REPORT FROM THE U.S.—Hoteliers are adopting a wait-and-see approach regarding the recent news that search engine giant Google is upping its presence in the travel market through a series of new features.
Although Google’s long-term strategy for travel is still unclear, many hope the latest news signals the beginning of Google disrupting a playing field dominated by online travel agencies.
Google recently introduced several key changes to its Hotel Finder application, including: enhancements to its search function through map-driven data; a new crowdsourcing initiative that will seek to build richer hotel data sets through mobile guest surveys; and a hotel ads commission program that builds upon Google Hotel Ads, AdWords and other existing hotel commission programs.
Although the changes might seem fairly innocuous, experts believe it could signal the beginning of Google claiming a much larger share of the overall travel pie.
“Clearly the most important thing from a hotel perspective is we’ll all be happy with one more big player coming in to balance the landscape, so it is not being dominated by Expedia and Booking.com,” said Kurien Jacob, chief revenue officer at Highgate Hotels.
“It’s going to further spur innovation into this space consistently, creating a landscape where hotels small and large will be able to compete for business more effectively. There’s a lot of spending happening by the OTAs in this space, so getting Google to come in is going to create that level for people to compete more effectively,” he added.
Map-driven data
Sources interviewed for this report are encouraged by Google’s move to optimize the map/geographically based aspects of Hotel Finder.
The company has now overlaid Hotel Finder search functionality within Google Maps, which should improve the overall experience and gives today’s traveler exactly the kind of location functionality they’re looking for, sources said.
“Map-based stuff is great and is highly visual. That’s where everything’s going. Maps are a huge component of what’s important,” said Robert Cole, president and founder of hotel tech consultancy RockCheetah.
“They’re helpful because if somebody doesn’t really know the area and is going there for the first time, where they stay and what stuff is near is a really important thing. Hotels have been notoriously bad for saying, ‘We’re close to everything.’ Google has Street View and all sorts of really interesting opportunities with maps, so that’s huge.”
Mobile surveys
By reaching out to consumers through mobile surveys, Google also will be amassing a litany of crowdsourced customer travel data, which assumedly then will flow into the hotel profiles displayed on Hotel Finder.
Some perceive the move as an effort to compete with popular recommendation sites such as TripAdvisor. If that’s the case, experts believe Google will have some serious catching up to do.
“These mobile surveys just don’t show how much user-generated content they’re going to need if they want to become a trusted resource like a TripAdvisor,” said Lauren Levin, senior VP of marketing and communications for Sbe.*
“Without knowing that the person stayed at the hotel and dined at that restaurant, I’m just a little bit wary of how people are going to trust these quick mobile surveys, and if that will really build enough robust content to have a curated experience where you feel like you’re really understanding the brand experience.
“It works on TripAdvisor, and I’m still questioning whether it’s going to be a homerun for Google,” Levin said.
Hotel Ads commissions
Then there’s the new hotel ads commission program, which expands Google’s partnership with hotels beyond its existing AdWords program and its other commission-based hotel agreements by offering a hotel’s lowest available retail rates and direct booking functionality through Google.
This is where the details remain the haziest for hoteliers, sources said.
While operators are intrigued by the prospect, experts indicated they will fully investigate the new commission structures before participating and will weigh Hotel Finder’s fit with their property types.
“At Sbe, we’re managing more experiential, higher-end hotels, and we feel like the limited content that is available through the Google platform for booking may take something away from the guest experience,” said Nicole Young, VP of revenue management and sales for the company.
“For more simple properties, I think it’s a great convenience. It’s really going to depend on what kind of asset you’re on. Before, we felt good about spending on AdWords, because we knew that the rewards at the end of the day for that was a direct booking, which is our most profitable booking.
“Essentially what Google has done is to put a barrier in between that. That’s something we’re always going to be cautious of,” she added. “There needs to be some really big upside to this for hoteliers.”
The one-stop shop
From a macro perspective, Google’s moves also signal a potential boosting of the company’s travel presence as it works to create an all-inclusive one-stop-shop environment within both the desktop computing and mobile worlds, similar to what Apple has done with its own broad array of products.
“People come to Google everyday dreaming about their next trip. Our goal is to connect them with the right hotel in the right moment. We work closely with our partners to enable them to connect with these potential customers,” Rob Torres, Google’s industry director of travel, wrote in an email.
But in the face of OTA giant Expedia recently acquiring Travelocity and Orbitz (that latter of which is still subject to regulatory review) and acquiring a majority stake in metasearch site Trivago, observers remain hopeful Google can gain enough market share to counterbalance its presently stiff competition.
“They could produce something that’s really highly disruptive,” Cole said. “Everybody’s got their walled garden, but Google cuts across them all. That’s an intriguing place to be. … It’s going to be really interesting to see what they do.”
Correction, 12 August 2015: An earlier version of this story listed Lauren Levin as Laura.