ALIS LIVE: OTAs Take Center Stage

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There was Gary Fritz, president of Expedia's Partner Services Group, front and center on the opening panel of the Americas Lodging Investment Summit Monday. He offered a glimpse into the statistical information his online travel booking website had accumulated, sharing the stage with industry analysts and economists from Colliers, STR, Deloitte & Touche and Scotiabank Group.

Expedia was an unusual addition to the traditional panel of industry experts. But the OTAs, and Expedia, in particular, have taken so much heat from hoteliers, both from franchisees and the major branding companies, that it seemed Expedia was here playing nice. Friend or foe is often the question asked of OTAs, and Expedia was here to say “friend.”

Fritz, and Melissa Maher, Expedia's vice president, strategic accounts, who oversees the company's lodging portals, also made their rounds with the hotel press. The duo admitted that it was natural to have some tension in the relationship, but that Expedia was a tool available to help hoteliers sell rooms. Less than two years ago, Choice Hotels had a well-publicized spat with Expedia in 2009 and Choice briefly pulled its inventory from the OTA before settling the dispute.

Fritz said the lesson learned for Expedia was “that we need to do a better job explaining to our chain partners that we're not competing over the same customer.”

I asked him if he thought there could be a Southwest Airlines in the hotel industry, a brand or company that could forego OTAs and succeed with direct bookings only, but he said the industry was too fragmented. I asked what would happen if a brand pulled out completely, and he said they could survive and it wouldn't be crippling to either side, but he doubted it would ever come to that.

It was the same message touched on during the brand leaders panel later in the event, when Marriott's Arne Sorenson, Best Western's David Kong and Starwood's Frits van Paasschen agreed that there was too much competition in the industry for anyone to be successful by foregoing the OTAs.

Kong made a great point that hoteliers need to “strip away the complexity of distribution and focus on hospitality, and we can all be more successful.”

OTAs aren't going away anytime soon, so whether they are a friend or foe, hoteliers need to figure out how best to work with them while maintaining a focus on the core: hospitality.

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