News for the Hospitality Executive
Alliance Announces a Margin War Against the Large OTAs
April 7th, 2009 – Peter Bertenshaw, President of Alliance Reservations Network announces all out “Margin War” against the top OTAs receiving margins up to 36% or more on the rates to the public from the hotels they represent. “This is marketing extortion” says Peter Bertenshaw who operates one of the largest private-label hotel booking engine in the world. Mr. Bertenshaw continues “Unfortunately for individual hotels and brands, they cannot compete effectively against these marketers since the hotels and chains are brand marketers and Expedia, Travelocity, Orbitz, Hotels, and other are mainly destination marketers”. So, what’s a hotel to do?
Fight Fire with Fire!!!!
Alliance Reservations Network was established in 1996 and currently powers over 22,000 web marketers, group and event coordinators, corporate travel, members-only travel clubs, and traditional travel agents worldwide. Using their distribution channel, hotel’s can begin to wean themselves away from their dependence from these “High Margin” OTAs and choose a partner with more favorable and realistic margins who cares about creating a real win-win relationship, not take advantage of tough times in the market. And, since Alliance competes in many of the same channels as these OTAs, Alliance has a the ability to help their hotel partners make more money every time they take a potential client away from these large OTAs.
The problem has always been the brands believing they could re-direct customers from the large OTAs to the Hotel’s web site to avoid the high distribution cost of these channels. Unfortunately, although some gains have been made marketing to the client direct, the fact is it hasn’t come at the expense of the OTA sites. The simple fact is a brand with 5 hotels in a market cannot compete against a site that shows 100 options in the same market. Disintermediation will always be the brand’s handicap.
What makes Alliance different from the other OTAs is they are primarily a technology company that’s powers various marketing channels. Since Alliance is primarily focused on processing an online as inexpensively as possible, this means volume is more important than margin. Also, as a technology company, Alliance has built several ways in which to work with hotel vendors without them having to constantly manage an external extranet to control rates and availability. One preferred method is working with the major channel management services including Channel Rush, EZ Yield, Rate Tiger and other to effectively manage all merchant inventories across all channels with ease.
Additionally, Alliance can pull commissionable or merchant model inventory from Pegasus as a less expensive option over the high cost GDS fees. Or, exclusively offered by Alliance is their ability to dynamically create merchant model inventory using the Pegasus public rates and availability. This “hands-free” method has no Pegasus or GDS fees associated with it, it requires no maintenance, and guarantees rate parity. The hotel simply dictates the proper mark-up and mark-down rules and the rest is taken care of automatically.
To learn more about Alliance or to become a preferred partner, interested parties can contract Alliance direct at 602-889-5502 or email email@example.com.
Alliance was established in 1996 as a technology company building private-label hotel booking engine technology for various markets. In 2008, Alliance booked over $60,000,000.00 (USD) in hotels sales only. The Alliance Network includes over 22,000 web marketers, groups and event coordinators, corporate travel, exclusive travel clubs, and traditional travel agents worldwide. For more information about Alliance, visit their corporate site www.allresnet.com