A Big Change at Expedia
Expedia's new Search and Sort Factors - What does it mean for my business?
Big changes are coming to the way Expedia lists hotels and how the order of properties is determined.
Barry Diller, the Chairman of the Expedia Group proclaimed to 3,000 of Expedia’s travel partners, (hotels, short term rentals, airlines, cruise lines, ground transportation, etc.) at the Explore 22 convention in Las Vegas in May – “We finally got it right, after 25 years”. In the words of Vice Chairman and CEO, Peter Kern, they have “allowed the market to become commoditized by price” and they “offered the cheapest alternative to travelers even if that wasn’t what they were looking for”.
It seems that they have finally come to the realization that it is more about experiences than price alone and that if guests have expectations met, and indeed surpassed, this creates happier guests and more loyalty than simply the cheapest hotel stay. None of the initiatives launched in Las Vegas have been fully implemented to date and we cannot ascertain exactly when this will happen but the new strategy for listing hotels will begin to impact placement order on all Expedia managed sites in August 2022. There was finally an admission at Explore 22 that placement was historically due to price and money alone. It is what we have all known for years. If you give Expedia the lowest rates, take part in their promotions and campaigns, (offer lower rates still!), sell through all their channels, offer additional discount to Expedia Members and further increase their margin/commission with other programs you will be rewarded with higher placement.
Multiple members of senior Expedia management declared that from now it was going to be all about guest experience with the hotels offering the best guest experience receiving the best placement.
Obviously, hotels would have to maintain competitive pricing, but guest experience is what it is all going to be about.
On the same day this was announced, all partner hotels saw a new addition to the front page of Expedia Partner Central quoting numbers for Guest Experience and Offer Strength.
While this was available to hotels on this date, it would not become used in the sort order until 90 days later to give us all time to “get our houses in order”. It was made very clear how the Guest Experience Score was calculated with six specific areas. The first four from guest reviews: Cleanliness, Staff & Service, Amenities, and Property Conditions & Facilities. The last two from Expedia being Relocations and Refunds. More items are likely to be added in the future.
The Offer Strength was described in a much more vague fashion and primarily focused rate parity with other sites. As of August, these factors will start to impact hotel placement and the Guest Experience Score will show in the listing so all potential guests can see it before making their choice of accommodation. Further, hotels will be shown as a number in their market based on Guest Satisfaction Score. This will be similar to what we have seen on TripAdvisor for many years with the main difference being that the Expedia score covers only the last 90 days whereas a renovation in 1999 which caused guest dissatisfaction will still impact the TripAdvisor score today.
So, that’s all very clear right?
Wrong. We are now told that the scores and rankings appearing on the listings has been delayed and will not appear in August but it will affect placement order regardless. It has never been clear how much placement will be impacted by Guest Experience rather than Offer Strength or indeed exactly what Offer Strength means. You will recall the evil old matrix referred to earlier which rewarded all those price and money items. It is now increasingly clear that this has morphed into Offer Strength with little or no changes.
Thus, despite all the protestation in Las Vegas, we are still working with our client hotels on ensuring a level of involvement in Expedia programs until we can see concrete evidence that we can maintain placement without it. There is no question that every responsible hotel operator should focus on great guest experiences regardless of Expedia or any other third party. Even if there are limitations caused by plant issues such as an overdue refresh or local factors impacting visitors, properties can overcome a multitude of sins with exemplary guest service, and this is not necessarily reliant upon increasing costs.
We will watch the continuing evolution of the new Expedia strategy with our customary mix of skepticism and hope. We are not ready to agree that they “finally have it right” but we will give them the opportunity make us believers over time.
Vice President, COO