Kayak goes direct-connect with Air Canada and debuts split-booking hotel rates

Kayak established a direct-connect booking relationship with Air Canada so Kayak.com customers don’t have to leave the website to book flights with the Canadian airline.

And, among other tweaks to the travel metasearch site, Kayak debuted “split-booking rates” for hotels, added Jetsetter hotel pricing (not flash sales) and editorial, as well as content from Travel + Leisure.

With the Air Canada direct-connect, Kayak tied into the Air Canada API, known as AC2U and developed with Farelogix.

The direct-connect has little to do with search, but alters the booking dynamic so Kayak doesn’t have to send users via deep links to the Air Canada website. Kayak’s flight search is largely handled by Google’s ITA Software, Amadeus and Web-crawling etc.

But with the AC2U connection, Air Canada customers can book flights without leaving Kayak.com (none of Kayak’s international sites have the functionality).

 

When users click “Kayak” for an Air Canada flight, they select their flights, fill in their booking details and complete the booking on Kayak.com.

The new relationship, however, does not turn Kayak into an online travel agency. Air Canada remains the merchant of record and handles customer service.

The book Kayak option for Air Canada, which will be coming to Kayak’s mobile apps in the coming weeks, is in some ways similar to the book Kayak option for hotels, which is handled through Travelocity.

“We’re committed to improving the booking experience for people by providing this choice on the website and on mobile, and we’ll continue to be committed to it,” says Robert Birge, Kayak’s chief marketing officer.

Birge is tight-lipped about plans for future direct-connects with airlines, but one can assume that additional ones are in the works.

It wasn’t immediately clear whether the Kayak Split-Booking rates for hotels is a tiny experiment or is ready for prime time.

In the above example for a weeklong stay in March at the Aria Resort & Casino at CityCenter, Kayak claims there would be a whopping $224 savings when using the Split-Booking option.

To accomplish this type of booking, users would have to open two windows, one for Tripres.com and the other for Kayak (Travelocity), verify availability for the suggested dates, and book the two stays (March 20 to 23 with Tripres at $146 per night with taxes and March 23 to 27 with Kayak at $220 per night).

The new hotel feature is similar to a Hacker Fares, a Kayak offering which enables users to book two one-way fares on different carriers to save money.

 

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Dennis Schaal

About the Writer :: Dennis Schaal

Dennis Schaal was North American editor for Tnooz.

 

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  1. brian crozier

    Kayak has proven to make the airlines money with screen scraping.

     
  2. amancio ra

    Mary, good night, I think this move don’t started in the “innovation” department, it’s started in the CEO office. In the future Google maybe don’t give his QXP to another companies and they need to make new speed connection with de airlines. Amadeus and scraping they are no fast.

    Amancio.

     
  3. Josh Friedman

    I don’t know the legality per se, but there’s no way this is going to stick. It’s an absurd idea and who knows – maybe it designed to create some type of compromise or to push the envelope for some reason. Sorry, I’m not an analyst anymore so I’m not on top of all the details.

    And I’m all over discount pricing if it works for hotels. My business is about ultra luxury travel but value is certainly in the equation.

     
  4. Dennis Schaal

    Dennis Schaal

    Mary: Air Canada handles all the customer service.

     
  5. Roman Peskin

    The ‘split booking’ thingy is quite clever. The only thing I might see as a problem is that the hotel will have 2 separate bookings and this mean two checkins/checkouts formalities, possibly two guest PMS profiles and technically can require you to move rooms.

     
  6. Mary E. Young

    ps looks like this option is not available on http://www.kayak.co.uk, just .com.

     
  7. Mary E. Young

    Congratulations, Kayak and Air Canada for innovating and providing real value for the travel industry.

    A few considerations about the Air Canada direct booking option:
    1) I would imagine the airline will own the customer relationship and data since the booking is essentially happening on Air Canada even if it appears to be on Kayak. Strategically, this is an extremely important value proposition for Kayak and one that gives them a vital leg-up on OTAs. Airlines will be chomping at the bit to implement similar partnerships. The overall dynamic will change now that this is a possibility, and other publishers will follow suit. Of course, Kayak may also implement white labels for OTAs, so this news is a double-edged sword for Online Travel Agents.
    2 ) This will highlight to airlines who are not already prioritizing data-driven partnerships that they need to reevaluate their direct distribution strategy. If you don’t have a API/XML/White Label, make this your number 1 objective for 2012. It won’t just enable Kayak, but other data aggregators and publishers who are using technology to offer increasingly more to the travel industry.
    3) Yes, there may be teething problems – I hope Kayak’s customer service team has extra hands on deck as they roll out these direct booking options because people will inevitably try to contact them about booking changes, despite any messaging saying to contact the airline directly – but the innovation can certainly trump the potential issues as long as everyone is properly prepared to handle them, especially the airline’s customer service team.

    Good luck and looking forward to seeing what else Kayak and other tech-savvy publishers bring to the table in 2012.

     
  8. Dennis Schaal

    Dennis Schaal

    Josh: A lawsuit based on what? What law is being broken? There are two separate and legal hotel bookings? I understand you hate discounting from the hotel standpoint, but where is Kayak doing anything illegal?

    Is it sustainable? That is a legitimate question.

     
  9. Josh Friedman

    Thanks for this morning’s entertainment re hotel split bookings. This is not a sustainable biz model to say the least. Why not just close all ymca’s and hostels n check these bargain hunters into whatever hotel would put up with this absurdity? Marriott and Hilton won’t put up with this so prepare for a law suit. I’d love to see play out at a Four Seasons.

     
    • RobertKCole

      Josh, I’m not sure you have captured the essence of the split bookings.

      There won’t be any lawsuits. One has always been able to split hotel bookings. I have done it myself a half-dozen times over the past five years.

      Four Seasons is an excellent example – check their New York property for a week-long stay. You’ll find that if you arrive early in the week and stay through the weekend, their website probably won’t incorporate the lower weekend rates into the pricing. Depending on your length of stay, you may be able to save 10-20% by trading off the inconvenience of needing to check in a second time.

      The burning question for the loyal luxury hotel guest is this: Which booking method will the brand-loyal customer select?

      a) Not shopping and paying full price by booking the full stay directly with brand.com
      b) Splitting the stay to pay less, but still booking on brand.com
      c) Booking a split-stay through Kayak’s new booking process

      Kayak is simply using a slightly more sophisticated business analysis process to reveal opportunities for guests to save money based on a particular hotel’s pricing strategies. They are also simplifying the traveler’s search and booking process, which is a big convenience benefit.

      Saving people time and money is normally a fairly compelling value proposition.

      For those interested in saving money the lesson is clear – shop around and split stays.

      Additionally, I would suggest that the wide spread promotion of “4-star hotels at 2-star prices” or 50% discounts offered by flash sales has significantly more impact on hotel affordability than split-stays in lowering hotel pricing.

      I think if you look at the recent research, consumers across all economic groups are attempting to not spend more than need. Even for brand-loyal guests are interested in getting the best deal possible.

       
  10. Consultant

    Great to hear about the Air Canada integration, etc.

    On split hotel bookings, I wonder if this is innovation gone too far. Unless Kayak have their own inventory of rooms from hotels or access to systems that give them split availability and prices, there will have to be multiple bookings in order to achieve a split booking. How will this work when the hotel rates require prepayment or when a change is required to a booking or indeed cancellation. Would split bookings have the same cancellation conditions – potentially these could be different.

    Hotel technology has not yet evolved to the point where this type of booking is easily supported and credit to Kayak for trying but it looks like one of those innovations that will be constrained by underlying technology/legacy systems.

    On an “ECO” front, how would a hotel feel about a traveller changing rooms everyday and having fresh laundry each day or will guests be required to move with their laundry? 🙂

     
  11. RobertKCole

    Congratulations to the Kayak team for applying the Hacker Fare process to hotel bookings – this is a legitimate innovation that certainly raises the bar.

    It will be particularly interesting to see customers mixing & matching room categories (for example, a garden view King for 3 nights and a high-floor Double-Double for 3 nights) to capture the lowest rate.

    Operationally, it will be interesting to see how hotels wind up dealing with these bookings – In all likelihood, as two bookings independent are being made, there is not a simple way for Kayak to communicate the linkage, or for the hotel to associate the bookings with a single stay in their property management system.

    Hotel guests may be fine with packing up and heading down to the front desk to change rooms if they capture sufficient savings, or may perhaps choose to plead their case to the hotel and ask to remain in the same room. Hard to say.

    Hotels trying to simplify their distribution strategy by applying run of house pricing might get punished, or may be able to better cope with the split bookings – again, it’s hard to say how popular the practice becomes.

    If customers willing to trade some convenience for material cost savings embrace the concept, OTAs, meta-search players and hoteliers may need to start working on product enhancements. Considering the fragmentation of the hotel industry and the relative inflexibility of PMS, CRS & GDS platforms, this could be a lot more expensive than string & duct-tape patches…

    The main challenge is that hoteliers will now not only need to more carefully manage their room categories and pricing across their various distribution partners, but to also understand how those groups access, price and present their product to the consumer.

    It will also depend on how the hotel Property Management and Central Reservation Systems price inventory in comparison with each other and the distribution partner. If one system provides a single average nightly price across the full length of stay, but another offers discrete pricing for each night of the stay, split stays could be used as a form of arbitrage to capitalize on unintentional gaps between various distribution partners & channels.

    Hotels that have traditionally applied revenue management strategies by aggressively managing pricing by date of arrival and length of stay may have a whole new set of challenges to face.

    I won’t even get into the topic of simplifying the process of searching for the best hotel rates by splitting stays between properties… It does not look like Kayak is taking that step – yet. For now, let’s just agree that the number of combinations that need to be evaluated by hotel competitive business intelligence just increased exponentially.

    Airlines faced a similarly disruptive change over a decade ago when booking platforms started to price itineraries by connecting through spokes when the airline was managing its fares solely based on connecting through hubs.

    Like Room77 – another potentially disruptive innovation – these split bookings undermine a traditional process that is managed by inflexible underlying hotel pricing and inventory platforms. While split booking represents tremendous opportunities for hotels that can efficiently manage the increased complexity, for the others, well, it might just simply scare the hell out of them…

     
  12. Kayak goes direct-connect with Air Canada and debuts split-booking hotel rates

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