As 2018 begins, Google Hotel Ads is poised to have a major impact on the hospitality industry over the coming year as well as in the years beyond.
For the uninitiated, Google Hotel Ads showcases hotels on Google.com and Google Maps, so that users can view it and easily find it across desktops, tables and mobile devices, basically anything they use to access the Internet for information about hospitality properties. The idea is that travelers will use these platforms to encounter and view hotel ads when they are actively looking to book a hotel, and that the hotel owners and operators will only be asked to pay when the ad generates a click through or a conversation.
It’s a simple concept that Google has been employing with ads in various industries for years. In 2018, however, the company will create a combination of these ads with new loyalty member acquisition opportunities, boosting the value of the concept even further for major hotel brands and chains. Traditionally, the agreements between hotels and online travel agency partners have obligated the hotels to maintain a room rate parity on online travel agency and other channels, including their very own branded websites. This is not the case throughout the globe, as governments in Europe have largely banned these types of rate parity agreements, but in the United States the arrangements are still technically legal.
The reason this is poised to change in 2018 is that the bigger hotel brands have now renegotiated terms in order to give themselves more flexibility to advertise the type of specialized, member-only booking offers that many experts say are paramount to staving off the threats to the business that have been posed by upstart home booking websites, the biggest of which is Airbnb, which has swept the globe and caused an increasing amount of concern among traditional hotel properties.
While it doesn’t appear at the moment that hotels can offer these lower rates outright, at least not publicly, experts say that some hotels have begun to experiment with a host of different book-direct incentives in order to entice users to click through, with an eye of course to upping their conversation rates.