After the release of Google Hotel Search, Google is taking another step towards taking over hotel booking with the launch of “Book on Google”.
If you do a hotel search on Google, you may indeed see a new feature appear.
At the time of the release of Google Hotel Search I had hypothesized that Google would decide to go further and not resist the opportunity to play a dirty trick on OTAs (online travel agencies). It’s done.
It all starts with a hotel search on Google with the Google Hotel Search result appearing on the side (OTAs who spend a fortune on marketing to get their offers up in the engines will love it…but that’s another topic).
If you click on “Book a room” you will arrive on the following screen.
As usual Google shows you the price list available both at the hotel and at the OTA, which allows you to see that the hotel is doing its job badly. He lets the OTAs position themselves cheaper than him whereas if he proposed the cheapest rate he would save the commission to be paid to the OTAs (12 to over 20%).
The novelty is at the bottom of the screen with photos of rooms associated with rates.
And if you click on it…
“Google will transmit your reservation and payment information securely to Novotel Tour Eiffel Hotel who will take care of customer service once your reservation is made“
What does this mean? That you can book directly through Google but that Google does not play the role of an OTA, just an intermediary.
This is very well explained in the terms of service…
Google takes all the information and sends it to the hotelier who will handle the service. Google takes advantage of the fact that it has all the information about you (or asks you to give it if it doesn’t) in order to simplify the information entry and make your booking easier. By the way, you will notice the possibility to pay by Google Pay. But you can also pay by credit card.
But you are recognized as a guest of the hotel. Remember that in general when you book through an OTA you are not entitled to the benefits of the hotel’s loyalty program. Google positions itself as a facilitator without taking any commission from the hotels and by giving them the customer data, which the OTAs don’t do, or do it meticulously.
A big blow to OTAs
With Google Hotel Search the OTAs were in danger of losing their role as the preferred gateway to booking, especially since the Google solution allows you to easily compare all the rates and realize that the OTAs are not always the cheapest, and far from it (provided that the hotelier does his job well).
Now they risk losing their core business of booking, where they make their money.
It’s hard not to imagine that Google is doing everything in its power to “keep” the user throughout the search and purchase process and that OTAs are left with the the least traffic possible. They will not disappear screens but will be in a less valuable position.
Google the new friend of hoteliers? Not sure!
Here we can say that hoteliers can only rejoice. They recover a better visibility compared to OTAs that have marketing budgets that they do not have to appear in searches.
They also find a partner that will grow direct bookings without taking commission from them. And we know that if the bookings by OTAs bring in a lot of money they generate very little value.
But…there is a but! Won’t they eventually have to exchange one dependency (on OTAs) for another (on Google) which will eventually find a way to make them pay for this extra direct booking by making them take out their wallet to improve their positioning.
We will go from a competition between OTAs to a competition between hotels with restored margins, but a competition that is likely to be costly for the hotelier.
Google the new friend of the customer? Not sure either!
We can say that the customer is the big winner of the story? Way to look at it but I’ll be more cautious on the subject.
By keeping the customer in the Google Travel ecosystem, knowing all their searches, and furthermore asking them to provide all the necessary information for the booking, Google gets one more way to capture personal data with less effortwhich I’m not a big fan of because of my natural distrust of this business.
It is also a good way for Google to spread Google Pay more widely.
A business model to be found
If the initiative of Google seems nice for the hotelier and the customer, it cannot remain “free” for long. In 2018 OTAs (Expedia, Booking etc) spent $10 billion on digital marketing to get good search engine rankings, with Google recouping most of that investment. I find it hard to believe that they will continue to pay so much for less visibility and, moreover, by financing what is now a competitor.
Google wins every time
And who is the big winner in this case? OTAs ? No way! Hoteliers? Not so sure. The clients? A little but with a price to pay on their personal data.
As usual when Google takes care of a subject it is often the only winner.
“Book on Google” soon on your screens
You will find today only a few hotels for which Google offers this functionality in France, the feature being still in pilot mode until the search engine has developed the necessary partnerships to interface with the hotel reservation systems. It’s already rolled out in the US though.
But expect to see it coming soon!
Photo : Booking.com by Denys Prykhodov via Shutterstock
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