Money & Jobs Business Supplement
25th June 2004
The online booking industry is a relative new comer on the tourist scene. Fed by the internet it has gone through strong growth in the last five years. The advantage for clients is that at the touch of a button a wide spread of accommodation instantly appears before them.
The strength of the system for accommodation providers is that their property is displayed on a wider window that either a brochure or direct advertising can offer.
Failte Ireland reports that calls in the last three years – on the domestic market alone – to their associated call centre, Gulliver Ireland, have averaged between 80,000 to 100,000 a year.
Corinne Cullotty, Marketing Manager, Gulliver Ireland says: “Browsers clicking into the Gulliver website – GoIreland.com – can reserve anything from the small bed and breakfast in the rural location, to hostels, guest houses, self catering through to the exclusive five-star hotel in Dublin city centre. It offers the largest database of online bookable properties in the Irish market, over 100,000 in all.” A basic level of quality is guaranteed: “All properties featured have to be Failte Ireland approved.”
The online service accounts for about half of Gulliver’s business. “We estimate that processing to the end of this year should be about 60,000 online bookings,” says Culloty. “The other 50% of the business comes from the contact centre or the tourist information office network system.” Gulliver is linked up to the 70 or so regional tourist offices in Ireland, north and south.
Culloty admits that Dublin accounts for a significant proportion of bookings but “we try to focus strongly on promoting a regional spread to facilitate the small b&b in the rural location or the small guest house.” And she points out the uniqueness of this policy. “There are not too many other intermediaries out there that do that.” Many concentrate on mopping up the sure markets of Dublin, Cork and other large population centres.
Are online bookers likely to be given a worse service than the client who goes direct? Could they be landed with the attic room in a hotel? Certainly not says Pat McCann, Chief Executive, Jurys Doyle Group. “Hotels do not set aside special rooms which have been booked through distribution agents. Under the Trade Descriptions Act you have to make sure that what you’re offering is what’s for sale. In most cases, unless there’s a specific request for a particular type of room, none of the rooms are allocated until the guest arrives. The old system of room allocation whereby you’d have the same hotel room each time you came is long since gone.”
McCann emphasizes that no matter where the booking comes from – distribution agent or direct booking – the price is controlled by the property: the hotel, the guest house or whatever. “Whatever rate the property gives the distribution agent is the rate they must charge plus their (the distribution agent’s) mark-up of course.” But he emphasizes that the best route for the customer is the direct one. “Our policy in Jurys Doyle is to offer the lowest rate guarantee by booking direct. So you should not find rates out there that are lower. And that’s the policy of most international hotel groups. It means they don’t have to pay commission so they pass that saving on to the guest.”
Richard Bourke, President Irish Hotels Federation (IHF) dislikes the growth in booking intermediaries. “There’s a view out there in the industry that they’ve become too greedy. They’re commercial organizations and they want too much of a cut. Generally speaking, intermediaries are looking for inventory from the hotel industry. They want us to allocate space to them and mark it up as they see fit. Theoretically, a hotel gives a room to an intermediary for say €70 and the intermediary can sell it for €100 but it’s the hotel that gets the blame for the €100. There’s a move away internationally from relying on the intermediaries, a movement away from giving them inventory willy nilly. We want to have control over our own inventory.”
The IHF has gone about restoring that control by setting up its own website: Irelandhotels.com. But since it only includes its own members it can only be a partial list of what is available.
Mr Bourke points out: “Our members would make up from 1,400 to 1,500 and they would provide the bulk of the rooms in the country. Most of them are small hotels and registered guesthouses. We will put their inventory up on our website and we will offer the space for them and we’ll take 3% commission which is a very tiny markup.” Mr Bourke adds that the service is non profit making. “All we want to do is to cover the maintenance of the actual website.”