REPORT FROM HAWAII—With multiple source markets to manage, Hawaii presents perhaps the quintessential distribution challenge for hoteliers.
Long a leisure hotspot (with a small, but not insignificant group and corporate component), hotels operating in Hawaii must juggle in-state demand along with such source markets as Asia/Pacific, North America and others farther afield as well.
Mark Stebbings, GM at the 71-room Travaasa Hana, said travel wholesalers and online travel agents are an important component to hotel success on the U.S. island state.
He said the numerous source markets facing hoteliers in the state necessitates the use of OTAs. The third-party booking agents help hoteliers dig into this wide demand base.
“When we do anything (with the OTAs), we (try to) create a rate strategy,” he said, noting California is the hotel’s biggest source market.
Despite all the planning, sticking to a rate strategy can be difficult, he acknowledged. “We play by their rules,” he said of the OTAs. “They’re out there. They’re a part of this world.”
Stebbings declined to identify what percentage of bookings OTAs represent at his hotel.
Thomas Steinhauer, regional VP and GM of two Four Seasons resorts in Lanai and the Four Seasons Maui, said his hotels strive to maintain transparency across all channels. OTA bookings represent the smallest slice of bookings at the properties, approximately 3% or 4%, he said.
According to “Distribution Channel Analysis,” published by the Hospitality Sales & Marketing International Foundation, online distribution sites accounted for an estimated 8.4% of consumer spend in 2011. Ten years earlier, the online sites accounted for an estimated 1.4% of spend.
“The No. 1 thing is you pay attention to your own website and who your customer is,” he said.
Hawaii appears to be a market OTAs are keeping a close eye on. Hawaiian Airlines entered into a multi-year partnership with Orbitz Worldwide Distribution in January.
“Hawaiian Airlines is a very strategic partner for Orbitz due to the market it serves, its loyal online customer base, and its commitment to offering great value in vacation packages to its customers," Ronnie Gurion, president of Orbitz Worldwide Distribution, said in a news release.
Orbitz, through a third-party public relations company, declined to comment for this report.
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Every distribution channel is wide open” at the Best Western Plus Coconut Waikiki, said Elizabeth Churchill, VP of sales and marketing for Aqua Hotels & Resorts, which manages the 81-room property.
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A spokesman for another OTA, Priceline.com, referred questions to the Hawaii Tourism Authority, saying in an email the OTA has a policy against commenting on specific markets. The Hawaii Tourism Authority did not return messages seeking comment.
Analyze OTA trends
Other hotel officials in Hawaii echoed Stebbings’ view on the importance of OTAs in the marketplace.
“Every distribution channel is wide open,” said Elizabeth Churchill, VP of sales and marketing at Aqua Hotels & Resorts.. Aqua has under its umbrella 19 Hawaiian properties comprising approximately 4,000 rooms, including the Best Western Plus Coconut Waikiki.
In addition to the big United States market, she said the 81-room Best Western Plus during the past several years looked at markets such as Australia and Canada to help drive business. The focus paid off during the downturn, as business from Australia and Canada stayed strong as the U.S. lagged. As of now, the Coconut Waikiki is seeing an even mix of business across markets including the U.S. West Coast, Korea and China.
Churchill said it’s important for hotels to track OTA performance trends when devising an OTA strategy. Steinhauer said determining which OTA to put your hotel on depends on what kind of customer you are pursuing.
Also, Churchill noticed OTA buyers at her property are booking stays farther in advance than through other distribution channels.
“They all have their own … strengths and weaknesses,” she said of the OTAs. “Certainly, one may work for one hotel over another.”
