Leading Meeting Professionals

Professional Convention Management Association

March 23 2015

Is Amazon About To Disrupt The Hotel Industry?

By Corey Domek

 From William Shatner’s “I know a guy” advertisement to Booking.com’s “Booking dot yeah” campaign, online travel agencies are working hard to appeal to leisure travelers, business guests and conference attendees. Now, it seems that the competition in the OTA world is about to heat up thanks to one big name: Amazon.

The rumors of the e-commerce giant’s entrance into online booking first surfaced in November, and now, online users are beginning to cash in on the savings opportunities. From a $109 room at The Heldrich in New Brunswick, New Jersey to a $69 room at the St. Louis City Center Hotel to a $159 room at the La Paloma - Las Flores, Amazon Local offers a range of boutique properties with large savings opportunities. The key word here is “boutique.” According to a report from Skift, Amazon is focusing solely on independent properties. Rather than aiming to partner with major hotel brands, Amazon is dipping its toes into the hotel waters with properties that will be able to benefit from the e-commerce company’s massive existing reach.

SEE ALSO: How Online Booking Sites Could Impact Attrition Rates

Amazon Won’t Steal Your Attendees — Yet

Amazon Local’s hotel offerings are still in their infancy. My recent search of a variety of zip codes surrounding some of the most popular convention destinations yielded very few results. For now, it seems that finding a room next to the convention center will be highly unlikely. However, Amazon has never operated with small intentions. From researching drone delivery that could bypass FedEx and UPS to launching a media player that will take on traditional cable TV, Jeff Bezos approaches every opportunity with a belief that his company can be a dominant force.

Based on the way Amazon is reportedly structuring its deals with hotel partners, properties will be lining up to take advantage of Amazon’s engine. While many independents might pay up to 30 percent for a reservation booked on Expedia, Travelocity or Priceline, Amazon’s terms appear to be much more reasonable. A report from Robert McGarvey at MainStreet reveals that some properties have signed deals with Amazon that only require a booking fee in the neighborhood of 15 percent.

SEE ALSO: How To Protect Your Room Block From Pirates

Worried that Amazon Local might eventually leave some of your contracted rooms empty? Check out “3 Tips For Filling The Room Block At Your Next Meeting” for some helpful advice on how to avoid nasty attrition penalties.

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