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5 years ago
 

Hotel giants come together to launch Room Key search site

Massive development in the hotel sector with six of the biggest hotel chains on the planet uniting to launch Room Key, a new online hotel search platform.

Choice Hotels InternationalHilton WorldwideHyatt HotelsInterContinental HotelsMarriott International and Wyndham Hotel Group have combined to establish the joint venture under the leadership of CEO John Davis, founder of the Pegasus hotel distribution and technology service.

The site is essentially a metasearch platform for properties, prices and availability across all six companies, including their sub-brands and affiliates.

Users can browse rates across every property, read independent reviews, compare prices and share information around their various social networks.

The site is global and has enlisted ex-Hostess Brands SVP of marketing Stephany Verstraete as its chief marketing officer and J Kurt Zimmer (a former TIAA-CREF and Dupont IT executive) as chief technology officer.

Ahead of the launch, RoomKey bought accommodation site Hotelicopter to run the search technology behind the scenes as well as continue to provide its affiliate platform for destination marketing organisations, under a division known as Room Key Solutions.

The formation of the Room Key venture comes as the hotel sector continues to battle with various issues around distribution and pricing on the web, including the continued roll-out of Google’s Hotel Finder service (which many of the above brands participate in).

Davis says:

“Finding the right hotel is complex and, unlike booking a flight or reserving a car, it is a personal decision process – one which no one understands better than hoteliers.

“We believe Roomkey will provide consumers with an innovative resource that will give them unprecedented confidence in their booking decisions by fulfilling their hotel search needs, with comprehensive and trusted content, and over time, through additional features such as the ability to connect and share their plans with family and friends – all provided through a simple and flexible site experience.”

Collaborative efforts on the web by major hotel chains, similar to those that saw the formation of Orbitz and Opodo by the airlines, are not exactly new.

In April 2001, European trio Hilton, Accor and the Forte Group joined forces to launch AndBook, a search and booking service featuring properties from all three brands as well as accommodation on the Pegasus platform.

AndBook’s creation had to be validated by the European Union, due to competition concerns, but it was expected to become a significant player in hotel search.

It eventually failed to gain any significant traction as it suffered, similar to many travel brands at the time, from the downturn in tourism in the wake of the September 11 2001 terrorist attacks in the US.

The Forte Group was also broken up shortly after AndBook’s launch.

In the US, Travelweb was a web distributor of merchant hotel rooms in the early-2000s, formed by Hilton, Hyatt, InterContinental Hotels Group, Marriott, and Starwood.

Travelweb’s other part-owner Priceline took over the remaining 71% shares in the business in 2004 for $21 million, eventually folding the system into the main Priceline brand.

Room Key, however, arrives in a very different era in hotel distribution and marketing, with more channels than ever before and the emergence of big and potentially very influential players, such as Google.

The normally-fierce rivals are crawling over themselves to talk up Room Key, with it being described as “unique” (Chuck Sullivan, Hilton Worldwide), “well positioned” (John Wallis, Hyatt), an “industry first” (Steve Sickel, IHG), having “immediate scale” (Shafiq Khan, Marriott) and promising “clear benefits to the industry and consumers” (Flo Lugli, Wyndham).

NB: Further details here in this interview with Davis.

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Kevin May

About the Writer :: Kevin May

Kevin is senior editor and a co-founder at Tnooz. He was previously editor of UK-based magazine Travolution and web editor of Media Week UK from 2003 to 2005.

He has worked in regional newspapers (Essex Enquirer) and started his career at the Police Gazette at New Scotland Yard in London. He has a degree in criminology, a postgraduate diploma in magazine journalism and publishes his first book - a biography about Depeche Mode - in early-2017.

 

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  15. Robert Gilmour

    These are global hotel industry leaders in thought and action, and i’m sure they’re doing it for very good reason and know what they are doing, and doing it for.

    To me its an absolute no brainer, I’d heard it discussed in the corridors of power for some time n ow, and it was only a matter of time, I’m amazed its taken so long.. it will get enhanced and refined, and as these hotel groups are commercially obsessed with lowest rate guarantees on line (and so they should be), it will ultimately be honed up for maximum channel shift away from OTA’s, I suspect just watch this space. I know from discussion with these groups that that’s where they ultimately want to be.

    For the travel shopper, its a more commercial and logical addition to their on line armoury than a lot of what else is going on out there in the market. I wish the project well.

    Also i’m not really expert enough to criticise the joint actions of 6 world class hotel groups and Pegasus, that’s way too potent a combination for my small ,mind!

     
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  18. Myanmar ICT | Six Hotel Giantss’ Hotel Search Engine

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  19. Tim

    Does not matter how good the product is (and it looks nice – I was an early fan of VibeAgent/Hotelcopter). What matters is how they will market themselves. Customers have thousands of places to go to book the major chains. All at the same price (if BAR rules are to be believed). Many of those places (Orbitz, Expedia, Booking etc) are spending hundreds of millions of dollars on marketing or have loyalty bonuses and have large customer databases. So two questions for RoomKey

    1. How do customers know you exist? What marketing advantage do you have to combat bigger brands with more money?
    2. Given BAR, why would customers use you over any of the other 999 options for booking your partners?

    I dont see an answer to either of those questions in any of the press release materials

    I like the site – but good product is no longer enough

    Signed the cynic from down under

     
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    • Guillaume

      Just saw this now! Duh! All makes sense. I was suspecting the team will be absorbed into this new venture. Cheers Kev!

       
  24. Wing Tip

    I particularly love the star ratings system. Instead of showing stars they are showing a bar chart with the number of hotels available in that star rating. I’m looking at Chicago hotels and because of the heavy amount of three star hotels the chart looks like its flipping me the bird. Nice touch – and is only one way that these guys have shown that they are out of touch with truly innovative design.

    Plus the user gets the thrill of booking directly with the hotels website. Being a Hiltonite myself I particularly enjoy the fun of endless sign-ins because their systems time you out after 2 minutes and a “new” hotel search platform that dead ends you everywhere you turn. That’s a personal issue – but many of the hotel websites I have visited could use an update.

    Finally – content is King and I hope that in the final they bring more hotels online and find a way in their vision to allow for independents to show up. Otherwise this space may not get the traction it needs unless it becomes their discounting tool.

     
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  26. Pete Meyers

    Woah, didn’t realize Hotelicopter was part of the deal, too. Any plans to cover that bit in more detail?

     
    • Kevin May

      Kevin May

      @pete – it’s coming, have an update on a separate post shortly 🙂

       
    • Guillaume

      I was going to say this article doesn’t mention the sale of Adam Healy’s venture Hotelicopter. But now we know someone is working on the case!.

      FYI, Hotelicopter was the pivotal company from VibeAgent. Unfortunately I think the pivot wasn’t such a great success to catch up with the likes of Kayak or TA. I suspect the exit is probably due to shortage of available cash to grow further. The last round of financing was $1.5M in March 2011. And now that Google Hotel Finder has come out, the only option is to partner or sell.

       
      • Kevin May

        Kevin May

        @guillaume – huh?

        what about this bit:

        “Ahead of the launch, RoomKey bought accommodation site Hotelicopter to run the search technology behind the scenes as well as continue to provide its affiliate platform for destination marketing organisations, under a division known as Room Key Solutions.”

        🙂

         
        • Guillaume

          What I meant was an article on its own regarding the sale. What are the reasons for selling, for how much, is the founding team going to be part of RoomKey…

           
          • Kevin May

            Kevin May

            @guillaume – terms of the sale undisclosed. Founding team all joining Room Key (see separate article).

            Reason for the sale, I suspect, is that it’s simply a nice exit for a startup 🙂

             
          • Happy Hotelier

            Or a Crash up?

             
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  28. RobertKCole

    The pace of collaborative hotel brand distribution initiatives appears to be rapidly accelerating.

    The span between version 1.0 and 2.0 was 13 years. It dropped to 10 years between 2.0 & 3.0.

    Welcome to collaborative hotel distribution 3.0 – Metasearch.

    1.0 – 1989 – The Hotel Industry Switch Company (THISCO) formed. Created a Hotel Switch cooperatively founded by Best Western, Choice, Forte, Hilton, Hilton International, HFS, Hyatt, Inter-Continental, Sheraton, La Quinta, Marriott, Promus, Utell & Westin to combat GDS control of hotel distribution.

    2.0 – 2002 – Hotel Distribution System formed. Created hotel booking website (2nd incarnation of Travelweb) cooperatively founded by Hilton, Hyatt, Six Continents, Marriott and Starwood to combat OTA control of hotel distribution.

    3.0 – 2012 – Roomkey.com launched. – Created hotel metasearch site cooperatively funded by Choice, Hilton, Hyatt, InterContinental, Marriott & Wyndham to combat search engine control of hotel distribution.

    The Hotel industry needs to start working now to figure out what it plans to do in 2019 to stay on pace, or if John Davis ever decides to retire…

     
    • Stephen Burke

      Robert, I’m so glad that someone made this comment, or I was going to make it. I’m all for new initiatives, but this may be history repeating itself. Perhaps some folks will make a boatload when this is picked up by a private equity firm in a couple of years?

      p.s. I think there was a worldres in there somewhere, too, in the 1990s. is that v1.5?

       
      • Guilain Denisselle

        Hi Robert and Stephen,
        Are you refering to the launch of Worldres in…1994 (am I becoming too old to remember the exact year?) and to the acquisition of Worldres by Accor/Hilton/Intercontinental in the early 2000s ?
        The world has changed a bit since 1989 and I don’t think the same guys could make it again today in such a changing environment. Competitors are not only OTAs these days. Competitors have never been so strong than today, especially in terms of fresh and available cash ready to be spent: Google, Apple…

         
    • Gautam Lulla

      🙂

      There were others… On the hotel side there was Andbook in Europe somewhere around 2000/2001. Then there was TravelWeb – spin off of Pegasus in 2004 or so.

      On the Airline side, Opodo in Europe comes to mind, pretty much irrelevant now.

      Orbitz might be the only relevant supplier OTA/OTA-ish initiative around.

       
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  30. Room Key launches « Travel Stuff

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  31. Valyn Perini

    My initial response to this site is that it’s a fairly canny response by hotel companies to get in front of (or at least not fall to far behind) Google Hotel Finder.

    Hotelicopter has a mature and tested platform, and the hotel companies involved have years and years of electronic distribution experience.

    My only comment is the UI/UX could be better designed, and this was a problem with the old TravelWeb too; even by standards in 1999, TravelWeb had a terrible UI/UX. The ‘filter by’ graphics are nifty but squashed in the left corner, and the presentation of available hotels is a bit old-fashioned.

    Hotel companies operate hotels, they don’t design web sites, and it shows here. Given some of the innovative UI/UX designs by start-ups like Hipmunk, Room Key had better pay close attention to this.

    @davidwhitley, there are six hotel groups participating but they’ve thrown in all their brands already. Looking for availability in London this coming weekend, I counted 18 brands presented.

     
    • Wouter Blok

      My thoughts exactly on the filters and design capabilities.

      Amsterdam: 5 hotels. In the fierce meta competition they really need to step up if they want to succeed with a selection of only 80.000 hotels of the more than double in a regular meta.

      My first thought was they would create a true bookable experience, but probably the competing brands could not be in 1 and the same ecommerce platform.

       
      • Patrick Mulder

        It’s a step to regain control over their distribution channel. I think a step to watch closely as it can become a challenge for OTA’s and Google itself. It reminds me of another article I read here about increasing commission for the OTA’s when they get more and more control over the market.

         
        • Wouter Blok

          @Patrick sure, I get that. But to regain control over the distribution, you have to make sure that the channel gets traction. That’s a challenge having part of the total available hotel inventory and a meta that has to compete with the likes of Kayak, Hotelscombined and Hotelfinder.

           
  32. Steve Sherlock

    If they allow their hotel loyalty member numbers to be stored and passed through seamlessly in the booking path, then i think that adds value.

    Currently such loyalty members have to go from site to site to compare their loyalty rates, and then book, which is a pain. Only TMC’s offer this but I haven’t seen a B2C platform do it yet.

     
  33. Alex Bainbridge

    Having a viable alternative distribution system certainly will help the hotels when it comes to distribution cost negotiation as no longer will the big hotel distribution systems be able to dictate terms

    So RoomKey doesn’t have to work, it just has to look like it could work 😉

     
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  36. Six Hotel Giants Team Up To Launch Hotel Search Engine Roomkey.com, Buy Hotelicopter | TechCrunch

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  37. Oz Har Adir

    While I don’t see Roomkey goes a very long way commercially, it does signal the direction the industry is going: from meta search to booking on the hotel websites. Same as it does in air.

     
    • Kevin May

      Kevin May

      @oz – yes, something like this probably isn’t about commercials for Room Key itself (it’s meta, after all), but more about trying to control the distribution back to the existing brands.

       
  38. David Whitley

    Why would the average punter use a metasearch site that’s limited to six brands when they could use one that covers most hotels in the destination? Unless they’re sold cheaper on RoomKey – which cannibalises direct bookings and sends people using existing metasearch engines elsewhere.

     
    • Kevin May

      Kevin May

      @david…

      I suspect other brands will be added… Those six founding partners also have a myriad of sub-brands, incl motels, etc.

      The key will be in the marketing, as always.

      The B2B, white label element is also very interesting. Create services for others (such as DMOs, tourism boards, etc) to tap into.

       
      • Oz Har Adir

        Reg. the B2B aspect – existing hotel meta searchers do this quite well, and they are far more comprehensive in both selection of hotels and booking sites and content (language support etc).

        I don’t see how, other than blocking their sites content from other meta-searchers (a two-way sword no hotel will currently use), or dropping existing metas commissions (same) can Roomkey top existing competitors in the B2B niche.

        It can, however, signal the way the industry is/should be heading and trigger more independent hotels to get their booking systems connected to meta search sites.

         
      • Larry Smith

        @Kevin Mays

        Davis says: “Finding the right hotel is complex and, unlike booking a flight or reserving a car, it is a personal decision process – one which no one understands better than hoteliers.”

        While a Hotelier might know, Roomkey does nothing to help assuage the complexity or enhance the uniqueness of a property. It’s just the same old, same old with Roomkey sticking to the generic travel troika interface and user experience: date and place with display by price. Oh, but they do add chain brand name with the words “Official Site” and mix it up a bit.

        Why can’t a site let a customer refine choice in advance? What is so difficult in adding tick boxes with benefits and attributes (pool, business center, in-room kitchen, child care) and having an algorithm sort and list by those criteria rather than price? Over time the metrics will yield knowledge about price sensitivity to benefit combinations.

         
 
 

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