June 13, 2018

The impact of rate blending on parity

Though the hotel industry as a whole has been aware of it for a while, rate mixing or 'blending' continues to be an area in which OTAs outstrip their hotel competition.

For the uninitiated, rate blending is a technique whereby OTAs can ensure they're providing the customer with the best rate by mixing different rate plans to meet the search parameters.

Confused? Let's break it down with an example.

Hotel A is promoting a two-night special whereby guests get a 50% discount when booking a two-night stay on particular dates. This special is also available on Booking.com. Now, imagine a guest searches for Hotel A on Booking.com for the dates June 19-20th. The special rate applies to the night of the 19th, but not to the night of the 20th. Where Hotel A's website would show the guest two nights at the full rate (because the search dates do not meet the conditions of the offer), Booking.com would take one ordinary rate and one night's worth of the 'special' rate, add them together, and serve the guest a cheaper offer.

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