Friday, December 3, 2021
HomeTravel TechnologyAll (Hotel) Revenue Is Not Created Equal | By David Eisen –...

All (Hotel) Revenue Is Not Created Equal | By David Eisen – Hospitality Net

A dollar is a dollar; a euro is a euro; a quid is a quid; a yuan is a yuan; and, for the crypto crowd, a bitcoin is a bitcoin—right?

Wrong. At least when it comes to how hotels bring in revenue. In that case, all revenue is not created equally.

It’s a theme that was championed at a recent IHG Owners Association summit I attended. (I even took a photo of the slide as evidence.) It’s also one of the most pressing issues that has hamstrung the collective hotel industry’s ability to own its own business.

Problem Bookings

Despite its best efforts, hotels bookings aren’t always made directly with the hotel. In fact, online travel agencies—third-party booking sites, such as Expedia or Priceline—account for approximately half of all U.S. hotel bookings and they don’t come cheap. OTAs charge hotels per booking and that charge can be between 15% and 30%. Sell a room for $100, receive $85—and that’s before factoring in the costs…

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