By Martin Kelly
HOTELS have clearly emerged as the growth engine for online retail travel companies and Asia Pacific is set to play an increasing role with the likes of Expedia, which started trading as a stand-alone company last week, boosting its regional presence.
Travelocity is also experiencing extraordinary growth, reporting a 41% increase in hotel room nights during the June quarter when compared with 2004, while packaging revenue grew 81% and now comprises 30% of total revenue. By comparison, air transaction revenue grew 9%.
Over the same period, Expedia’s major accommodation brand – Hotels.com – recorded more than more than $US500 million in quarterly gross bookings for the first time in its history.
Expedia’s Regional Director of Hotels and Destination Services, Cameron Jones, said the company is experiencing double digit hotel booking growth in most Asia Pacific markets.
“Hong Kong in particular has experienced exceptional growth,” Jones said.
Jones said Expedia has added new staff in Hong Kong, Tokyo and Sydney to service and grow the existing customer base.
In other developments, Jones said the integration of the Expedia and Hotels.com technology platforms would be complete by the end of September, allowing hoteliers to manage inventory on both sites through a single extranet.
He added there has been strong regional adoption of Direct Connect, which allows Expedia to sell live inventory straight from a hotel’s Property Management System.
Meanwhile, Expedia reported that international gross bookings increased 73% during the June quarter.
“Revenue grew 14%, primarily driven by the international merchant hotel business, acquisitions and the air business,” the company said in a statement.
“Merchant hotel revenues increased 9% for the second quarter, (however) revenue per room night was flat, resulting from a 5% increase in the average daily room rates, offset by a decrease in merchant hotel raw margins.
“Air revenues increased 7% during the quarter, primarily from a 21% increase in air tickets sold, partially offset by an 11% decline in revenue per air ticket.
“Expedia, Inc.’s domestic air and merchant hotel businesses operate in a challenging competitive environment, due primarily to increased competition from third party distributors, increased promotion by suppliers of their own websites and higher overall occupancy rates and load factors.
“This environment is generally expected to continue.”