With more guests checking in, hotel companies are handing online travel agencies fewer rooms to sell, making it more difficult to find discounts.
Room prices on sites such as Expedia, Orbitz and Priceline were on average $31, or 22 percent, lower than rates offered on hotel chain Web sites in the first quarter, according to the industry research firm Rubicon, which analyzes data supplied by Hilton, Hyatt, Marriott, Starwood, Gaylord and Intercontinental Hotels Group.
Those chains supplied travel Web sites with 9.1 percent of their inventory last quarter, down a little less than 1 percent year over year, but a marked difference from 14 percent in 2009.
The online travel sites “are the only [distribution] channel that saw a decline in the volume of business they get from hotels,” said Tim Hart, executive vice president and head of business intelligence for Travelclick, Rubicon’s parent company.
The decline comes at a time when hotel operators are raising average daily rates. Smith Travel Research said rates crept up an average of 3.1 percent to $99.37 last quarter. Locally, average daily rates trended up 2.7 percent to $145.45. Even at a discount, the price of hotel rooms on travel sites climbed 4 percent in the first three months compared to a year earlier.
For business travelers, who typically book through traditional agents, Expedia and Priceline’s inventory is of little consequence. For the average consumer, however, the discounts offered by these sites could mean more.
Hotel operators have long had an uneasy relationship with online travel companies. In the dark days of the downturn, many upped their use of these agents, forking over an average 25 percent in commission, in a desperate bid to fill rooms. Now that business is rebounding, operators are debating the value of those relationships.
“Different channels serve different needs and market conditions,” said Larraine Voll Morris, vice president of electronic distribution at Bethesda-based Marriott, in an e-mail. “We continue to leverage [online travel sites] in very strategic ways to optimize and not to maximize sales.”
Sales at Marriott, which operates 3,600 hotels in 71 countries, grew 5.6 percent to $2.7 billion in the first quarter, though the numbers fell short of analysts’ expectations. The company selectively began raising rates last year, before any meaningful pickup in travel, a gamble that paid off as rooms began to fill in the summer.
Marriott has consistently enhanced the booking capabilities of its own Web site, but Morris said the company has no intention of ending its relationship with third-party sites.
“Our overall relationships with [the sites] are good,” she said. “At the end of the day, we understand the importance and role one another plays to the consumer and marketplace, which serves as important middle ground for both of us.”