Business travelers going rogue

Business travelers going rogue

SHERMAN, Connecticut—U.S. business travelers have more control of their own bookings than ever before, which means hoteliers should think outside of corporate travel policies and consider the end user, according to PhoCusWright research.

“You have to think of them as free agents,” said Carroll Rheem, director of research, during a webinar titled, “The U.S. Business Traveler: Managed, Unmanaged and Rogue.”

Carroll Rheem

Whereas the focus in the past rested primarily on travel managers because they were the decision makers, today hoteliers must place greater emphasis on the travelers themselves, she said.

For one thing, unmanaged business travelers—those who aren’t constrained by a corporate travel manager—make up approximately 70% of the market, Rheem said, citing numbers from a recent special project PhoCusWright conducted.

For another, most business travelers lack a travel planning routine, which suggests hoteliers have an opportunity to provide a better booking platform to capture market share, she said.

Only 29% of business travelers have a booking routine. “Even among the managed group the response is only 32%,” Rheem said. “… This says there are a lot of opportunities for new development and openness to trying new business models and trying new features. It also says to me there are a lot of problems to be solved.”

Going rogueRheem focused on several travel segments during the webinar, including hotel, air and car rental.

“Ultimately, hotel is the area where we see the most rogue behavior (with managed travelers),” she said.

“When you’re in the decision-making process, there are two kinds of scenarios that really drive rogue behavior: Sometimes there are just too many options. … And other times there are just not enough options for you, especially in that mid-range company that doesn’t have a very comprehensive policy.”

The top driver of rogue behavior, however, is convenience, cited by 47% of respondents to PhoCusWright’s study.

Price also is an influential driver, cited by 30% of travelers.

“Also, loyalty programs are a pretty significant driver,” Rheem said. “One in five road travelers say they accumulate miles or status from a brand that’s outside of company policy. Those points are sticky, and business travelers love those points.”

Booking behaviorSeven of 10 unmanaged business travelers said they used online travel agencies when researching travel. Websites for travel providers themselves (e.g., brand.com) was the second most popular, cited by 61% of unmanaged respondent.

When it came to actually making bookings, however, unmanaged business travelers (53%) were more inclined to book at brand.com than an OTA (50%).

“The hotel brand websites coming out on top is not necessarily what you would expect to see,” Rheem said. “… OTAs were far ahead of supplier websites when it came to shopping. But when it comes to booking, a lot of these savvy business travelers are doing the flip. …

“The savvy business travel is often making that switch often specifically for hotel websites because of points,” she said.

Other findingsRheem highlighted several other findings from her research during the webinar.

• 39% of managed travelers mix business travel with leisure travel; unmanaged travelers number slightly more than half.
• 30% of business travelers said Web-based presentation and video conference tools did not impact their travel plans. Of the remaining respondents, 25% said the tools impacted plans “very little,” while 30% said “somewhat.” Only 2% said the tools impact plans “dramatically.”
• A “good website experience” trumped price when using particular websites to research travel.

Retrieved from http://www.hotelnewsnow.com/Articles.aspx/7947/Business-travelers-going-rogue

Definition of Nostalgia

[Definition of Nostalgia]

1.A bittersweet longing for things, persons, or situations of the past.
2.The condition of being homesick; homesickness.

from. The American Heritage(r) Dictionary

---

According to the definition, the nostalgia is not a sense of simple pleasure, but a pain and a feeling of yearning.
Why do people want to see or memorize the old fashion or destination again?
That is the my question now.

Global Research Reports - Research Analytics - Thomson Reuters

Global Research Reports - Research Analytics - Thomson Reuters

Aging Report 2009, 노령화 보고서 2009

Number of persons aged 60 or over

In 2009, an estimated 737 million persons were aged 60 years or over and constituted the “older population” of the world, nearly two thirds of whom lived in developing countries. Their number is projected to increase to 2 billion in 2050, by which time older persons will outnumber children (persons aged 0 to 14 years). Today, more than half of the older population lives in Asia (54 per cent) and a fifth lives in Europe (21 per cent).

Population aged 60 or over as a percentage of the total population

Today, one out of every nine persons in the world is aged 60 or over. By 2050, the United Nations Population Division projects that one person out of every five will be aged 60 or over. The percentage of older persons is currently higher in developed countries. In Europe, one in every five persons is already aged 60 or over.  The equivalent proportions are one in ten in Asia and in Latin America and the Caribbean, and one in 19 in Africa. However, population ageing is advancing faster in developing countries than in developed countries where population ageing is more advanced.

The oldest old

The older population is itself ageing. Currently, the oldest old (persons aged 80 years or over) constitute 14 per cent of the population aged 60 or over. The oldest old constitute one of the fastest growing segment of the population and, by 2050, 20 per cent of the older population will be aged 80 or over. The number of centenarians (persons aged 100 years or over) is growing even faster than the oldest old and is projected to increase nine-fold by 2050, from approximately 454,000 in 2009 to 4.1 million in 2050.

Life expectancy at age 60

The world has experienced dramatic increases in longevity. Globally, life expectancy at birth has gained more than 20 years since 1950, to reach its current level of 68 years. At current mortality rates, men surviving to age 60 can expect to live another 18 years and women surviving to age 60 can expect an additional 21 years of life. However, life expectancy at age 60 varies significantly across countries. In the least developed countries, men reaching age 60 can expect to live only 15 years more and women 17 years more, whereas in developed countries, life expectancy at age 60 is 20 years for men and 24 years for women.

Sex ratio

Because female life expectancy is greater than male life expectancy at every age, there are fewer older men than older women. In 2009, there were 83 men for every 100 women among those aged 60 or over and only 59 men for every 100 women among those aged 80 or over. The ratio of men to women at older ages is lower in developed countries (74 men per 100 women) than in developing countries (89 men per 100 women) because the differences in life expectancy between the sexes are larger in developed countries.

Percentage of older persons currently married

Older men are more likely than older women to still be married because women marry younger than men do and the incidence of widowhood is higher among women than among men. In addition, men are more likely to remarry after widowhood or divorce than women are. Globally, about 80 per cent of older men are still married, compared to only 48 per cent of older women. Sex differences in the proportion married are more marked in the least developed countries, where the age difference between spouses is higher and most older persons who do not have spouses are widowed.

Percentage of older persons living alone

Although many older persons who live alone are socially active and have adequate means to support themselves, living alone is a marker of vulnerability, especially in cases of illness or disability, and is associated with a greater risk of social isolation and poverty. An estimated 14 per cent of the world’s older persons live alone. The proportion is lower for men (9 per cent) than for women (19 per cent) because women are more likely to be widowed. However, among persons who do not have spouses, men are more likely than women to live alone. The proportion of older persons living alone is lower in developing countries (8 per cent) than in developed countries (24 per cent).

Old-age support ratio

The old-age support ratio is the number of persons aged 15 to 64 per person aged 65 years or over. It is an indicator of demographic ageing and of the degree of dependency of older persons on potential workers. The old-age support ratio fell from 12 persons aged 15 to 64 for every person aged 65 or over in 1950 to 9 in 2009 and is projected to fall to 4 persons of working age per person aged 65 or over in 2050. The level of the old-age support ratio has important implications for the solvency of social security systems (pensions and public health), as well as for the size of private transfers from the working-age population to older family members.

Statutory retirement age

In a majority of developed countries, men become eligible for full pension benefits at age 65 or higher while women become eligible below age 65. The statutory retirement age in developing countries ranges usually between 55 and 60 years for both men and women and tends to be lower than that in developed countries. The lower statutory retirement ages common in developing countries reflect their more incipient social security systems and their lower life expectancies.

Percentage of the older population in the labour force

Countries with high per capital; income tend to have lower labour-force participation rates among older persons. In developed countries, just 24 per cent of men aged 60 or over are economically active, whereas 47 per cent of older men are economically active in developing countries. Among older women, 14 per cent are economically active in developed countries but 24 per cent work in developing countries. Older persons in developing countries work until advanced ages because they are not covered by existing social security systems or because, even when covered, they receive relatively low pensions.

* United Nation (2009). Population Ageing and Development 2009

* Retrieved from http://www.un.org/esa/population/publications/ageing/ageing2009chart.pdf

The Definition of Boutique Hotels,부티크 호텔의 정의

The Definition of Boutique Hotels - Written By: Lucienne Anhar - HVS International

Since the beginning of the 21st century, the lodging industry has become increasingly over-supplied with big monopolies of hotel brands. These brands, predominantly based in North America, succeed in selling consistency across the nation and, for some, around the world. These lodging facilities publicize the meaning of "hotel" through the truly traditional definition: a lodging accommodation for travelers.

Nevertheless, travelers nowadays expect more than simply comfort and convenience. An increasing number of travelers prefer to be "surprised" — positively, needless to say. When planning trips, they seek properties that are noticeably different in look and feel from branded hotels. Although many travelers claim to seek lodging facilities that coincide with the traditional hotel concept, boutique hotels are becoming more and more of a social manipulation: those who do not stay in boutique hotels are categorized as unfashionable and un-hip.

Boutique hotels are believed to have been invented in the early 1980s. Two of the first boutique hotels in the world opened their doors to the public in 1981: The Blakes Hotel in South Kensington, London (designed by celebrity stylist Anouska Hempel) and the Bedford in Union Square, San Francisco (the first in a series of 34 boutique hotels currently operated under the flag of one of the most eminent players in the boutique hotel world today, the Kimpton Group). In 1984, Ian Schrager opened his first boutique hotel in Murray Hill in New York City: the Morgans Hotel, designed by French stylist Andrée Putnam.

The definition of a boutique hotel varies, especially among the hotel industry's primary players. However, the majority of boutique hotel operators, creators, and owners can all agree on the following primary features of boutique hotels:

Architecture and designStyle, distinction, warmth, and intimacy are key words in the architecture and design of boutique hotels, which seem to attract a niche of customers looking for a special and differentiated property able to fulfill their individual needs. Boutique hotels are not boxed into standards; the definition and expression of a theme is a crucial path to success.Many boutique hotels introduce different themes in each guestroom, making every single stay unique, even for their repeat guests. For example, the Library Hotel in New York City offers a different theme (from romance to music) in every guestroom. Many hotel owners are revitalizing older hotels, repositioning them as boutique properties. While true modernism and newly born design generally become "hip" in no time, it is usually those properties that succeed in combining historic details with chic elegance that outlast the fads.
ServiceThe question that blurs the meaning of boutique hotels is, "Does size matter?" Most boutique hotel "celebrities" insist that it does, and that boutique hotels are properties that do not exceed 150 rooms. They believe that what distinguishes boutique hotels from standardized hotels is the connection that hotel guests experience with members of the hotel staff. Most of these hotels impose the acknowledgment of guest names by all hotel staff members, an experience that is clearly difficult to achieve in a large-scale hotel.Nevertheless, Ian Schrager, founder and president of Ian Schrager Hotels, which currently comprises approximately 3,000 guestrooms in nine properties, is among those who do not believe in this commonly accepted facet of the typical boutique hotel. With creative people as his target market, he defines "boutique" as an approach and attitude, with no regard to hotel size. Personalized service does not appear to be important at Schrager properties, especially in his "biggies," such as the Paramount Hotel (594 rooms) and the Henry Hudson Hotel (821) rooms. Instead, Schrager hotels place the emphasis on entertaining their guests by creating a theatrical atmosphere that attracts all senses: through architecture, design, colors, lighting, art, and music.
Target MarketBoutique hotels generally target customers who are in their early 20s to mid-50s, with mid- to upper-income averages.
Although no standard definition of boutique hotels has been agreed upon, and the sizes of these types of hotels vary considerably, most boutique hotels do share some common characteristics. As with any other hospitality product, the success stories of boutique properties begin with fundamentals such as location, product quality, market demand, a clearly defined marketing approach, and effective distribution/reservations coverage. In light of these factors, boutique hotel creators detach their creations into two branches:

Boutique hotels in city destinationsIn city destinations, location still ranks number one on guests' priority lists. Good locations for boutique hotels are not determined only by manner of convenience, but also by the "trendiness" and "chic-ness" of their respective neighborhoods. Accordingly, most existing city boutique hotels are located in vivacious cities such as New York, London, San Francisco, and Miami. Ian Schrager, for example, claims to only open his hotels in cities with enough depth — i.e., big fashion and media capitals. Nevertheless, more and more companies are targeting less cosmopolitan cities that are believed to have strong potential for boutique hotels: cities with vibrant economies and high-end residential areas, but bland, characterless hotel inventories.Both the style and the design of city boutique hotels are unlike the traditional resort boutique hotels. Cooler notes, modernism, and the interpretation of the 21st Century — at times matched with historical components and art — are considered modish, and are found in most successful city boutique hotels. Technology strongly relates to these factors, whether it is technology that enhances the ambience and promotes emotional contact between the guests and the hard attributes of the building (such as lighting and music), or technology that is provided for the convenience of hotel guests (such as in-room DVD players, flat-screen television sets, cordless phones, and computers with high-speed Internet access and the latest monitor genres).Entertainment in boutique hotels is an important dynamic in creating a lively, chic and trendy mind-set. However, in the boutique hotel concept, entertainment is not limited to events such as live music and performances; the idea of a boutique hotel is entertainment in its own nature: a hip restaurant, lounge, and bar; an exceptional theme; and visually spectacular decorations.
Boutique hotels in resort destinationsBoutique hotels in resort destinations are exotic, small, and intimate. These boutique hotels give their guests a chance to explore the local feel without sacrificing luxury.Although location is just as important in resort destinations as it is in city destinations, the word "trendy" has a different designation in this matter; if location should be central in the case of city boutique hotels, trendy resort boutique hotels are generally well-hidden, tucked away in deserted corners of the islands or the mountains. The more difficult it is to reach the destination by means of common transportation, the more fashionable the location is considered.Successful boutique resort hotels unite traditional architecture with the comfort and luxury of modernism, without losing the personality of the local community. Each boutique hotel must develop its own recognizable flavor, with sumptuousness and excellence as the only similarities among boutique resort hotels. In boutique resort destinations, service is generally more important than it is in boutique city destinations. Exotic amenities take the role of technology in city destinations; in fact, boutique resort hotels actually promote the non-existence of electronics and communication devices in guestrooms as a competitive advantage. Traditional spas, rose petal baths, private individual plunge pools, honeymoon packages, and art and painting sessions are just a few examples of boutique amenities offered in resort destinations.
Marketing Boutique Hotels
Most guests stay in boutique hotels because it is fashionable to do so, not because of the facilities the hotels offer. In this regard, boutique hotels are being marketed in a manner that is similar to many other goods, where the experience and the image are sold, rather than the product itself. Marketing an independent boutique hotel can be difficult, as there are generally financial restrictions and other resource restrictions. The main issue in marketing a boutique hotel or resort involves "sending a message" to the target market. Story development is more important than ever, which relates back to the special nature of the experience or location, or the history behind the creation of the hotel. The unique and easily related story must then be delivered through effective and affordable channels such as direct mail or direct sales, allied group marketing, affinity group travel planners, and public relations through press.

Boutique hotels bring certain benefits in terms of operations and profitability. Besides strong customer demand, the economics are favorable for operators. For example, boutique owners do not have to pay a franchise fee to become part of a larger chain. The hotel can survive and succeed without such costly amenities as restaurants and ballrooms/meeting spaces; however, these amenities, when styled in a boutique manner, can bring significant additional profitability to the hotel's rooms revenue. Once established, boutique hotels also tend to have a higher percentage of repeat business compared to the industry in general, which may reflect a smaller degree of volatility when going through difficult economic times. Nevertheless, smart boutique hotels must continue to adapt to the incessantly changing needs, tastes, preferences, and fashions in order to remain competitive in the flourishing boutique hotel market.

Lucienne Anhar, Consulting & Valuation Analyst at HVS International.

* Retrieved from http://www.hospitalitynet.org/news/4010409.search?query=lucienne+anhar+boutique+hotel

[ Hospitality Net ] Over 50 and Ready to Rock, 50세 이상 인구가 세상을 흔들다

On January 1st, at precisely 12:01 a.m., the first baby boomer in America turned sixty years old, while the last one turned forty. In fact, more than half of the seventy-seven million Americans born between 1946 and 1964, dubbed the baby boomers, are now over the age of fifty.

What does this milestone mean for hoteliers? It means changing the language and messages that we have traditionally utilized in our efforts to connect with the 50-plus or so-called 'senior' market.

Boomers are shaking up the traditional ideas of aging and hoteliers must understand that the 'old' rules of marketing no longer apply. Today the words 'sexy', 'hip', and 'adventurous' are not reserved for the 'young' anymore.

Consumers age 50 and older now buy a quarter of the scooters Vespa sells in the US, and in response to a recent Business Week article entitled 'Love Those Boomers', a reader commented; 'Plenty of time, sufficient funds, ready to rock and 50 plus'. This is boomer mantra. They don't think of themselves as seniors and we shouldn't either.

They have plenty of money and are not afraid to spend it to fuel their active lifestyles; are ready, willing, and able to try new, even adventurous experiences; and bottom-line, they are the largest and most lucrative group of travel related consumers. We can't afford to ignore them, or their wants and needs.

In the coming year, boomers will earn an estimated $3 trillion in annual income, weld a discretionary spending power of $800 billion, and control eighty percent of all US financial assets. More importantly however, it is estimated that boomers spend forty percent more time vacationing and seventy four percent more money on a traditional vacation, than the 18-to 34-year-old set.

So how do we effectively market to America's most lucrative consumer? Here are some things to keep in mind, to help ensure that you get your fair share.

No labels please

This is not a group you want to call 'senior'. Don't try to classify or label boomers. It doesn't work. Some boomers are retiring early, while others are still working, perhaps even within a new start-up. Some are empty nesters, while others are just starting families. They are connected to people of all ages and are plugged into a variety of media outlets. Boomers have active social lives with a multitude of interests, and ultimately defy generalizations. Even now, at the age of 60, they still think you're talking about their parents when you use the word 'senior'.

It's never too late to learn

Boomers have a thirst for knowledge and actively pursue educational opportunities. Offer packages and programs that include courses in food preparation, wine tasting, gardening, foreign languages, historical tours, relationship management, sexuality, health management, relaxation techniques, or even financial management. Boomers lack many of the retirement benefits that their parents took for granted, so they are always seeking advice on how to better manage and make the most of their assets.

Still working on 'me'

Boomers pursue self-discovery, self-improvement, and reinvention opportunities. They are looking for the answers to their questions surrounding spirituality and while they are delving more deeply into their traditional faiths, they are also open to new ideas such as new age offerings or alternative religions. Maturing boomers are also in pursuit of physical fitness and desire exercise programs that include 'joint-friendly' fitness equipment, low-impact aerobics, and gentle yoga classes. Genuine relaxation programs and spa treatments are high priorities for boomers too. Reinvention can include make over sessions, co-branded events with plastic surgeons, or personal branding workshops. Boomers are not called the 'me' generation without reason.

Born To Be Wild

Like the song says, 'Looking for adventure, and whatever comes our way', boomers are explorers. They want exciting adventures and/or experiences, ones that will either take them off the beaten track to some exotic destination, or provide an unusual one-of-a-kind experience. Some want to test themselves while others just want bragging rights. Either way, it is important that you sell your property's attributes as exciting and adventurous. If you're located within an exotic destination, inspire boomers with words that paint the experience. If you're not, consider offering exclusive experiences like tickets to concerts or sporting events, bike or sports car shows, and celebrity weekends with golfers, authors, chefs or vintners. Take them outside for rock climbing, hang gliding, whitewater rafting, or sport fishing. Think creatively about how to make your hotel or resort more exciting and interesting.

Buzz is everything

Never forget that boomers invest in buzz. They want value for their most precious commodities, time and money, and word-of-mouth marketing is gospel. Their most important source of information is without a doubt their network of co-workers, friends, and relatives. They also have access to a wealth of information and will look for third-party confirmation to be sure you are worth their time and money. If you can deliver, or better yet, go beyond what you've promised in your marketing messages, they will very likely spread the word. Make sure everyone in your organization understands this. It's all about the promise versus the actual experience and the resulting buzz will either work for or against you.

Because of their economic clout, Boomers have been, and will continue to be, an attractive market. The hospitality industry, along with the rest of the business world, has focused on them for decades. Nothing has changed, except for the language and messages we must use to effectively market to them as they mature.

For more information on marketing to baby boomers, visit the Hospitality Sales and Marketing Association International web site at www.hsmai.org, or contact the author at jfareed@fareedandzapala.com.

* By John Fareed
* Retrieved from http://www.hospitalitynet.org/news/4026241.html

[ UNWTO ] Why Tourism?, 왜 관광인가

Tourism – an Economic and Social Phenomenon

Over the decades, tourism has experienced continued growth and deepening ‎diversification to become one of the fastest growing economic sectors in the world. ‎Modern tourism is closely linked to development and encompasses a growing number ‎of new destinations. These dynamics have turned tourism into a key driver for socio-‎economic progress.‎

Today, the business volume of tourism equals or even surpasses that of oil exports, ‎food products or automobiles. Tourism has become one of the major players in ‎international commerce, and represents at the same time one of the main income ‎sources for many developing countries. This growth goes hand in hand with an ‎increasing diversification and competition among destinations.‎

This global spread of tourism in industrialised and developed states has produced ‎economic and employment benefits in many related sectors - from construction to ‎agriculture or telecommunications.‎

The contribution of tourism to economic well-being depends on the quality and the ‎revenues of the tourism offer. UNWTO assists destinations in their sustainable ‎positioning in ever more complex national and international markets. As the UN agency ‎dedicated to tourism, UNWTO points out that particularly developing countries stand to ‎benefit from sustainable tourism and acts to help make this a reality.‎

Key numbers:‎

The contribution of tourism to economic activity worldwide is estimated at some 5%. Tourism's contribution to employment tends to be slightly higher relatively and is estimated in the order of 6-7% of the overall number of jobs worldwide (direct and indirect).
From 1950 to 2010, international tourism arrivals expanded at an annual rate of ‎‎6.2%, growing from 25 million to 940 million.‎
The income generated by these arrivals grew at an even stronger rate reaching around ‎US$ 919 billion (€ 693 billion) in 2010.‎
While in 1950 the top 15 destinations absorbed 88% of international arrivals, in ‎‎1970 the proportion was 75% and 55% in 2010, reflecting the ‎emergence of new destinations, many of them in developing countries.‎
As growth has been particularly fast in the world's emerging regions, the share in international tourist arrivals received by emerging and developing countries has steadily risen, from 32% in 1990 to 47% in 2010.
Current developments & forecasts:‎

International tourist arrivals grew by nearly 7% in 2010 to 940 million;
In 2010, international tourism generated US$ 919 billion (€ 693 billion) in export earnings;
UNWTO forecasts a growth in international tourist arrivals of between 4% and 5% in 2011.

[ TED ] Matthieu Ricard on the habits of happiness

Report says hotels lose out with merchant sales on the Web - Travel Weekly

Report says hotels lose out with merchant sales on the Web

By Danny King

LOS ANGELES — When U.S. hotels distribute rooms through online travel agencies (OTAs) in merchant sales, they give up twice as much in lost revenue as they pay out in commissions on standard agency sales, according to a new research report from Smith Travel Research (STR) and the American Hotel & Lodging Association (AH&LA).

The report, presented at the Americas Lodging Investment Summit (ALIS) here last week, both reflects and supports hoteliers’ efforts to rein in digital distribution costs with initiatives such as the new RoomKey.com booking site.

U.S. hotel owners collectively discounted their rooms to OTAs by about $2.7 billion, up from about $2.4 billion in 2009 and more than double the $1.3 billion in commissions paid to travel agents through GDSs, according to the 214-page report.

Additionally, distribution “costs,” in the form of those discounts and commissions, may almost double over the next few years as more reservations are booked online, according to the study.

OTA discounts on average accounted for about 25% of the approximately $10 billion in room revenue booked through OTAs.

By comparison, hotel owners in 2010 paid about $1.3 billion in commissions on the $11 billion in hotel reservations sold through GDSs, or about 12% of that revenue.

For the study, data were culled from more than 25,000 hotels between January 2009 and June 2011.

“No channel is free, though [having a guest] walking in the door is as close as you’re going to get,” said report co-author Mark Lomanno, executive board member of NewBrandAnalytics and former CEO of STR. “The most expensive channel is the online travel agencies.”

Naturally, representatives of the OTA industry say the report oversimplifies the OTAs’ role in hotel sales, saying that OTAs boost hotel occupancy through their own advertising efforts as well as initiatives such as flash sales and opaque pricing.

OTAs spend twice as much as hotels on TV advertising and four times as much on paid Internet search advertising, according to the study.

“The argument that online travel companies ‘cost’ hotels is ridiculous,” said Joe Rubin, president of the Interactive Travel Services Association, which represents the OTAs. “If online travel companies were simply a cost, then hotels presumably would not use their services.”

The subject of costs associated with the digital sales channel has become progressively more topical as more people book online. Hotels began turning to OTAs en masse in the aftermath of 9/11. As a result, OTAs, which represented just 1.4% of U.S. hotel revenue in 2001, increased their market share the following year to 2.9% and boosted that share to 7.7% by 2010, according to the study.

“The principal job of the hotel company is to get the highest possible rate for the lowest possible acquisition costs,” said Eric Danziger, CEO of Wyndham Hotel Group, in a panel discussion at ALIS. “The industry ceded away this relationship by allowing third parties to have the best access [to inventory] and rates possible.”

As a result, companies such as Expedia, Priceline, Travelocity and Orbitz have enjoyed surging revenue over the past decade, even though hotel sales have grown at less than 2% a year and took a hit during the most recent recession.

Priceline, which first gained recognition largely for its opaque pricing model, has catapulted itself to being the largest U.S.-based OTA based on revenue, primarily though overseas hotel bookings.

“Yes, OTAs are making money at the expense of suppliers, largely by providing a better shopping experience for consumers,” said Chris Anderson, associate professor at the Cornell School of Hotel Administration.

The issue is likely to take on a greater urgency for hotels because digital distribution costs may almost double between 2010 and 2015, to about $7.5 billion a year, as more reservations are booked online and fewer rooms are booked over the phone or by walk-in customers.

Hotels also are taking a closer look at the distribution numbers because of the room-price differences among booking channels.

In 2010, hotel supplier websites accounted for 16% of room-night bookings and 19% of revenue. By comparison, OTAs accounted for 11% of the bookings but just 7.7% of the revenue.

As a result, some of the world’s largest hotel companies, including Marriott International, InterContinental Hotels Group and Hilton Worldwide, earlier this month launched RoomKey.com in an effort to cut costs by gaining a larger share of the digital distribution channel.

RoomKey.com has already secured Best Western International’s room inventory and is pitching the ability for customers to gain hotel loyalty-program points through the site, unlike bookings through OTAs.

RoomKey.com is also looking at bringing in airlines and car rental companies as partners that would list their inventory on the new site, Choice Hotels CEO Stephen Joyce said in an interview at ALIS.

Either way, continued market-share growth for OTAs is all but assured because of the combination of consumers’ growing reliance on travel-oriented metasearch booking engines and the increasing use of smartphones to book rooms, according to report co-author Cindy Estis Green, co-founder and CEO of research company Kalibri Labs.

“Some of the emerging channels are going to alter the distribution landscape very dramatically over the next few years,” Green said. “It’s not all doom and gloom.”

Follow Danny King on Twitter @dktravelweekly.

From: Report says hotels lose out with merchant sales on the Web - Travel Weekly