Cornell Study says Hotel Chains, Travel Websites in Horse Race to Offer Lowest Room Rates

A report published by The Center for Hospitality Research at Cornell reveals that travel websites, still frequently offer the lowest hotel room rates. At the same time, however, hotel chains are using their own sites to gain ground toward their goal of offering the consistently lowest rates.

The report, Why Customers Shop Around: A Comparison of Hotel Room Rates and Availability across Booking Channels, was co-written by Cornell Professor Gary Thompson and Alexandra Failmezger, master's degree candidate. The study sampled rates and availability for 137 possible booking dates in four different hotel segments, as provided on hotel company websites and three travel websites, as well as in telephone calls to the hotels.

Key findings include:

* Travelers face a complex picture of rates and availability of hotel rooms.

* Hotel chains have made considerable progress in offering lowest-cost, last-room availability on their own websites, as compared with sites operated by third parties such as Expedia, Orbitz, and Travelocity.

* Telephoning the hotel is the most accurate channel for determining room availability, but also has the highest cost room rates.

* The chains' websites were reasonably good at ensuring availability, while travel websites, notably Expedia, often showed rooms as unavailable at a given rate, when in fact the room was available through other channels.

“The findings demonstrate the consistency of the hotel chain websites in offering customers the lowest rate, but the fact remains that customers who shop around may find even lower rates,” Thompson said. “Hoteliers who want customers to repeatedly book a particular chain should maintain consistent rates across all channels, so that price becomes less of a consideration in the booking decision. By offering price consistency, hoteliers can encourage guests to focus on other factors in booking, such as loyalty and service.”

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