Booking.com and Expedia Soften Rate Parity Stance in Australia
Booking.com has made major concessions to its controversial rate parity policy in Australia following negotiations with the Australian Competition and Consumer Commission but will still not allow hoteliers to offer cheaper rates on their own websites.
In an email this week, Booking.com CEO Gillian Tans advised Australian hoteliers that from September 1 the world’s largest online travel agent (OTA) will allow hoteliers and accommodation operators to offer better deals they like through most other channels.
Soon after the announcement Expedia has advised it is making the same rate parity changes.
It’s an extension of the policy Booking.com has adopted in Europe, where the anti-competitive nature of rate parity – i.e. contractually obligating operators to charge the same room rates across all distribution channels – has been under pressure from government competition watchdogs, particularly in France and Germany.
In an email sent to Australian operators today, Booking.com CEO Gillian Tans provided details of the “recent agreement” between the ACCC and Booking.com.
“Booking.com has agreed to extend the commitments it has rolled out in the European Union to all accommodations in Australia.”
Here is a summary outlining the changes for accommodation providers:
1. “You may set different room rates and offer different conditions and availability on different OTAs. This means you don’t have to offer the same room rates, conditions and availability on Booking.com as other OTAs.” This gives you greater flexibility to manage your offering across distribution channels.”
2. “You may offer lower rates or better conditions through offline channels (such as telephone bookings and walk-ins) provided you do not publish or market offline rates online. We have had feedback that our partners want the ability to discount through offline reservation channels without having to give us the same or better rates. From now on, we will not require the same or better rates in respect of rooms sold via offline channels, provided that you do not market those offline rates online (e.g. on your website or on meta-search sites).”
3. “There is no restriction on the unpublished room rates or conditions you may offer, provided you do not market those rates online. We understand it may be important for you to offer special rates to your loyal customers through non-public channels (such as closed-user groups) or to negotiate special rates on a bilateral basis (e.g. a special private group discount).”
4. “You are still contracted to give Booking.com parity in respect of room rates and conditions offered on your own website (which includes meta-search sites such as Trivago, Kayak, TripAdvisor or Google Hotel Finder when they redirect the consumer to your own website for booking). We no longer require you to give us the same availability as our competitors, but in order to give meaning to our relationship, we require at least some availability in respect of all rooms and room-rate types.”
“The rest of the contract with you remains unchanged.”
Find out more about the topic in this related Tnooz article.