Price Comparison Widgets: How OTAs Make Them Useless (and Dangerous).

Hotel Distribution

Today I want to put one of those Price Comparison Widgets, or Price Check Widgets, at a test.

I know that someone else already did that, but I wanted to do it in a very different way, because I wanted to show you how these tools not only might be useless, but most times even dangerous.

So, let’s cut to the chase and let’s dig into the case study that I’ve prepared.

Ready? Let’s go.

Price Comparison Widget - Search from the same country

Price Comparison Widget – The search is being made from the same country of the hotel.

This hotel is in Singapore.

I have already opened their booking engine (Synxis Booking Engine) and made a new search: check-in 21st of January for 3 nights, 1 adult.

SBE is popping up with the bottom price of SG$ 126 being the direct price in the Price Check Widget (Triptease), as opposed to a bunch of OTAs with slightly higher prices, SG$128. Let’s round up to SG$ 129.

Now, I have already opened a new tab with TripAdvisor and I already made the exact same search for the exact same hotel, same arrival and departure dates, one adult.

TripAdvisor Same Hotel Same Search

TripAdvisor – Same hotel, same search

As you can see, everything looks fine.

Well, almost everything. Zenhotels is one of those channels I usually refer to as Amoma case, or FIT players, but let’s focus on the big guys like Expedia, Booking.com, Hotels.com.

All of them at SG$129, so perfectly fine. Just like the price check widget is telling us.

Point being, this hotel is in Singapore.

And I am virtually in Singapore, not physically, virtually.

I’m using this tool, called ExpressVPN, a VPN tool to connect to a server located in Singapore, same country of the hotel I’m shopping.

In other words, I am navigating the internet as if I am in Singapore, even though I am physically somewhere else.

Express VPN

Even though I am not physically in Singapore, I am navigating the internet as if I am.

This is extremely important to mention because, as we are going to see in a bit, well, it changes everything.

Let’s put that directly at a test.

So, let’s turn off my VPN.

And as of this moment, every single webpage and site that I will visit, it’s going to be from my actual and physical location, which is Bali, Indonesia.

Besides where specifically I am, enough to note that I am in a different country than the one of the hotel.

Let’s now get back to our TripAdvisor site and simply refresh the page: we can already see that something has changed.

TripAdvisor: Search from another country

TripAdvisor: Search from another country

First off, values are in Indonesian Rupiahs because now TripAdvisor detects me coming from Indonesia and therefore it applies the respective currency.

Plus, Trip.com has now replaced Zenhotels. But again, that’s a relatively beyond that point for now, as we are focusing on the big guys.

Besides, the big guys now show up with different prices: Booking.com and Agoda, more or less the same rate, 1,327 and 1,326 respectively: a tiny difference, probably due to a different currency conversion.

What really matters here is Expedia. And Hotels.com. Now definitely cheaper than, for instance Booking.

Expedia showing cheaper rates

Expedia showing cheaper rates.

 

Before moving forward, let’s also see what the booking engine is telling us the new rates in IDR are, by simply refreshing the page and by changing the currency we want to have rates displayed.

Price Comparison Widget: search from another country

Price Comparison Widget: search from another country.

In a nutshell, the price comparison widget is telling us that all 3rd-party sites have the exact same rates.

Does that reflect the truth? Not even close.

But you might think: “This is just the rate displayed on TripAdvisor, if I click on Expedia, then the final price is going to be just fine.

In fact, OTAs sometimes do so, in order to be perceived as slightly more convenient in the first place, so that they have more chances to get the click by the user and, therefore, chances to turn him/her into customer.

Fair enough, let’s test it.

Let’s click on Expedia and let’s see what the final price is going to be.

In order for it to be consistent, let’s make a three way test clicking also on Agoda and Booking.com: even though Booking.com is not listed in the price comparison widget, it usually shows up with the rate the hotel is feeding them.

This how the respective final carts look like on the 3 channels:

Booking

Booking

 

Expedia

Expedia

 

Agoda

Agoda

 

To wrap up:

Channel Final Price (*1000)
Booking IDR 4,686
Expedia IDR 4,404
Agoda IDR 4,106

Just notice that Booking’s IDR  4,686 is the right price, meaning the rate the hotel has been feeding all channels with.

Keep following and I’ll show you how I know that.

Let’s have a look at the 2 other guys.

Interesting fact, even though Agoda seems to be more expensive than Expedia, it turns out to be ultimately cheaper.

Agoda vs. Expedia

Agoda vs. Expedia

This is because of a 24HOURSALES Coupon that Agoda applied during the booking process: something totally hidden that, as you can imagine, is not being applied to searches coming from the same country of the hotel ?.

Smart, uh?

In summary: 3 channels, 3 different rates.

That’s not it, of course not.

Please, take note of what I am about to say: if you will ever see Agoda being really in parity, meaning offering rates as it is supposed to, that is definitely a bug.

I really mean it.

I usually refer to Agoda as the bad guy of the Priceline family, as opposed to Booking.com, who in turns is the most transparent, yet biggest, OTA worldwide. (I talk about it in this article too: Hotel Distribution Today and the Ikea Effect).

Let’s make another search.

Exactly the same as before. This time though, on Google rather than TripAdvisor:

Search on Google - same hotel, same dates

Search on Google – same hotel, same dates

Hotels.com, same family as Expedia, being in parity with Booking.coma and Agoda.

In other words, Google is showing different rates than Tripadvisor, despite we are looking at the same hotel, for the same dates, same number of pax.

Besides, let’s focus on Agoda now.

Remember, the previous search on Agoda via Tripadvisor: IDR 4,106.

Same search, via Google: IDR

Agoda via Google

Agoda via Google

 

OTAs are above your Price Check Widgets.

Point being, you’ve probably been sold on the idea that these tools are so accurate, that they can track the IP address of the uses who’s making the search. Thus, track the price that has been offered to that user.

But, as you have just seen, the country where the search comes from, is not the only variable that defines what rate he or she is going to see.

This is a conceptual and an operational problem, not a technical glitch that can be fixed.

These guys can not tell what the price is that I’m getting respectively from Agoda, Expedia, Hotels.com, etc.

 

Direct-Booking Rate… & Expedia.

I’m not done yet ?.

Let’s also see what the total rate of a direct booking through the booking engine would be, in IDR, so that we can compare with what we have seen so far, and assess what the cheapest channel is.

Direct Booking Rate - Booking Engine

Direct Booking Rate – Booking Engine

Have you noticed how every single search we have made, resulted in a different final price?

I understand you might feel confused, so, here’s the updated pricing table with all the pricings we have just gone through:

Channel Final Price (*1000)
Booking IDR 4,686
Expedia IDR 4,404
Agoda via TripAdvisor IDR 4,106
Agoda via Google IDR 4,683
Synxis Booking Engine IDR 4,581

4 channels, 5 searches, 5 different rates.

Expedia: in a nutshell, the price you are looking at (IDR 4,404) is cheaper than it is supposed to be.

If we follow the same principle we applied before with Agoda, this IDR 4,404 from Tripadvisor may ultimately be different if we change the source (TripAdvisor).

Let’s try another way then.

Not Google, as we did with Agoda before, but direct on the Expedia site: we simply open a new tab and type Expedia.co.id.

Finale price, same as the one coming from Tripadivsor, IDR 4,404:

Expedia

So, you might tend to think, “Okay, these are the rates the hotel has been feeding Expedia with”.

In a single word: no, it’s not like that.

This is because of the Expedia SHPM system. I talked about it in this other post >> SHPM: The Hidden System by Expedia to Undercut Hotel Rates.

If you haven’t read it yet, please do, as it explains how it works, how your hotel rates might be affected, too. And, more importantly, what you should do to fix it.

After clearing my cookies, new tab, new search, same hotel, same dates:

Expedia Direct Price

Expedia Direct Price.

Again:

 

Channel Final Price (*1000)
Booking IDR 4,686
Expedia via Tripadvisor IDR 4,404
Agoda via TripAdvisor IDR 4,106
Agoda via Google IDR 4,683
Synxis Booking Engine IDR 4,581
Expedia (direct) IDR 4,685

You remember what I told you about Booking.com having the right price?

Now compare with the Expedia direct price.

 

Useless. No, Dangerous.

Assume I am the GM of this hotel in Singapore.

Whilst you are a prospective customer of mine, and when you end up visiting my hotel across multiple channels, you are being offered with such a messy scenario I just guided you through.

Considering that:

  • first, you see Expedia on Tripadvisor at $ 100;
  • then, as a result of the billboard effect, you happen to see my hotel site direct price, at $ 110;
  • finally, my price check widget tells you that Expedia sells my hotel at $ 120, (but you have just seen it at $ 100).

How would you feel?

You’d probably think that I am a liar.

Feeling this terrible feeling, I guess, not only would you give up on booking directly on my hotel site, but you’d rather stay away from my hotel, completely and forever.

Lack of trust and lack of transparency can’t be recovered.

 

The right Context.

I just want to make it clear: I am not telling you to give up on your price comparison widget.

Yes, I admit it, I am definitely NOT a fan of these tools, never been.

I learnt on my own skin to stay away from those that seem tools that do the magic overnight. Because I don’t believe in magic. Nor in shortcuts.

What I’m doing here is very simple: I’m proving facts. Period.

And the facts say that, eventually, these price check tools might be useful and helpful, ONLY if placed in the right context.

Translated: right context = healthy distribution.

If not, please, stop buying on the idea that some magical provider can come to your hotel, offering a magic tool, eventually at a magical price… that does the magic overnight.

 

My suggestion.

I have only 2 things to suggest:

  1. get yourself a VPN tool. As said, a VPN is a tool that allows you to connect to other countries in the world, to see whether sites (OTAs) show different things depending on the user’s location. The VPN I have been using, ExpressVPN, just like many others, is very cheap, around 6-7 USD per month. You can use it on as many devices as you wish, as long as no more than 3 people use it at the same time.
    Just don’t tell me that you don’t have budget to spend for it. I mean, seriously…
    Since I am already a customer of ExpressVPN, as part of their referral program you can use this link to sign up and you will be granted with additional 30 days of their money-back guarantee (btw, I don’t earn any money out of it ?).
  1. clear your cookies, regularly. In my other article re the SHPM system by Expedia I explained the steps to do just that, individually for websites.

The 2 points above can simply be summarized with get back control of your hotel distribution.

Big Hug.

Ale.