Guess what? Accorhotels' OTA is struggling to compete with the "Big Guys"
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AccorHotels plan to take on the likes of Expedia and Booking.com by opening up its booking platform to independent hotels appears to have suffered a setback.
Accor CEO Sébastien Bazin announced the “marketplace” initiative in 2015, saying: “We need to stop having the perception that the lowest price is on the online travel agent sites. We need to disseminate this truth.”
Marketplace brings independent hotels onto the AccorHotels platform and not only adds extra revenue through commission but also in theory would attract additional customers.
However, two years later and it appears as though AccorHotels is still searching for a winning formula.
Part of the problem, Jean-Jacques Morin (the company’s chief financial officer) said, was that last year the company had to spend a considerable amount of its marketing and digital effort looking after its own franchisees.
AccorHotels now has to make up its mind whether it will kill the program or push ahead, the latter of which would surely require an increase in marketing spending. The Priceline Group and Expedia spend billions of dollars each year with Google to drive traffic to their websites and their offering is already established. Expedia along increased its direct sales and marketing spend 25 percent in the second quarter to some $1.4 billion.
Morin said that AccorHotels now needed to decide how much effort it would put into publicizing the product “because today you’ve got the hotels but there are not enough people aware of it and hence the traffic is not at the level we would like it to be.”