Can the hotel industry take back control of its inventory and pricing?  The airline industry seems to have been able to make airline booking websites irrelevant for air-only bookings.  Rates are almost always a few bucks cheaper by booking direct and the airlines will usually throw some perks your way (usually bonus miles) when you book direct too.  Can hotels pull off the same thing?  It would seem to make sense in today’s exploding lodging market.

A recent study by PFK Hospitality Research said that U.S. hotels are forecast to enjoy their fourth consecutive year of profit growth in 2007.  So, why not push to keep more of that margin for themselves?

According to a survey released yesterday by Mintel:

After 9/11, hotel companies allowed excess inventory to be sold by third-party Internet sites at discounted rates. This helped to spur increased traffic, but resulted in lower direct online bookings for hotels. With the hotel industry showing signs of robust growth, the direct hotel companies are trying to expand their sales in the online market. With reservation rates rising, hotels are resorting to limiting third-party inventory and promising the lowest prices through their own hotel brand sites.

The online agencies are posing a threat to hotel revenues.  Is this a threat to the online agencies?  Most of the well-know agencies have done a great job at branding themselves as a one-stop-shop for leisure travelers, though, and this is what will keep them in the game.  But for those of us who usually book components separately, going direct to save some coin is the best option.

According to Mintel, more than 36 percent of survey respondents used an agency site to book their hotel stays, compared to 32 percent who said they used the hotel’s Web site.  With combined revenues of over $40 billion, a few points either direction makes a huge difference on the bottom line.

The advantage that the agencies will probably always have (for the foreseeable)  is the ability to search, search and compare hotels side by side.  Although, I can see how this may be a opening for a really good travel search engine, which I’ve not yet run across…


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