Post by mdkabila on Mar 11, 2024 0:40:53 GMT -5
We have already talked about the new Airbnb service designed for hotels, but we have not yet focused on how much the news could shake online distribution to its foundations. And not just because of the low commissions: Airbnb plans to distribute hotel inventory in a unique way, offering a model that mixes the agency approach with that of wholesalers. How does Airbnb work for hotels? Airbnb offers a convenient summary in this official document , but we must integrate it by analyzing a room availability search on the portal to get a clearer idea.
Like an agency, Airbnb also requires a decidedly advantageous commission from the hotel , equal in its case to 3% for flexible rates and 5% on rooms sold with strict cancellation terms. Commissions Denmark Phone Number are calculated net of VAT , unlike OTAs which always work on a gross basis. The rate is shown to the customer exactly as it is transmitted by the hotel , without any obfuscation by Airbnb. If it were a pure agency model, Airbnb's convenience would be such that it would dwarf the competition's offering... but it isn't. As mentioned at the beginning, the model is a hybrid with its own characteristics. Coming from the sharing economy, the end customer pays Airbnb first and only secondarily does Airbnb pay the hotel.
Not only that, a "Service Cost" ranging from 5% to 15% is added to the nightly rate and ends up in the portal's pockets, with the hotel having no power over the expected percentage nor seeing a cent of this figure. The thing that makes this hybrid approach interesting is Airbnb's transparency towards the end customer; the user knows well that he is paying for two separate entities: the hotel and Airbnb. Taking service costs into consideration, maintaining rate consistency across all channels including Airbnb becomes a more complex case to evaluate. Which rate to use on Airbnb? If you don't want to offer an unattractive service on Airbnb, it is important not to broadcast the same prices as on other channels, otherwise Airbnb would go overpriced with the service costs. When considering Service Fees and Airbnb's low net commissions, rates should be reduced by a percentage equal to the service fee .
Like an agency, Airbnb also requires a decidedly advantageous commission from the hotel , equal in its case to 3% for flexible rates and 5% on rooms sold with strict cancellation terms. Commissions Denmark Phone Number are calculated net of VAT , unlike OTAs which always work on a gross basis. The rate is shown to the customer exactly as it is transmitted by the hotel , without any obfuscation by Airbnb. If it were a pure agency model, Airbnb's convenience would be such that it would dwarf the competition's offering... but it isn't. As mentioned at the beginning, the model is a hybrid with its own characteristics. Coming from the sharing economy, the end customer pays Airbnb first and only secondarily does Airbnb pay the hotel.
Not only that, a "Service Cost" ranging from 5% to 15% is added to the nightly rate and ends up in the portal's pockets, with the hotel having no power over the expected percentage nor seeing a cent of this figure. The thing that makes this hybrid approach interesting is Airbnb's transparency towards the end customer; the user knows well that he is paying for two separate entities: the hotel and Airbnb. Taking service costs into consideration, maintaining rate consistency across all channels including Airbnb becomes a more complex case to evaluate. Which rate to use on Airbnb? If you don't want to offer an unattractive service on Airbnb, it is important not to broadcast the same prices as on other channels, otherwise Airbnb would go overpriced with the service costs. When considering Service Fees and Airbnb's low net commissions, rates should be reduced by a percentage equal to the service fee .