Amazon Travel, Ads on Facebook, and Thinking Beyond the Compset

In recent hospitality news, Amazon announced its new Amazon Travel platform, Facebook revealed plans to cut unpaid posts by marketers on news feeds, and an editorial article on ehotelier challenged hoteliers to think beyond the compset.

Amazon Announces Hotel Bookings on New Travel Site

Skift reported this week that Amazon plans to launch Amazon Travel as early as January 1, 2015. The service will feature bookings at independent hotels and resorts near New York, Los Angeles, and Seattle.

One hotelier that Skift interviewed said that part of Amazon’s criteria for selecting properties for the initial launch of Amazon Travel was based on TripAdvisor ratings. The criteria also specified that the hotel property had to be rated four stars or higher.

CLICK HERE to read the full article on Skift.

Facebook to Suppress Salesy Posts by Brands

Also beginning January 1st, Facebook announced that it would institute a new policy around promotional posts by brands. The social network plans to change the rankings of marketing posts on brand pages, particularly those that are, for example, announcing a sale or promoting an app.

The New York Times interviewed Rebecca Lieb, a digital advertising and media analyst at the Altimeter Group, who said, “It’s a clear message to brands: If you want to sound like an advertiser, buy an ad.”

This move by Facebook is an interesting one. While it may irritate brands that use their Facebook pages for promotions, it clearly supports two things: One, that Facebook is solidifying its position as an advertising platform. Two, that consumers don’t want to see traditional advertising in their newsfeeds. So, if brands want to reach their customers on Facebook, they’ll have to provide value by focusing on telling a story and connecting with their fans, instead of using salesy or promotional posts.

Like we discussed in our recent webinar, hotel marketing has to change, if it’s going to continue to be effective with the modern consumer. Facebook’s announcement is just another supporting point.

CLICK HERE to read the full New York Times report.

Thinking Beyond the Compset

This week, ehotelier published an editorial by RevPAR Guru’s Jean Francois Mourier that points out some flaws in basing pricing on compset. The editorial should be taken with a grain of salt, as RevPAR Guru is a competitor of STR, the founders of the compset concept, but Mourier does make some interesting points.

For example, Mourier claims that the evolution of hotel booking technology and consumer behavior are no longer supportive of the traditional definitions of the competitive set. A consumer starts his or her search for a hotel by putting together a budget based on the maximum dollar amount they want to spend, and the amenities he or she prioritizes in a hotel. When this consumer is comparing hotels, he or she may actually be looking at all the properties in a destination near a certain price point, regardless of star rating. Hotel websites, OTAs, Airbnb rentals, and other vacation rentals may also be in play.

While I’m not convinced that Mourier fully makes an argument for discarding compset, I do agree that it’s very important to consider consumer behavior when implementing a pricing strategy, and that traditional compsets alone may be inadequate in this arena. Read the editorial for yourself and tell me what you think!