"No Gag Contracts"
Today, no hotel can afford not to market itself via booking portals. Representatives of the online platforms Booking and Expedia, however, are defending themselves against accusations that they offer gagging contracts, which have been voiced again and again recently.
Almost nine out of ten Swiss hotels are under contract with the booking platform Booking. However, in an interview published on Monday in the daily newspapers Tages-Anzeiger and Der Bund, the European head of Booking, Peter Verhoeven, resolutely rejected the accusation that hoteliers were being made to sign gagging contracts. Booking does not charge a basic fee, no entry fee, no minimum contract duration and the commission is only due if a customer books and also stays at the hotel, Verhoeven explained.
Online portals on the offensive
It is important for Booking that the same prices apply for the online platform as on the hotel website. However, this also means that hotels can offer different prices on other portals or in telephone sales. Andreas Nau, Central Europe boss of the Expedia booking portal, also takes the same line in an interview with the Travel Inside trade magazine. Comparability of products is imperative for an online portal, he said. "We have to do a lot of marketing and invest in website development. As a result, we also want to be treated fairly," Nau noted. Expedia provides a service and receives compensation for it, he said, and this is negotiated. Finally, he said, no one has to work with Expedia if they don't want to. "We are not a monopolist and participate in the healthy, broad distribution strategy of a hotel," Nau continued. In Switzerland, the portal already has 300 active travel agency partners after a short time.
Booking market leadership
Booking's distribution in Switzerland is significantly larger: "We offer around 10,000 overnight accommodations in Switzerland, including apartments, bed and breakfasts or houses. Of around 4,500 Swiss hotels, 4,000 are with us," Verhoeven explained in the newspaper interview. Switzerland thus accounts for a total of about 1 percent of Booking's global offering. In Europe as a whole, the portal's market share is around 9 percent of all overnight stays. Within Europe, however, the importance of the Swiss market is great, the Dutch manager emphasized. Platforms like Booking would bring Switzerland 5.1 percent or 1.8 million additional overnight stays per year. The market and price transparency is responsible for this positive effect. This leads to the fact that very often the prices are lowered and consequently the demand increases.
Commissions between 12 and 17 percent
"The loser is the hotelier who does not try out the opportunities of the Internet," Verhoeven noted. In Switzerland, 12, 15 or 17 percent commission is charged, depending on the city. Swiss rates are significantly lower than those in neighboring countries. Globally, commissions average 16 percent, he said. Since 2010, however, the commissions in Switzerland have not been adjusted. Booking also has no intention of increasing them unless the general conditions change. But if Google, Yandex or Baidu were to raise prices, Booking would also have to react, Verhoeven explained. Most of the booking platform's 13,000 employees worldwide are based in the Netherlands. The 26 employees in Zurich work exclusively in hotel support, according to Verhoeven. (SDA)
