SINGAPORE (June 3): The rise of online travel agencies (OTAs), has caused travel players increasing pressure in terms of earnings. By providing heightened visibility and distribution capabilities to consumers over the Internet, OTAs are demanding ever-higher commissions from these providers, which range from hoteliers to airlines and vehicle leasing companies.
Enter Fastbooking, a digital solutions company that helps hotels and accommodation providers, especially smaller players with limited resources, to push back against the encroachment of OTAs by channelling a larger share of their business through direct bookings and creative strategies.
We share our four main takeaways from our recent interview with Guillaume de Marcillac, co-CEO of Fastbooking:
1. Size matters in the hospitality industry
Smaller hotels are particularly vulnerable to changes in the hospitality industry, says de Marcillac, as they usually do not have the resources and technology expertise to build their own distribution platforms in-house. According to him, the challenge for smaller hotels is about channelling a greater proportion of their business towards direct bookings, instead of allowing OTAs charge fat commissions for doing most of the work for them. That is where Fastbooking plays a role as a technology and marketing partner to these hotels.
2. Cut out the middleman with the power of information
Fastbooking is sold as a web-based software-as-a-service (SAS) platform that populates hotel websites as well as the other channels where their rooms are sold, functioning as a Central Reservation System (CRS) that allows hoteliers to monitor and promote their rooms directly to their end-customers on the Internet. This provides a greater control for hoteliers over the management of their room inventory and the hotel tariffs to be levied according to the type of rooms available.
At a glance, it provides the state of play in all sales channels with the revenues generated as well as the commissions payable to third parties. That type of granular information allows hoteliers to make better-informed decisions on the allocation of room assets to optimise earnings, instead of being overly-reliant on third party sales that eat into profit margins.
3. Be seen while keeping an eye on the competition
Competition tracking is crucial for hoteliers. Hence, Fastbooking’s platform alerts other user hotels within the proximity should a particular trend, such as hotels in an area raising the tariffs for their rooms, occur.
The company also helps clients with traffic acquisition strategies to drive eyeballs to their hotel websites, the idea being that the more people visit and view a website, the more likely for room bookings to increase. “This requires a lot of expertise and savviness in knowing how to buy keywords on search engines, doing promotions and running campaigns,” remarks de Marcillac. “And the smaller hotels do not know how to do this as well as the big chains.”
4. Online, all hotels face the same challenges
Asia and Europe remain the two geographical areas of business for Fastbooking till today. “The biggest hotel chains in the world are American, so the US and Canada are the reverse of Asia – 70% of the market is controlled by big chains and only 30% is independent,” explains de Marcillac.
However, the emerging markets of Africa and Latin America are likely to be future areas of growth especially now that major European chain, AccorHotels Group, bought Fastbooking, in April 2015. Despite being owned by a large hotel chain, de Marcillac maintains that Fastbooking is run autonomously from the rest of the group: “They bought us to serve the rest of the market in Europe and Asia, two-thirds of which are not part of a big chain.”
“Whether you are a big or small hotel, the challenges are the same on the Internet,” he says. “The thinking is that if we can all be strong together on our Internet strategy, we will also be strong together in our relationships with the OTAs.”