Expedia is attempting to move all Wotif.com contracted properties onto a single company-wide contract and is raising site commission for larger producers from 12% to 15% – an increase of 25% – four months after buying the Australian OTA.
“We are in discussions with them at the moment and there are a number of matters that need resolution, both commercial and legal,” said one leading hotelier.
He confirmed that Expedia is looking to charge hoteliers the same commission across all its sites.
Expedia has also told hoteliers that from March – date to be finalised – all Wotif.com bookings will be powered by the Expedia platform.
It has requested the new contract be signed ahead of this transition but has not been clear in correspondence about what happens to properties that don’t.
The widely anticipated move was flagged by accommodation lobby groups in submissions to the Australian Competition and Consumer Commission, which subsequently approved the deal.
“The ACCC noted the concerns raised by market participants that Wotif represented an important source of bookings for some accommodation providers and that its removal from the Australian market may result in them paying higher commission rates to online travel agents (OTAs),” ACCC Chairman Rod Sims said.
“However, the ACCC found that there has been considerable change in the competitive dynamics of the online accommodation distribution market in recent years.
“Metasearch websites increasingly facilitate hotels’ ability to promote themselves alongside OTAs, and transact directly with consumers,” Mr Sims said.
“The ACCC considered that the acquisition was unlikely to diminish the dynamic nature of the industry.
“Disruptive developments from smaller OTAs and from companies in related online sectors, such as the metasearch providers, can be expected to constrain Expedia in the future.”
In summary, “the ACCC concluded that the proposed acquisition was not likely to result in a substantial lessening of competition.”
Expedia is telling hoteliers: “In an effort to streamline how we work together, we are offering a simple and attractive compensation structure and interface for each Expedia® Collect™ booking made on Expedia group websites, including Wotif.com.
“What will change?
“You can look forward to having:
- “A single level of compensation – same compensation for bookings made on all of Expedia group websites, including Wotif.com
- “A contract covering bookings on all The Expedia group websites, that also adds bookings for Wotif.com
- “One tool for all of your interactions with Expedia – in Expedia® PartnerCentral you can manage your rates and availability, content and accounting as well as access reports on your competitive performance
- “One point of contact for all of the Expedia group brands, supported by our dedicated support teams”
There’s been a sense of inevitability in the way the Australian hotel industry has accepted the change.
Some are even looking on the bright side.
“At least it’s not 25% – there would have been a revolt,” said one.
An Expedia spokesperson said hoteliers have generally responded well to the change.
“The feedback and support we’ve received from hotels, who acknowledge the benefits of a partnership with Expedia, has been very positive,” she said.
“We are introducing the Wotif Group supply partners to the power of Expedia’s global reach and customer base and we make significant investments in marketing and technology innovations, all of which drive increased customer demand for our hotel partners.”