iahphx

This question is mostly aimed at folks who do a lot of European travel.

Few people know it, but booking.com is one of the highest market-capitalization travel companies in the world. This Dutch company is actually owned by Priceline.com, and accounts for almost 9/10ths of Priceline's profits. The market cap of Priceline is now more than $32 billion which, for example, is more than the entire US airline industry combined.

Outside of Wall Street, though, few Americans have ever heard of booking.com. It's website doesn't look particularly impressive and American travellers tend not to get terribly excited by online travel agencies anyway (since they don't really "do much" for you as a traveller, at least in the USA).

So what about Europeans and booking.com? It does look like booking.com offers more small hotels than competing travel agencies. Are the prices good? And is it better to book with them than direct with the hotel? And are there other European travel agencies who offer something similar?

I understand that hotels have to pay booking.com a 15% commission, which seems rather high, and would make me think that both traveller and hotel would prefer to avoid this middleman. Is that not the case, though?

Any insight in to why booking.com is or isn't better than other online travel agencies would be very helpful to me, as (for investment purposes) I'm trying to understand the company better. Thanks!

tatterdema

Booking.com also has issues with selling rooms that are not actually available, at least here in the US. The hotel I work for quit using them about a year ago for this reason, and I know of several other hotels that have also done so. I think it had to do with real time availability, etc. Many times people would show up to the hotel, and not have a reservation. They would have a confirmation from Booking.com, but the reservation never made it to the hotel. This is just my own experience with them. Never used them to actually book a hotel.

nacho

I used to like booking.com a lot (before I discovered FT), and actually booked hotel with them a couple of times. Since I started FT I stopped using it because I won't get points for staying at e.g. Marriott. They have a big coverage of hotels, the site lists hotel policy very clearly (having 3 small kids travelling with us we need to know if we all can squeeze into a room without problem).

A handfull of times I used the site for Marriott LNFs, but for price wise they are not any cheaper than other online booking agencies. Very importantly they don't offer cash back and any kind of loyality programme. So if you'd like to book a hotel and see it somewhere else at the same price - would you still book from booking.com?

iahphx

Interesting responses, thanks. The problem with not having a confirmed reservation is curious. Do you think most of the mistakes are made by booking.com or by the hotels? Unless the hotelier was loading incorrect data (or, more likely, not updating it), why would booking.com sell a room that wasn't available?

It does seem pretty obvious to me that the main thing booking.com "brings to the table" is online, immediate booking of smaller hotels. Like if I'm looking for a room in a small town in Germany, booking.com might have 2 dozen listings (often for smaller, less expensive hotels) and other websites might have 3 or 4. You can see this if you look on an aggregator site like kayak.com. I would think that a traveller who was in a hurry or didn't feel comfortable knowing how to contact the hotel direct would use booking.com to make these reservations. And perhaps other hotels in these towns who saw their competitors listed on booking.com would feel like they should participate, too (even if, perhaps, they didn't like paying a hefty commission for the booking).

For many reasons, this doesn't strike me as the greatest business in the world -- and I don't see any barriers to entry of other online travel agencies doing it -- but it seems like that's their primary advantage now: small hotels that you can't easily book online any other way.

nacho

Yes they do list out tons of small guest houses in Germany, but when you look into the details a lot of them don't take credit card. They take EC (German payment card) or cash - they are very primitive privately owned hotel. Put it this way I'll never book those place even though Mr. Nacho speaks German.

iahphx

What's wrong with small hotels? If they get very good reviews, and the price is right, I'd take a chance.

I'm just not sure why I'd use booking.com for my reservation.

glennaa11

I believe they also provide booking engines for some of the independent/small chains in Asia I have stayed with. Booking direct through the hotel's website ends up being indicated as booking.com

tatterdema

The people that I know that do use booking.com, use it because they do not take any money up front, and most hotels are cancellable. Where as you have to pay up front for Expedia.

On the flip side, since they do not take payment up front, they FAX your credit card information to the hotel, along with mailing address, etc. Personally I would rather pay up front and have my info more secure.

15% commision is not a lot compared to what Expedia is paid. But then the exposure is not near as good either.

I really would not hesitate to use Booking.com if they had what I was looking for at the right price. But they normally dont offer me anything I cant find somewhere else easier.

iahphx

Thanks. Well, yeah, that's my question. The USA stock market is pricing this company as if booking.com DOES offer something very special. I'm trying to figure out what that is!

nacho

From what I have seen, those small places normally requires a deposit, and not sure those reviews are real. I wrote some reviews at TA at hotels that I stayed in and they got rejected for no reason. I have stayed in hotels that are highly rated by TA and got disappointed. TA was good about 2years ago but now I think it's getting too commercialised.

It's true that booking.com sells a lot of small hotels that no other major hotel sites does. Those German B&B are normally available through German sites and if they sell through booking.com they could reach more potential customers.

Another thing I like about booking.com is they state hotel policies very clearly, even better than the hotel's own page. We have 3 small kids and we don't want to rent 2 rooms so browsing through booking.com would give us an idea if it's ok that we all stay in 1 room.

atleast10hats

I have a small B&B in Pennsylvania and began listing my property with booking.com last July when they solicited my business - it was free and commissions were only charged on reservations made and kept. I also have a business listing on Trip Advisor which cost several hundred dollars but does not charge a commission. Both websites have brought significant new business to my B&B.

TA brings mostly new US visitors. Booking.com brings many new USA guests but also has increased our foreign visitors from less than a handful a year to about 20 in the 9 months since our listing went live.

The difference in Trip Advisor reviews and booking.com reviews are that only people who have made a reservation through booking.com and actually stayed at a property may post a review to booking.com which is solicited by booking.com after the guest stay - whereas, anyone can post a review to Trip Advisor. There is NO mechanism to determine if the reviewer ever set foot on the property they are reviewing making their system subject to artificial manipulation from competitors or supporters both - though TA says their software prevents most fake reviews from appearing. However, as a counterbalance to fake positive or fake negative reviews, TA allows management to respond to reviews and booking.com does not.

As for deposits....let me weigh in from a small property owner's point of view. In twenty years of running my B&B I had never required a deposit to make a reservation. But after a few months of receiving reservations through booking.com I began to understand that some people making reservations with "no skin in the game" treat the reservation as if it was made with huge hotel chains - reservations casually made and just as casually discarded. Several people reserved one of my 3 rooms many weeks in advance of their stay. I turned down multiple requests to hold the room for them, only to have them cancel on the last day to do so without a charge. I now require a 20% deposit for the first 3 days of a reservation.

In the 9 months since listing with booking.com, I have had 56 reservations of which 14 were cancellations....but only 1 cancellation since I instituted the deposit requirement. The reservations made are somewhat fewer....but those making them are not doing so frivolously so the number of reservations that actually take place has remained steady.

As to nacho's rejected review....TA has some funny guidelines and it could have been something quite innocent that caused your review to be rejected. On one occasion I submitted a management response to a very positive review a guest left for me on TA. I mentioned in the response my appreciation of the information the guest had shared with me about their hometown of Williamsport, PA and the Little League World Series. The response was rejected because apparently the mention of that (even though the event is in the guest's hometown and not near my B&B) was considered promotional.

The comments about not trusting small properties really makes me smile and shrug. In twenty years we have hosted thousands of guests from all over the world and have loved doing so. Based on reviews from our guests, the feeling is mutual. Do your homework in checking reviews but don't be afraid to try a smaller property - you will likely be very pleasantly surprised.

iahphx

Thanks, hats. Your perspective is interesting.

I'm a bit surprised that tripadvisor hasn't gotten you foreign clients. They have websites all over the world in many languages.

Do you participate with other online travel agencies? Why or why not?

And, if you don't mind telling us, what commission do you pay booking.com, and do you consider it fair? And if guests book direct, do you offer them lower rates?

FlyBalletGuy

I've used booking.com frequently for the reason mentioned above - cancelable reservations. And as atleast10hats noted, I've used them for backup reservations that I later cancel if I've been able to beat them. Recently, though, I used them for a small property in Istanbul. I made one in Vienna, but found a better deal almost immediately after at the hotel's own website (the hotel offered a "single occupancy double" rate that booking.com didn't.) Booking.com is very clear about the rooms offered, including size in sq. feet or meters and included amenities and other costs (including wi-fi) So it's often one of the first places I check.

Steven Avery

Hi,

Ironically I saw that some hostel companies have a nice system of actually taking a 10% non-refundable deposit. On a two-day private room that might be under $10. Enough to avoid a lot of vapid bookings made with little intention of use, but not so much that if your plans change (stay with friends, go upscale) you would be particularly upset. It can act as your first-line assurance, that you know you have a reasonable room in your name.

The hostel booking company even has an insurance thing for a fraction of that, so if you cancel ahead of time properly, then credits even that deposit into your hostel (world or bookers, one or both) company booking account (remember, these places book B&B, small hotels, etc. also). So if you use the small bank in another booking you only lose maybe $1 a day, the cost of the insurance.

Seems like all this is a nice compromise. Generally, I don't book hotels so I dunno if the hotels themselves or the big hotel booking companies can do similar on web reservations. However it seems like this would solve a lot of the problem (the booking company could give the hotel or B&B the option to insist on the small deposit). Granted more is involved in a $150 room for a week, so the numbers might have to be a bit different (maybe 5%, maximum loss, $50 or $100).

I realize all this might exist already .

Steven

nacho

I dislike the deposit system because:

a. I really dislike being so tie up with a reservation, especially if it's booked far in advance and you are travelling with small children; Or you are on a road trip and suddenly you got stuck due to bad weather.

b. I don't like to pay 'forex' fee twice in case I cancel a reservation.