Each Friday, the HotelNewsNow.com editorial staff picks the most compelling (or downright gutsy) quote and reader comment from the previous week.
Comment(s) of the week
As the role of social media evolves, there have been a few recurring themes that seem to garner the lion’s share of attention from hoteliers. Among those issues, dealing with the guest feedback—and the purported reliability of that feedback—on sites such as TripAdvisor has been a particularly popular concern.
Although TripAdvisor has launched a series of educational Master Classes to address hoteliers’ concerns and misconceptions, a few of our readers still weren’t convinced of the site’s good intentions—and didn’t hesitate to voice their concern.
Reader “Phil” commented:
“‘(Brian Payea, head of industry relations for the company, who leads portions of the classes) said there also is a team that investigates ‘any hint’ that information should come down. He declined to say how many people are on this team or how many reviews had been taken down because of suspected fraud, stating the need for confidentiality in these matters.’ A little more openness, please, otherwise there will always be the suspicion that very little is actually done beyond the (easily circumvented) automated checks.”
And reader “Susan Barry” commented:
“‘The concept of being suspect of feedback is almost a little passé,’” Payea said during an interview last week.’ Wow. Just because you say it doesn't make it true! Unless TripAdvisor takes seriously the concerns of hoteliers about accuracy, newer competitors that are tied to the (non-anonymous) social graph - such as Gogobot - are going to win over time.”
Do you think TripAdvisor adequately addresses hoteliers’ concerns about review reliability? Join the conversation by posting your thoughts to “TripAdvisor moves beyond review reliability.”
Quote of the week
Online travel agencies lost a major case in Texas earlier this month and, after poring over the judge’s findings, at least one hotel distribution consultant says the ruling will set a precedent in how municipalities collect tax on hotel rooms sold through online merchant models.
The heavy-hitting OTAs lost a class-action lawsuit by 173 cities in Texas as defendants in The City of San Antonio v. Hotels.com, which was initially filed in May 2006 and is one of the longest-running cases against OTAs. The ruling on 1 July declared OTAs must collect taxes on the full retail rate they charge consumers as opposed to the wholesale rate they get from hotels, including margins and service fees.
Robert Cole, founder of RockCheetah and former director of hotel distribution with The Sabre Group, said OTAs in the near future will begin evolving their business plans to tweak the merchant model.
“Hotels fund a huge part of their profit, so they’re not going to stop selling hotels. Some may go to a more commissionable model where it’s a little bit cleaner, but generally they don’t get major discounts on those. They’ll tweak their business models. The way this all got painted out doesn’t bode particularly well for OTAs as a profitability perspective. Almost any way you paint it, it’s a squeeze on the OTA profit model.”