A day at AGHZ – Deutscher Hotelkongress 2013

As every year, AGHZ (Allgemeine Hotel- und Gaststättenzeitung) invited hoteliers and restaurateurs to attend the German Hotel Congress (Deutscher Hotelkongress) and Hotelexpo. The event took place at Maritim Hotel Berlin at the end of January 2013. Several subjects were covered in presentations and podium discussions throughout the duration of the conference – from Human Resources to future trends in hospitality and gastronomy. We attended the distribution conference at the end of day two and here are some of our impressions.

Three hoteliers spoke about the difficulties in present day hotel distribution and the shift from traditional  to hotel online distribution which finally seems to be taking place in Germany as well.

For example, the Freizeit In Hotel Göttingen – an event and wellness hotel – will spend 35% of their total marketing budget in 2013 online.

Slide reads: “We invest in Online Marketing – now!”
Olaf Feuerstein, CEO, Hotel Freizeit In GmbH

At the same time, online distribution via OTAs was highly unpopular amongst the presenters because of commissions to be paid and the fear to loose control. OTAs constantly change their cooperations and it would be nearly impossible for a hotel to unravel and stay on top of the complexities of online portals.

Jürgen Gangl, Area Manager at Event Hotels Berlin showed that there is a profitability loss of 25% to 45% when hotel rooms are being sold via OTAs.

Profitability Loss of 25 – 45% when selling hotel rooms through OTAs
Jürgen Gangl, Area Manager Event Hotels Berlin, Esplanade Berlin

Direct distribution via the hotel’s own website is much cheaper, even when marketing costs are taken into account since there is no OTA commissions. The share of the room rate staying at the hotel would be more than 75%:

Profitability Loss of less than 25% when selling hotel rooms directly online
Jürgen Gangl, Area Manager Event Hotels Berlin, Esplanade Berlin

Similar stats were displayed by Marco Nussbaum, CEO of prizeotel Bremen with the direct online distribution channel also being the most profitable:

Share of rate staying at the hotel: web direct, retailer, GDS, merchant, wholesaler
Marco Nussbaum, CEO und Mitgründer, prizeotel Bremen GmbH & Co. KG

All presenters were clear that selling rooms via the direct channel, i.e. the hotel’s independent website would be the way to go.

However, difficulties of this approach would be a professional web design, guests finding the hotel website in search engines, i.e. search engine optimization (SEO) and the new Google Travel ads of Google Hotel Finder where ad costs had increased considerably over the past months.

Any hotels wishing advise on these issues, please contact us here.

More information about the event at: www.deutscher-hotelkongress.de

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