This New App By Standard International Group Shows The Increasing Trend Within Hotels To Bypass OTAs

by Trefis Team
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Independent hotels and hotel chains are increasingly trying to gain direct bookings through their websites instead of users booking through the OTAs. In a move to attract more users, The Standard International Group along with a few select hotels have launched an app which will help users with same day hotel booking post 3 pm. The move will mean more direct bookings through hotels and consequently, less booking through OTAs.

Online travel agencies and hotels tend to have a love-hate relationship. On one hand, OTAs help hotels get a larger number of bookings (than the hotel can on their own) on account of their scale; on the other hand, hotels do not like spending on the commissions they need to pay to the OTAs in return for their services. A lot of hotel chains try attracting hotel bookers directly to their website (thereby cutting down the OTA ‘middleman’) by offering users a cheaper rate for direct bookings. Though currently, a lot of these dynamics are changing, for example: Expedia’s partnerships with Marriott and Red Lions, however, the rivalry still continues.

In one such step to gain more direct bookings for their excess inventory, Standard International, the parent company behind the Standard hotels in Los Angeles, Miami, and New York’s High Line and East Village neighborhoods, have launched a instant booking app called One Night Standard, that facilitates users to book rooms after 3pm for that particular night. The unused inventory left with the hotel post 3 pm can find hotel bookers this way, instead of remaining vacant. The app, launched earlier in 2016, proved to be a huge success.

As a result, on September 20th, the Group launched a new app called One Night that expands this instantaneous booking service to other hotels as well. Currently, the same night hotel booking can be done for hotels such as 11 Howard, Gramercy Park Hotel, Ludlow, Nomad, Oceana, Palihotel, Palihouse Santa Monica, Palihouse West Hollywood, Petit Ermitage, Refinery Hotel, Standard High Line, The Standard in Downtown LA, The Standard Hollywood, The Carlyle, The Line, The Wythe, Urban Cowboy, Viceroy Central Park, and Viceroy L’Ermitage.

Unlike OTAs, the hotels can be compared on this app on the basis of user experiences rather than their prices. The app aims to give more emphasis to the staying experience in a hotel and hence large images of the hotels are also visible for the user’s convenience.

Though this app is still operating at a very small scale as they attempt to impact the business of the OTA giants, yet, more and more independent hotels providing such attractive options to users would imply that the OTAs will also have to sweeten the deal for customers in order to attract more bookers to their websites. This might eventually lead to reduced commissions for the OTAs.

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Have more questions on Priceline and Expedia? See the links below.

Notes:

1) The purpose of these analyses is to help readers focus on a few important things. We hope such lean communication sparks thinking, and encourages readers to comment and ask questions on the comment section, or email content@trefis.com
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