Google’s latest hotel ads changes has some huge winners and losers
Just this week we had some exciting news that now Google will always show some of the Google Free Links on the front page of Google
The best part is that it is FREE.
When you search for a hotel using their name in Google Search, you will see their prices on the right hand side.
The hotel “Official Website” always gets the No1 spot!
The Winners
Obviously Hotels are a huge winner here, to get top placement in the “Other” section without cost is amazing.
Hotels
Previously to get shown on Google Hotel Ads on the front page you could be paying 100s or 1000s each month and potentially without any ROI. Now it’s free there is no risk to participate and the consumers see all the rates available. Also the placement is very prominent and has a bonus title of “Official Website”.
Guests
Guests are huge winners here, now there is one place to look for all the best prices available including even the hotels direct rate. Other websites like Trivago don’t don’t include the hotels websites prices usually so this is a huge advantage.
Hotel Booking Engines
Someone needs to power the Google connection and that is called the booking engine, the hotel booking engine has suffered a long time because of the dominance of online travel agents like Booking and Expedia. Now it’s time for their huge comeback in importance.
Yes Google is a big winner here that it becomes even more popular (if that’s possible) and get much more data in the form of hotel direct prices.
Now onto the losers and there are some painful losers here…
Who loses in this change?
Trivago and TripAdvisor
It’s no secret they have both been losing to Google for years but this will be another nail in the coffin. Google will soon hoover up all the hotels direct rates and show to the consumers, these websites will not be able to match that unless they also offer free links to hotels also.
Online Travel Agents (OTA)
Showing the hotels direct rates in comparison to the prices on the OTA will cost them conversions and bookings while also at the same time increase their ad bills. I see some heavy handed threats to hotels who sell cheaper on their website but this also comes with an anti competitive risk from local governments especially in the EU.
Meta Search Players
There are companies that connect hotels to Meta Search websites like Google, Trivago and TripAdvisor. Only large hotels can afford these services. With the whole market being dominated by Google and also no huge need to pay for placement, it’s hard to see why hotels should pay big fees and pay for adverts anymore. I see a lot of hotels just needing the free placement and putting budget behind better prices for direct bookings.
Commission Programs
There are “Demand Plus” commission programs offered by some big hotel tech companies where they offer to advertise your hotel on Google for a 18% commission. These are money printing machines even before these changes and now they will go into overdrive since most of them still charge the 18% even if the booking came from a free link.
However this 18% commission service will die off in popularity when the hotel finds out it can be free and especially when they could put some discounts into direct bookings instead of paying a tech company for some ads at extortionate prices.
Conclusion
Overall the hotel and guests win big here and large tech companies lose out, can’t complain with an outcome like that.
