competitive set.
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Revenue Management Summary
Lead Time Statistics identify booking patterns at
your hotel and the competitive set.
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Revenue Management Summary
Understand customer stay patterns in your market
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• A platform from where hoteliers can manage
  inventory and rates across multiple retail and
  merchant sites

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Channel Manager Coverage

• The top sites (and their affiliates) capture ¾
  of the total on-line visits

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Travelocity.com, WorldRes and iHotelier to be
added by June 2004
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The Way It Works Today
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The Way It Will Work with Channel Manager
Manual Input into ONE Location New Rates
Inventory
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ChannelManagers Economic Value
Whats the value of CHM to this hotel?

• 50k salary x 20 of the RMs time 833
• 250 room hotel _at_ 70 occupancy _at_175 ADR
• generates 918,759 in revenue a 2 increase due
  to better
• Revenue Management would yield incremental
  revenues of 18,375
• 4 Suites per month (incremental) _at_ 200 (2 night
  stays) 1,600
• 3 new sites to the distribution portfolio
• 4 reservations from each site _at_ 150 (2 night
  stays) 3,600

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24,408 per month
292,896 incremental revenues per year
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Electronic Marketing

• For increasing business in electronic channels

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Travel Agency Media Network
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An Increasingly Complex Maze
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We Focus on the Two Most Profitable Channels
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Our Travel Agency Media Network
Reaches 87 of all Travel Agents worldwide Over
640,000 Terminals
Number of terminals worldwide
Sabre/Abacus 218,094 Galileo 158,917 Worldspan
52,297 Amadeus 211,809
Statistics provided by each GDS
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Independent Research Shows GDS Media
Significantly Outperforms Other Media Options
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Source NFO Plog Agent Survey 6/03
Source Hilton Agent Survey 8/03.
Traditional media response rates Direct
mail 3.0 Print ads 0.2
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Ad Serving How Does it Work?

• Ad serving is the process of dynamically
  delivering targeted electronic advertisements
  (i.e. serving ads) into a variety of electronic
  mediums.
• An ad server houses an advertisement and delivers
  it when the parameters for that particular ad are
  met.

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GDS MarketingOne to One Real Time Targeting

• Targets
• Ad Period
• Promo Period
• Point-of-sale Option

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First Screen Exposure- Hotel Availability
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Detail Screen Display
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Targeting Capabilities
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Consumer Media Network
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Our Consumer Network
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Results Page
Banners Badge ads are available on the Results
Page
2 Skyscraper ads are available on the Results Page
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Landing Page
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Hotel Detail / Show All Rates Page
Skyscraper ads are available on the Hotel Detail
Page and Show All Rates Page
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Destination Page Advertising
Page Sponsorship
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Destination-specific banners are available on
hotel, air, car and package research result
screens
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Banner Badge ads are available on Deals
Destination pages
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Customer Reach
Potential Customers Reached Through 20K
Expenditure
Daily Newspaper
Travel Trade Print
Direct Mail
TravelCLICK Media