April 28, 2016

Hilton sees gains from direct booking initiative


Three months after launching a campaign intended to get guests to book direct with the promise of lower room rates and free Wi-Fi, Hilton Worldwide reported growth in bookings through Hilton.com and its mobile app.

"We have global scale in a business where scale matters and are using it to drive a more direct relationship with all of our customers," CEO Christopher Nassetta said during the company's quarterly earnings call on Wednesday. "The business we received through web direct is higher than it's ever been and is growing faster than ever, thanks to increasing share shift. The share of web direct channels in our distribution mix is growing five times that of the [online travel agency] share of growth in the quarter." Nassetta said HHonors enrollment since the launch of its direct booking campaign increased almost 90 percent, and HHonors occupancy hit a record 55 percent during the first quarter, a 4-point year-over-year increase.

Hilton's decision to market direct booking through its loyalty program as a way for guests to gain perks like free Wi-Fi and online check-in has led other lodging players to follow suit. Marriott this month began adding Marriott Rewards member rates to its website that are lower than retail rates. Hyatt last week announced a similar initiative, tying lower rates and complimentary amenities to direct bookings made on Hyatt.com or through its app.

One travel manager, who preferred not to be identified, noticed the new Marriott rates and expressed concern about the growing trend from hoteliers. "It confirms my suspicions that the sales teams are not working close enough with [the loyalty teams] to protect the integrity of the corporate rates offered," the travel manager said. "I am almost convinced that they are trying to take our travelers from our managed programs and push them right into their own Brand.com. This tactic may seem good right now, but long-term I think they will hurt themselves as they hurt the relationship between the buyer and supplier."

Get the full story at Business Travel News and the Los Angeles Times

Read also "How Hilton is convincing travelers to book direct", "Hilton to temper its stance on booking direct", and "Analysis: The direct booking challenge"