Hotel reservations: an increasingly interconnected world

Complex, fragmented, disrupted... The market for corporate hotel reservations The travel industry has come under considerable pressure in recent years. Whether it be the rise of online travel agencies - the famous OTAs such as Expedia or Booking - or the emergence of specialist platforms, HRS or HCorpo among others. Just 10-15 years agoFor example, corporate travel agents could rely on the range of chain hotels available in the Amadeus or Sabre GDS distribution systems to meet their customers' needs. Occasionally, they could pick up the phone and contact independent establishments which, given the high costs for these small structures, did not appear in the GDSs. So there was nothing totally automated about it, nor was it really exhaustive.

The whole thing became precarious when online agencies started to open up to bookings on the Internet.he myriad of independent establishments which still account for more than two-thirds of the world's hotel supply, excluding North America. While the general public was quickly won over, business travellers also adopted Booking and Expedia in order to find the right hotel at the right rate, which is often lacking among those offered by their professional solutions.

Applying to the corporate world what has made OTAs so successful in the leisure sector, booking platforms have exploited the weakness of GDSs and TMCs to carve out a key place for themselves on the hotel market. Their main added value lies in a strong content of hundreds of thousands of hotels, to avoid the scattering of bookings outside corporate channels. This is where what's at stake for companies: succeed in capturing, through ad hoc solutions, the largest possible share of hotel expenditure in order to control a substantial budget, which for a CAC 40 company can range from €25 million to €100 million.

Necessity is the law. Driven by companies keen to shed light on their hotel budgets and spurred on by competition from consumer sites and booking platforms, GDSs and travel agencies alike have had to step out of their comfort zones to expand their content. "We now offer more than 750,000 hotels and millions of rates.explains Jamel Chandoul, Amadeus Sales Director for France. To achieve this, we have developed an open, multi-channel and multi-source platform, which brings together the offers of hotel centres such as AlbaTravel, Bedsonline, HCorpo, HRS, Teldar and Djoca, a centre with an extensive offer in France, including small provincial towns. We have also created our own centre, Amadeus Value Hotels. Agencies can compare all these sources on their Hotel Plus sales platform."At the same time, Cytric Travel & Expense, the self-booking tool that Amadeus is in the process of deploying for companies, includes GDS content, of course, but also that of specific aggregators such as Booking.com, CWT Power and soon BCD's Trip Source Hotel.

Similarly, travel agencies have also stepped up their game by turning to other players in the sector. "GDSs still play an important rolesays Peggy Studer, Carlson Wagonlit's vice-president in charge of the RoomIt hotel solution. However, to meet travellers' demand for convenient locations and competitive prices, it was necessary to forge other partnerships, whether with aggregators, key intermediaries in the sector or the hotels themselves. By expanding these agreements while negotiating our own rates, we have increased the number of properties available in Europe by more than 400 %."

The art of dialogue

Claude Lelièvre, Vice-Chairman of the French Association of Travel Managers (AFTM), observes that "these major changes are taking place in the travel industry.TMCs have come back into the race by integrating things that have proved their worth outside, whether hotel reservation platforms or aggregators such as Booking. They have realised that if they are to continue to add value, they need to be able to provide their customers with a complete, turnkey holiday."

In the same way as Carlson, BCD Travel has developed its solution Trip Source Hotelpresented by Laurent Bensaid, Director of Account Management at BCD Travel France, as ".a multi-source consolidator giving access to the main market players, aggregators, GDS, etc."For its part, American Express GBT has developed a platform bringing together GDS content, that of OTAs such as Booking and players such as HCorpo and CDS. "Technically, we are open to all sources. We can potentially working with everyone"says Jean-Marie Longin, Director of Hotel Sales for Europe, the Middle East and Africa at American Express GBT.

As far as hotel platforms are concerned, the direction is the same, that of a open dialogue with all the parties involved. "The links have inevitably become closer, in line with the wishes of companies. They want to have just one point of contact for their travellers to book their business trips. As our content can be integrated into all tools, we can satisfy all companies."explains John Baird-Smith, Managing Director France at HRS.

HCorpo has also established live connectivity with the world of the corporate world, whether it's the publishers of self booking tools or payment solutionsrisk management companies, and of course GDSs and travel agencies. "It was a necessary step, almost an obstacle course that took us two years, but it was essential.says Stéphane de Laforcadefounder and chairman of HCorpo. If you're not connected to all the suppliers in the sector, you can't work with their corporate customers. It's up to us to adapt, not them."

In the end, with everyone talking to just about everyone else, the booking ecosystem seems to have reached a certain maturity. But is this the end of the story? Probably not, because there are still several major challenges. "What we need to do is convince travellers that the tools available to them are the right ones and that they will find the offer that suits them."as described by Laurent Bensaïd of BCD Travel.

A number of factors therefore need to be taken into account to increase the adoption of these tools, without which any desire to centralise and reconcile expenditure is compromised. In this context, just as much as the diversity of content, price is a determining factor. "One of the challenges is the ability to demonstrate to employees that they will not find lower rates elsewhere than those negotiated by the company. And for the same conditions"Agathe Fabron, Vice President of Business Travel and MICE in AccorHotels' Global Sales division, confirms this.

Everything gets complicated

This is where things get complicated. Because, for a traveller unfamiliar with the subtleties of the tradeFor example, when a hotel that is part of your company's accommodation programme is no longer available via your agency or self-booking tool, but is still offered for sale on Expedia or Booking, it is not always easy, if not impossible, to understand why. "Hotels can choose to open or close certain distribution channels, for example during a major trade show in Paris, in order to favour higher-priced sales and direct distribution, which is less subject to commissions."says Jean-Marie Longin of Amex GBT.

Theoretically, companies are protected against this pitfall by a clause in their negotiated rates: access to the last available room. Or LRA, for "last room availability. But we still have to agree on what the LRA is... Room categories, flexible cancellation conditions, breakfasts included, free WiFi or parking: various advantages are included in the corporate rates, and hotels reserve the freedom, depending on their activity, to allocate a greater or lesser proportion of their inventory to them. "If the last room at that rate is used up, the customer no longer has availability."says Ziad Minkara, founder of the CDS Group.

Disturbing, isn't it? "Travellers often find it difficult to grasp the concept of limited stock.says Claude Lelièvre of the AFTM. The LRA clause included in the negotiated price only applies to one or two types of room, and not to the entire hotel."Hoteliers are defending themselves against these occasional shortfalls in availability and are looking the other way. "If they don't want other types of rooms to be displayed, that's up to them.says Agathe Fabron from AccorHotels. We therefore recommend that they pricer' different categories of rooms so that hotels are always displayed in their tools."

Book at the best rate

Whatever the case, the lack of availability of corporate rates is one of the main reasons why travellers are turning to other booking sources, starting with Booking. "Unlike the negotiated offer included in the GDS, we distribute all the room categories of a hotel. This means that the hotel is always open for sale."says Claire Soubeyroux. However, the head of business travel at Booking in France is not encouraging business travellers to browse the site for their business trips, and even has a message for them: "Don't be tempted to go to Booking.com! with a view to finding a better rate. It's all there in your corporate solutions."

For some years now, Booking has been aiming to bring the power of its marketplace to the business world, and to do so it has merged into the magma of corporate hotel reservations. Alongside its Booking for Business offerThis leisure player has formed partnerships with American Express, Carlson Wagonlit, BCD Travel and Havas on the agency side, and HCorpo, CDS and Rydoo on the booking platform side.

"It is real comfort for us, travel managerssays Claude Lelièvre of the AFTM. With Booking's offer integrated into a self-booking tool with the travel agency or reservation platform, travellers no longer have the excuse of saying: 'I found something better or cheaper on this site'.." A positive corollary: bookings made via Booking are now part of an official framework. As a result, they can be traced, quantified and analysed.

This increasingly interconnected world, making the most competitive rates directly accessible, has another consequence: hotel programmes are losing their effectivenessThis is the case, at least, for those that are more like long directories than targeted collections, focused solely on the key hotels where companies have the greatest need in terms of rates and availability. In other words, around their head offices and subsidiaries, and close to their main customers and suppliers.

"I met with companies that had over 500 hotels in their programme, 150 of which had not received a reservation during the year.remembers Stéphane de Laforcade. You have to understand them. Before, buyers only had no possibility of doing otherwise than to negotiate with as many institutions as possible. But with the rise of platforms like ours, we are often able to get a better price than them thanks to our pooled strike force."

Claude Lelièvre agrees: "By using a platform alongside the hotel programme, we can reduce the number of references. We concentrate on establishments on which we have negotiating levers with the chains, with marginal hotels booked on the platform, which in turn negotiates better prices than the daily rates."

The "best buy"Whether or not the hotel is part of the hotels programme, it seems to be becoming more and more commonplace. the standard on the part of travellers. According to Paul-Édouard Le Bret, Director of Global Business Travel Sales for the Louvre Hotels Group, this is having an impact on relations between hoteliers and companies: "In the end, our rates are put in competition with those of other hotels, but also with those offered by business providers such as platforms or agencies. This calls into question the relevance of the rates contracted by hoteliers."

In this context, if there is one point on which everyone agrees, it is the desire to avoid time-consuming calls for tender - or RFP - launched by the companies with the chains and establishments. "We work on it from July to December, then from January to June, we spend our time checking that the negotiated rates have been charged, and so on."says Claude Lelièvre. A very tedious process, as Agathe Fabron readily admits: "For both us and our customers, this work phase is extremely long and consequential. So we have to find effective solutions."

A tedious process

As a result, the AccorHotels director is looking ahead to the implementation of new organisations. "Companies keep a core programme with fixed rates, but on a much smaller perimeter than before. The second part of the programme is based on dynamic rates, with a discount on prices that fluctuate according to activity. Finally, the third part of the programme, which does not require an identified volume of bookings, guarantees a discount on the best rate of the day in the majority of our hotels."

Optimised prices, an exhaustive range of hotels: companies seem to have all the cards in hand to go further in controlling their hotel budgets. Well, almost... Because, at the end of the day, the nomadic executive remains an ordinary traveller, expecting to find the same ease of use in the business world and for booking holidays. So the key to adoption also lies in providing user-friendly solutions. "It's our responsibility to be able to develop easy-to-use tools in the image of the pure players, who are really good at the customer journey. But it is also, and above all, the responsibility of the TMCs and GDSs.says Agathe Fabron.

B2C or B2B, the frontier no longer exists for the new generations. Laurent Bensaïd of BCD Travel sums it up this way: "If you can't keep it simpleWe can't pick up passengers."Photos, maps, filters and traveller reviews: the whole market is agreed on the need to enhance their tools with things that have proved their worth in the leisure sector. Even the GDSs, often accused of being old-school solutions that lack technological agility and are too professional, have grasped the importance of the customer experience. "To make booking easier and simpler, we completely overhauled the interface of our Cytric self-booking tool in 2017. New features have been added, including descriptions of hotel facilities and photos, search filters, hotel ratings and a reminder of the last hotels booked."says Jamel Chandoul.

However, beyond this ease of use, it is probably an external factor that will definitively convert the most reluctant travellers to use the booking channels endorsed by travel managers. "The key factors in favour of adoption are safety. Many companies today impose strict rules to ensure that they always know where their employees are. In this context, there is nothing more effective than forcing travellers to use platforms and other referenced systems to book a hotel. In this way, it is possible to achieve traceability rates of 95 % for travellers."