Consumers Demand More from Airlines' Hotel Booking Offerings

New research from EAN shows airlines could be losing out on ancillary revenue opportunities by only offering basic hotel booking options through their websites

London, 7 November 2012. Research released today from Expedia® Affiliate Network (EAN) reveals a golden opportunity for airlines to boost ancillary revenues through enhancing their hotel booking services. The study[i] of 2,000 consumers in the US and UK, who use online services to book travel, commissioned by EAN, found that less than half of the consumers surveyed (48%) currently book hotels through airline websites. Of those that don’t, almost all (90%) state they would be willing to do this if the offer was convenient or compelling enough.

The research shows that there is an appetite amongst consumers for a richer hotel booking experience from airline websites. When asked about what features consumers are looking for when they search for non-air components to accompany their flight, the top request was package offers and special deals (60%),  with nearly all consumers in the UK and US (91%) expressing an interest in receiving offers on relevant hotels for their trip. Other top features requested by travellers include user reviews on relevant hotels (37%) and suggestions from the site for hotels for their trip (36%).

EAN also examined the most frustrating aspects of booking any aspect of travel through an airline website, with the top three consumer frustrations found to be: hidden costs (51%), unclear pricing (33%) and limited options (25%).

Commenting on the need to meet travellers’ requests for booking accommodation on airline sites, EAN’s Benoit Jolin, VP Product & Marketing, explains, “While most leading airlines now have a functional hotel booking proposition, these findings show there is ample room to improve hotel retailing opportunities and maximise ancillary revenues in this area. Optimising conversion by knowing which hotels to offer to different flight shopper profiles and when, increasing customer touch points and offering hotel deals to enrich the airline loyalty programme  are just a few of the retailing opportunities that can dramatically boost revenues and airline brand loyalty. By not taking advantage of this, airlines certainly are missing out and potentially losing ground on their competitors.”

Jolin adds, “For many airlines, hotel retailing is not their core business, and this sometimes results in a prudent but sub-optimal retail strategy. Co-branding is one example, leading to possible brand erosion and long term revenue shortfalls. Making a hotel suggestion based on flight purchase behaviour combined with an optimised shopping experience can drive additional ancillary revenue streams over time. This can also help optimise search marketing economics. Add to that the ability to offer package savings to flight shoppers, as well as targeted deals and merchandising specials and you are now really fuelling customer retention and extending the airline brand experience.”

About Expedia Affiliate Network

Expedia Affiliate Network (EAN) is part of Expedia, Inc., the world’s leading online travel company. EAN's tools and technology help millions of travellers find the perfect hotels for their next trips. EAN works with over 10,000 partners in 33 countries to turn their web traffic into hotel bookings and happy customers. For more information on EAN visit Expedia, Expedia Affiliate Network, Chameleon and the Airplane logo are either registered trademarks or trademarks of Expedia, Inc. in the U.S. and/or other countries. Other trademarks mentioned herein may be the property of their respective owners. ©2012 Expedia, Inc.  All rights reserved.  CTS # 2029030-50

[i] Research carried out by Opinion Matters on behalf of EAN between 29/06/12 and 06/07/12 with  a sample of 1006 adults in UK and 1002 adults in the USA who had flown anywhere in the last 2 years using online services to book travel.