Accommodation providers are acutely aware of the struggle they face to fill their properties and still make a profit nowadays. High, sometimes astronomical commissions, rate parity clauses that mean they are forced to sell at the same price everywhere, pressure to give extra discounts to guests that come out of their own pocket...the list goes on.
Let's face it, consumers probably wouldn't be too bothered if they were told that accommodation providers had to pay around 20% of the room price to the likes of Booking.com or Hotels.com. It doesn't affect the consumer so why should they care? However, I bet they would think differently if they found out that it did affect them, and that the high commissions were forcing many properties to put up their prices.
Not everybody puts up their prices. Some properties have told us that they are in such a competitive area that they simply can't as they just won't get any bookings, but equally hundreds of properties have told us they have been given no option but to raise their prices significantly to counter the huge commissions. They don't want to, but they have no option if they want to run a viable business.
When you add in the thorny issue of rate parity (the clause insisted on by the likes of Booking.com and Expedia that tells properties they can't sell any cheaper on their own websites), then it's not just accommodation providers suffering. Consumers are too. The problem is they just don't know it. When they book a room on Booking.com or Hotels.com or Agoda.com or Expedia.com, they see the same messages shouting about the cheapest prices; money off here, money off there. They don't know that it's the same price everywhere. They're not getting the best deal, they're getting the only 'deal'.
Consumers don't realise that the high commissions charged by the 'big two' in online bookings (The Priceline Group and Expedia) are effectively forcing properties to push up their prices, and that their rate parity clauses mean the prices are getting raised everywhere. The end of rate parity will at least bring some competitive pricing, and give properties the chance to drive more business through their own website or through a low-commission OTA like Hotel Bonanza.
*A message for the thousands of properties that have registered and are waiting for us to go live: we are just completing connections to some major channel managers and our soft launch is imminent. Thank you for your patience and we are looking forward to working with you all. For those that have not registered yet, join us now and help us change the way the online booking industry works.