Booking.com is a major player in the online accommodation booking sector. The platform offers a wide choice of hotels, flats and other types of accommodation around the world. However, it is important to understand how Booking.com uses hoteliers' brand names to attract customers and generate revenue. Here we explore how Booking takes advantage of hoteliers' brand names by bidding on the keywords of campaignand how this can be detrimental to hotel establishments.
How Booking.com uses Google Ads
Booking.com systematically uses Google Ads, Google's advertising programme, to promote the accommodation available on its platform for all or almost all of its customers. Bidding on brand names is a common strategy in the online marketing sector. It involves bidding on keywords that contain a competitor's brand name. By bidding on keywords linked to a hotel's brand name, Booking.com is able to position itself at the top of the search results, capturing a significant proportion of the traffic that might otherwise have been directed to the hotel's official site and thus acting as a direct competitor to their own customers.
This practice is particularly effective as internet users are often looking for information or rates for a specific establishment and can therefore be easily encouraged to click on the Booking.com advert rather than the hotel's official website. Once on Booking, the user is channelled into a search funnel that extends their search to other competing hotels in the direct vicinity.
Impact on hotels
The diversion (questionable in moral terms, admittedly, but legal) of some of the traffic that could have been directed to the hotel's official website has a number of negative consequences for hotels:
- Cost of commissions : Booking through Booking.com generates commission for the platform. If guests book directly on the hotel website, these commissions are avoided. Commissions can represent a significant proportion of a hotel's revenue and reduce its profit margin.
- Limited control over bookings Hoteliers have limited control over bookings made via Booking.com, which can lead to communication and management problems. For example, hoteliers may find it difficult to manage special customer requests, modify bookings or resolve overbooking issues.
- Reduction in customer loyalty Customers who book via Booking.com are less likely to develop loyalty to the hotel brand, as they interact primarily with the booking platform. This means that hoteliers are less likely to retain these customers and encourage them to return for future stays. What's more, guests who book via a third-party platform may not be enrolled in the hotel's loyalty programmes, further limiting opportunities to build loyalty.
- Unfair competition Brand name auctions can be seen as unfair competition, as they exploit brand awareness to attract customers. Hoteliers invest time and money in building and maintaining their reputation, and this practice can be seen as unfair exploitation of these efforts.
How hoteliers can protect themselves
Faced with this situation, hotels can adopt various strategies to protect their brand name and reduce the impact of bidding on Google Ads keywords:
- Bid on their own brand name via a targeted Google Ads campaign Hoteliers can also use Google Ads to bid on their own brand name and position themselves above Booking.com's results. This can help to recover some of the diverted traffic and reduce the impact of the booking platform's auctions. However, it can also lead to higher advertising costs for hoteliers.
- Optimising natural referencing (SEO): By working on optimising their website for search engines, hoteliers can improve their ranking in natural results and attract more direct traffic. This involves working on site structure, content quality, inbound links and other key factors that influence a site's position in search results.
- Offer benefits for direct bookings: Encouraging guests to book directly through the hotel website by offering benefits such as discounts, upgrades or free services can encourage guests to avoid third-party booking platforms. By clearly communicating these benefits on their website and communication channels, hoteliers can encourage more guests to book direct.
- Monitoring and reporting infringements: Hoteliers should monitor Booking.com's advertising campaigns and report any misuse of their brand name to Google. If Google believes that Booking.com's advertising practices violate its policies, it may take steps to limit or remove the ads in question.
Booking is useful and sometimes even necessary when it comes to filling additional rooms, but it comes at a price. It is essential for hoteliers to take steps to protect their brand name and reduce the impact of bidding on Google Ads keywords. By adopting strategies such as bidding on their own brand name, SEO optimisation, offering direct booking benefits and monitoring for infringements, hoteliers can mitigate the negative effects of Booking.com's advertising practices and protect their revenue.
It is important for hoteliers to keep abreast of developments in the industry and the practices of online booking platforms. By understanding the strategies used by Booking.com and taking proactive steps to protect their brand name, hotels can improve their online visibility, build customer loyalty and increase revenues in the long term.
Finally, it is essential to educate guests about the benefits of direct booking and inform them about the advertising practices of online booking platforms. Educated guests are more likely to choose to book directly with the hotel, helping to protect hoteliers' revenues and strengthen brand loyalty. By focusing on transparency and communication with guests, hoteliers can create long-lasting, fruitful relationships with their customers and ensure the long-term success of their business.
