NEW EU Designation; A HUGE opportunity for hoteliers

A Monumental Shift for Hoteliers … if they act fast! Booking.com is designated by the European Union as a gatekeeper under the Digital Markets Act.

EU Recognises Booking.com as Gatekeeper

Monday, 13th May marked a significant milestone for the hospitality industry as the European Union designated Booking.com, a prominent Online Travel Agency (OTA), as a gatekeeper under the Digital Markets Act. This highly anticipated decision empowers hotels to take back control over their pricing strategies, placing them firmly in command of their product offerings.

The designation’s noteworthy implication lies in the elimination of rate parity clauses, granting hotels the freedom to introduce promotions and offer lower rates on their own websites in contrast to OTA platforms. This double opportunity now stands as a significant boon for forward-thinking hoteliers, empowering them to fortify their direct online bookings and diminish reliance on OTA channels.

With this newfound autonomy, hotels can optimise their earnings by reducing dependence on OTA commissions and, equally importantly, ensure the delivery of unmatched guest experiences. Moreover, by leveraging direct bookings to their fullest extent, hotels can tap into invaluable data insights. These insights facilitate personalised interactions with guests at every stage, enhancing service quality, and solidifying brand identity throughout the booking process.

Looking ahead, the European Commission will closely monitor adherence with these DMA obligations, with potential fines for non-compliance. Additionally, ongoing discussions with relevant stakeholders aim to ensure further fair and competitive markets in the digital sector.

“The European Commission’s decision ensures greater choice for consumers and opens up new business opportunities for hotels,” stated Margrethe Vestager, Executive Vice-President responsible for competition policy.”

This pivotal decision presents astute hoteliers with a significant opportunity to thrive in the digital landscape. This window of time, more so than ever, underscores the critical importance of investing in your hotel’s technology. It goes beyond merely cutting commissions; it’s about reclaiming ownership of the entire guest experience, from booking to post-stay communication – and revisiting.

But, move with purpose Hoteliers.

Consider the case of France, whose ban on rate parity in 2014 was hailed as a liberation from OTA dominance, the below is from a 2015 article:

“It is a real revolution that is underway for the French hotel industry and for our customers, after the decision of the Competition Authority, this vote will contribute to the establishment of a renovated contractual framework to restore conditions of a commercial relationship based on trust between hotels and booking sites in the interest of the consumer.”

However, almost a decade later, Booking Holdings didn’t just maintain its market share; it quadrupled it.

Why?

France hosts a significant number of independent hotels, particularly in the one to four-star segment, comprising roughly 83% of the country’s hotel landscape. These independent establishments frequently prioritise other operational aspects over investments in technology. Could this continued neglect and insufficient investment in booking technology and digital marketing now be revealing themselves as a costly oversight?

Hoteliers, seize this pivotal moment. Investing in your hotel’s tech stack is even more financially compelling than you realise, and one seamless guest experience … often ensures another.