The hotel industry maintains steady growth as consumers continue an upward trend of shopping for hotels online and booking electronically, according to TravelCLICK’s 2006 fourth quarter and consolidated full-year eTRAK results. The data shows the total Central Reservation System (CRS) reservations for major hotel brands increased 8.4 percent in 2006, reaching more than 81 million bookings.
Full Year 2006 Overview
The Internet accounted for 38.3 percent of 2006 brand hotel bookings, driven by a 20.2 percent growth rate compared to 2005. During 2006, the Global Distribution System (GDS) maintained steady growth of 5.1 percent, finishing the year generating 35.6 percent of overall transactions, with 29,113,410 bookings. Reflecting the shift of voice callers to other electronic channels, voice reservations decreased 1.5 percent in 2006, now representing approximately 26.1 percent of overall bookings.
Fourth Quarter 2006 Overview
The Internet contributed 38.8 percent, or 7,494,662 reservations, of the total CRS reservations at major hotel brands, a 20.2 percent increase compared to the same period in 2005. The data also highlights the continuing importance of GDS e-commerce with 34.7 percent, or 6,689,926 bookings, of CRS reservations coming through those channels. The eTRAK report shows that voice represents the remaining 26.5 percent of CRS reservations, down 0.5 percent over the same period last year.
In the fourth quarter of 2006, brand websites grew again and continued to gain share compared to third-party merchant and opaque websites, which are increasingly used for hotel rate shopping prior to consumers booking direct on hotel websites. According to eTRAK, brand websites were the source of 83.2 percent of the brands’ centrally-booked Internet reservations.
eTRAK is a quarterly benchmarking report that enables individual hotels to track booking trends on the Internet and GDS through CRS performance. The consolidated results provide industry indications based on performance trends for 21 major hotel brands and chains.
Observations for the market based on this latest data include:
Reservations through the CRS will continue to increase over the next several years, powered by centralization of distribution and revenue management functions.
The GDS will continue steady performance as a result of recent transitioning into a hybrid agent-user interface that offers traditional GDS functionality within a browser-based environment.
As hotels continue to shift marketing funds from offline to online, more bookings will be made directly through hotels’ own websites.
As more consumers move travel shopping online, the voice channel will continue to benefit from knowledgeable and qualified customers, thus increasing conversion rates through this channel.
“The web continues to change consumer buying behavior, and hoteliers are responding aggressively with a shift of strategy and dollars to the electronic world,” said Jeff Bzdawka, Chief Operating Officer at TravelCLICK. “We also expect the evolution of Travel 2.0 to contribute to the growth of online channels, as consumer-generated content increasingly influences travel purchasing decisions.”