Just a short note this week on some observations as more money is being pumped into the accommodation sector.
In particular, the metasearch engines and their advertising which seems to have some curious claims.
As the hotel and VR industry converges, these marketing behemoths continue to push themselves forward as the only place to search for hotels, lodges, resorts or vacation rentals. They supposedly offer the biggest selection at the best prices!
Trivago who seems to have been through a bit of storm recently has hit the UK headlines in London this year as they adjust their online spend.
Their TV advertising this week boasting over 1m hotels seemed a little overzealous and possibly in contravention of the ASA.
Just searching on Google the claim is inflated further to 1.8m hotels!
Tnooz has much lower numbers and probably focusses just on hotels (not including B&B’s, resorts etc)
In their report, Booking.com says it offers 202,842 hotels globally and
the number likely is anyone’s guess and much of it hinges around your definition of a “hotel.” STR Global estimates that there are 187,000 hotels, offering 17.5 million guest rooms, around the globe. That would be 93 rooms per hotel on average.
With 1.8m hotels would result in 167m rooms available. An average stay is 3 days, in which case there are about 100 booking opportunities in a year and at 65% occupancy, this is reduced to 65 or almost 11bn bookings in total possible per year.
Just enough space for a couple of short breaks for the whole planet’s population in the hotel of their choice!
Are vacation rentals going the same way?
Last week, Hometogo a meta-search engine for Vacation Rentals announced a further investment and the press says they provide over 11 million offers from more than 250 providers. (In all fairness, this could mean 30,000 properties with 365 days on offer).
Then there is Hundredrooms which claims 6,868,052 holiday rentals around the world.
The global numbers of vacation rentals a few years ago were estimated at 5-6 million by HomeAway and there are lots of stats available. Even with Airbnb now pushing the rental space boundaries (2.5m+), 10m individual holiday homes seems rather extreme, especially as many cannot be considered holiday homes, more like shared spaces.
Not only are the numbers an exaggeration, even if the market was this large, they would have 100% of the market available.
It’s all PR
Metasearch engines are designed to match prices on the same room, hotel or vacation rental.
This is where the anomaly occurs. These metasearch engines use OTA’s as one of their main sources of inventory and these properties are also marketed across all the big OTA’s and other marketplaces. Ideally, they should be matched and compared, but hard to do without intelligent property definition as with hotels.
Presumably, guests love to know they have unlimited choice, but also suffer “paralysis by analysis” and become subject to intelligently automated suggestion, which can be based on any number of parameters, including margin.
There are three kinds of lies: lies, damned lies, and statistics. Perhaps Mark Twain or Disraeli had this right. Surely the public should have accurate information or are we just becoming used to creative data and a blurring of the lines? Or would lines such as “100,000 properties in total, supplied from 50 different sources and compared to see which offers the best price and terms”.