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Published byJulius Kennedy Modified over 9 years ago
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“The New Normal for Distribution Channel Management”
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Our expert panel Carrie Campbell, Director of Lodging, D.K. Shifflet & Associates Richard Chambers, President, TravelCLICKinteractive Bill Peters, Vice President of Reservations, Outrigger Hotels & Resorts Jim Young, Senior Vice President, Global Distribution, InterContinental Hotels & Resorts
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Today’s agenda Quick overview of the new landscape
Recent findings of consumers trends in online arena Expert panel to comment on those trends Summary of recommendations for channel management Q&A from you
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Background Continuing Internet growth and influence Economy recovering
Intermediaries consolidating/evolving Chains taking action . . . challenges remain!
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Internet Hotel – U.S. Growth & Share Mix Hotel Revenue ’ ‘04 13% %
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The Internet – U.S. Growth & Consolidation
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Consumer Use of the Internet
Half of online travelers look online but book offline. Source: PhoCusWright,2003 Online Traveler Survey
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The Economy An improving economy is a necessary condition for hospitality financial improvement: Improves occupancy Provides negotiation leverage Sets the stage for raising ADR
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Hospitality Forecast Total US Occupancy Percent
Source: Smith Travel Research
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Declining Travel Agent Role
Agency Revenue ($b)
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GDS Changing Roles Conglomerate Component vs. Distribution Core
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Mega Players in the Game
InterActiveCorp Expedia HRN (Hotels.com) Travelscape Hotwire TripAdvisor Ticketmaster Vacation spot.com Interval International Lending Tree Match.com WizCom Trust Galileo Cheap Tickets.com Trip.com RCI Hotels Avis/Budget Rezoultions/Anasazi Thisco Utell ASP-PMS TravelWEb.com
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Biggest Player you may have never heard of Liberty Media Corporation
20% of InterActiveCorp 4% AOL Time Warner 3% Cendant Corporation 55% On Command 100% Starz 42% QVC 50% Discovery Communications (Travel Channel included here) 29% Sky Sports 1,2,3 56% DMX Music 30% the Wireless Group 89% True Position, Inc
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Orbitz and Priceline, Give me no lifeline
Where all my business is, no one can tell The .Com's are booking, My RevPar is looking Like someone has shot it right straight to hell Wasting away again in Merchant Modelville Hoping for some …some rooms to be bought Some people claim, that the web is to blame But I know, it’s my own damn fault
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The Major Sites 3 Hotel Companies 20.13 B Top 3 “3rd Parties” 28.21 B
Prices as of noon April 2, 2004
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Chain Response Chain distribution focus: Web site
Direct connect Best rate guarantee Portal strategy Intermediary negotiations Property level support: Strategy – Pricing & Distribution Systems
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Key Issues Intense competition for . . . Guest eye share
Guest allegiance & market share Price and inventory control Creates opportunities for resorts!
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“The New Normal for Distribution Channel Management” Carrie Campbell Lodging Group Director D.K. Shifflet & Associates, Ltd.
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The New Normal: (Overview)
We all know distribution has changed Room Night/Revenue Share Who Using the Internet? How Do We Rate?
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We All Know Distribution Has Changed:
Hotels Resorts D.K. Shifflet & Assoc. Ltd. (Total Room Nights)
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Share of Nights ≠ Share of Revenue
Hotels D.K. Shifflet & Assoc. Ltd.
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Share of Nights ≠ Share of Revenue
Resorts D.K. Shifflet & Assoc. Ltd.
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Bargain Hunting #1 Use of Internet
D.K. Shifflet & Assoc. Ltd.
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Who Are These People? Resort Website Other Website
All Other Res. Channels Male 56% 46% 53% Female 44% 54% 48% Married 68% 67% 71% Mean Age 43.5 years 41.7 years 48.0 years Mean HHI $90,700 $78,200 $80,200 Att./Grad. College 70% 77% 69% Emp. Full Time 76% 80% Prof./Mgr 47% 38% D.K. Shifflet & Assoc. Ltd.
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And Why Should I Care About Them?
Resort Website Other Website All Other Res. Channels Avg. # of Trips 4.3 3.3 3.9 Ave LOS 3.1 3.0 2.8 ADR $125 $113 $120 Avg. Total Bill $379 $344 $314 D.K. Shifflet & Assoc. Ltd.
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Guests Are Getting What They Pay For…
D.K. Shifflet & Assoc. Ltd.
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Summary Most Internet room nights at expense of higher ADR channels
Guests Through Your Website Travel More Stay Longer Spend More Not all guest experiences are equal In the long run, that will hurt you D.K. Shifflet & Assoc. Ltd.
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Our expert panel Carrie Campbell, Director of Lodging, D.K. Shifflet & Associates Richard Chambers, President, TravelCLICKinteractive Bill Peters, Vice President of Reservations, Outrigger Hotels & Resorts Jim Young, Senior Vice President, Global Distribution, InterContinental Hotels & Resorts
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Wrap up: Best Practices for Local Internet Marketing
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Topics Functional Website Design Search Marketing
Reservations Processing
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Place the booking engine on the home page
Conversion rates increase dramatically with less ‘click-throughs’.
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Email Capture on Home Page
Like the booking engine, acquiring addresses for future re-marketing is easier with less clicks
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Instill Confidence on the Site
Best Value or Best rate clear in the copy Keep the online consumer at your site rather than clicking to another site
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Search Marketing Bringing customers to your site
Need to have both organic and pay per click to optimize marketing plans
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Search Marketing Market your resort by business unit
Horizontal Marketing Approach
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Horizontal Strategy Accommodations Restaurants Meetings Golf Spa
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Reservations Processing
Conversion rates are higher with less clicks
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Traditional Booking Engine
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Summary Build Best Practices on the site Best Marketing Practices
Less clicks means more business Best Marketing Practices Search Engines Market by business unit
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