According to Travelweekly, Expedia has been promoting to its customers the Red Lion Member Rates. Red Lion is a US / CA hotel chain with a little over 100 hotels.
Similar to many other hotel chains and independent hotels, Red Lion Hotels have their own member rates, named Hello Rewards and they offer loyal customers an exclusive “thank you package” with the following benefits amongst others:
- a free night every 7 stays,
- discounted rates,
- express check-in and check-out;
- late check-outs;
- room upgrades;
- member-only offers;
All of this is now available to Expedia and Hotels.com users, since July 2016 at least. Check out the screen shot below.
Is this an historical landmark we´re seeing?
For some time now, hoteliers are turning to loyalty rates to fight OTAs predominance in the online travel bookings landscape.
This is a commendable effort, but hardly a new approach!
In fact, the likes of Booking Genius rates (with a staggering 10% off) and Nectar Points from Expedia are being pushed for years has a (strong) selling point to OTAs users. They do even better not only offering “member only rates” but also asking hotels for “secret offers” and the pitch them publicly to indiscriminate users (see screen shot below).
The new thing here is that so far, OTAs and Hotels have been pulling in different directions and this seems to be the first time publicly open attempt of an OTA promoting a hotel member only rate to its customers.
Why? Does this make sense?
Hotels are worried at OTAs gaining more share of their online bookings pie and that is why most of them are trying as much as possible to increase their direct bookings online channels. Member only rates are a good way to force their customers to understand that “booking direct is better”.
OTAs are also worried at Hotels starting to recover their share. They need to keep on growing their share on online travel bookings. An example: the 2 giant OTA groups, Expedia and Priceline, are amongst NASDAQ biggest players on Cyclical Consumer Goods & Services sector. Priceline has a Market Cap of 69,63B.
Instead of entering a fratricide war against big hotel chains, it seems that Expedia Inc. is now looking at a more pleasant alternative: to collaborate with them!
This is a bold move because Expedia is helping Red Lion fuel its own loyal customer’s database, which on the long term can probably hurt Expedia by lowering its recurrent customers to those specific hotels.
On the other hand, OTAs strive on the customer’s idea that they “have all in the market” at the “best rates in the market”, and this is exactly what Expedia is aiming to offer its customers, the best rates in the market.
If this is going to work and get out of beta stage or not, we don’t know but we promise to keep an track on it and report it to you 🙂