Rate leakage: Hotelbeds wants to support hoteliers and property owners to prevent Rate Leakage

Apr 11, 2019 | connections

Redistributing of inventories and reselling offers from one channel on another is not a new thing but with the more widespread use the booking-basic rate on Booking.com in European hotels since December 2018, the rate leakage topic has been fueled again.

A good summary of how booking basic works has been published first in July 2018 by our partner Mirai or by Triptease in a full white paper.

In summary, with OTA’s usage of leaked rates, hoteliers could have a serious parity issue which also could lead to a conversion issue on their direct channel. That is besides the issue of not respecting the restrictions on the wholesale and packaged rates.

Hotelbeds, one of the potentially accused providers of leaked rates, has recently entered the discussion by clearly opposing rate leakage. Hotelbeds is saying that they are not encouraging or supporting rates leakages and is not making available to any of these channels those FIT rates that are meant to be packaged. Additionally, the wholesaler assures to be taking a stance proactively to ensure that their customers don’t use those rates in that way. Hotelbeds will be watching out for anyone we feel is doing this and will take action where necessary to stop it, if necessary penalizing and disconnecting customers who take advantage, as the company understands and shares the concern or its hotel partners.

Hotelbeds also claims that it has recently taken two steps to proactively deal with this situation: first of all, segmenting their distribution by leveraging the advanced data analytics capabilities and secondly, significantly increasing the size of the team dedicated to monitoring this area. However, this is so far limited to FIT rates.

According to Sam Turner, Director of Wholesale Sales & Sourcing, Hotelbeds, the best way to prevent leakage is to work with fewer but better quality wholesale partners. It is important that their partner not only offers solutions to resolve this challenge, but that they also fully respect a hotel’s needs: only distribution partners with a long-term, win-win approach should be considered viable. The full interview with Sam Turner, Director of Wholesale Sales & Sourcing, Hotelbeds is available here. 

Has your property suffered from the negative consequences from rate leakages? Would you like to know more how to thoroughly control your online distribution? Get in contact with the expert team at YieldPlanet to discuss your individual online distribution.