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Metamediaries Forcing Hotels to Adapt

Online travel agencies (OTAs) were among the first to enter this realm. Today, new companies are attempting to compete with the OTAs through a different business model to control the search platform rather than the booking process itself.

1 Comments

  1. michal kusnierApr 7, 2015

    Interesting and very relevant article, it only deals with one component though and is therefore out of the context. From my perspective, one needs to understand that with the emerging paradigm, the entire business model has to be reshaped (not just distribution). You cannot take one thing out of the context, upgrade it and expect positive and lasting results on the whole. In other words, if you do not fix foundations first, fixing the roof will not protect your house from falling. It is my believe that companies without strong, genuine mission that benefits the entire planet (and is therefore much bigger than the company itself) will be experiencing immense pressure in the coming years. To be more precise, business model of the new paradigm questions the status quo, is driven primarily by mission rather than profit, celebrates collaboration rather than competition, sharing rather than protectionism, makes decisions locally rather than globally, replaces smartness with wisdom and takes into consideration intuition rather than just market evidence. To attract and retain best employees it replaces control with creativity and motivation with inspiration. The bottom line is that if you get the foundations right, everything else will fall in place. On the other hand if you don’t start with foundations, nothing can save you. Of course, during the transition period both businesses will coexist next to each other, attracting their own type of work force, business partners and clientele, however the old dog eat dog model is on the decline. Already now it is apparent that to operate a company on this basis is becoming more and more difficult. I would say that for example you at HVS, Barry Sternlicht at Starwood or Chip Conley at Aribnb are getting it and already apply some of the principles of the new paradigm business model…..the rest will follow or disappear.

    • I do agree that this is just one small piece of the growing disruption in the hotel space. However, I believe you are alluding to a larger movement towards a more collaborative business environment. The purpose of my article was to focus on providing awareness of how much these new distribution channels affect hotel profitability at a property level as well as the increasing and long-lasting effect it will have on hotel owners. From my experience, few hotel owners track the cost and benefits of each distribution channel and quantify their effects on the bottom line. As you have alluded to, developing the most profitable distribution mix is not necessarily the key piece of a business that will create the most long-term benefits in light of the overarching, emerging paradigm. Rather, understanding the threat metamediaries pose to hoteliers is yet another argument towards your point. I believe businesses must work together to gain leverage over these new market entrants. The old dog eat dog model has proven to hurt hotel profitability, as property managers have historically chosen to cut rates (especially through third-party distribution channels) in order to steal demand within their respective markets. It seems that this strategy is becoming widely accepted by well-informed individuals as having negative consequences on the hospitality industry as a whole.

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