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Behind the Scenes at Booking.com

Posted on 06 August 2013

Booking.com, the biggest booking site on the web

Booking.com, the biggest booking site on the web

By Mary Alice Kellogg

Are we deluged with television ads for hotel booking sites? We are. Are we confused as to which give the best prices and customer service? It goes without saying. Can we trust the hotel reviews on the sites? Caveat emptor, say savvy travelers.

Recently this reporter was given unlimited access to the world’s largest hotel booking site, the one until this year nobody in the U.S. had heard of.  Which seems odd, since Booking.com books 1 million guests a day worldwide, with a total of 3 billion bookings in 2012 (up from 1 billion in 2010).

Founded in Amsterdam in 1996, Booking has 102 offices worldwide, with customer service by e-mail and phone in 41 languages 365/24/7, offering 317K+ lodgings in hotels (chain and independent), B&Bs, apartments, hostels and villas – 25 categories in all — in 183 countries. Even igloos … in season. Oh: it also won the JDPowers best travel site in America award last year. So why don’t you know about it?

You’re starting to. In February 2013 Booking decided to advertise in the U.S., which happens to be its largest global market, with a series of whimsical television spots. “For years we’ve been the elephant behind the tree, a global success story but with little brand recognition in the states,”  says Booking’s CEO Darren Huston, who came aboard 21 months ago after executive stints with Starbucks and Microsoft, “If you’re not on TV in the U.S. it’s not real.”

It took some gentle convincing and hard demographic evidence for Huston and Marketing Officer Paul Hennessy – both Americans – to counter a cornerstone of  Dutch corporate culture: don’t toot your own horn and let the results do the talking. This low-key approach made Booking a global leader, but also created confusion in the U.S. because, well, Booking wasn’t on TV. Even though the U.S. is Booking’s largest market, it had no media presence, no brand awareness. “I had never heard of Booking.com when I was asked to be CEO,” says Huston, “I said it can’t be that big.”

It was. And is.

While U.S. awareness is beginning to change, what hasn’t been changed are the elements that made Booking the world’s largest site in the first place. Part of the Dutch corporate culture includes keeping everything internal with no outsourcing and letting the product speak for itself. Inside the company’s headquarters, two state-of-the-art contemporary buildings on one of Amsterdam’s most picturesque and upscale canals, employees from more than 100 countries work in sleek, light-filled offices – all with postcard views of the city. Energy and enterprise are palpable, much like stepping off the plane in Hong Kong and being plugged into the electric grid.

Booking.com's Amsterdam headquarters

Booking.com’s Amsterdam headquarters

Particularly so in the Customer Service offices. To stroll through the main call center in Amsterdam them is to hear 22 languages being spoken at once, a present-day Tower of Babel as reps pace with headsets on conversing with and solving problems of customers at the end of the line. And, as this reporter heard firsthand, there are no corporate scripts. Each customer service rep is empowered to make far-reaching decisions, from contacting an individual hotel’s management directly to switching a client’s hotel – including paying for the taxi to get to that new hotel.

There is no outsourcing of call centers; the only time you’ll get someone in Bangalore is if you are from India and call Booking to solve a problem in your own language. Every Booking call bank worldwide is in-house, with employees fluent in 41 written languages (on the website) and 22 by phone. In all, the company employs 3000 native language speakers worldwide. This is key as said employees are well-versed in their country’s customs, and the ins/outs of getting things done (Americans want problems solved yesterday, Japanese clients like to spend five minutes or so of establishing contact before getting to the problem at hand, etc.). On an average week Customer Service fields 2.4 million calls, 94% of them reservation-related. The result is a 90.2% customer satisfaction rate, something that caught J.D. Power’s attention last year.

Screenshot_2013-04-15-08-12-59

A potentially thorny issue for all hotel booking sites is the price quote. Booking is alone among sites in the U.S. to include all taxes/extras in its quote. Only a few countries – Holland, Germany, Australia – have laws requiring internet sites to include all fees, much like airline sites. The rest of the world doesn’t, hence the disparity in pricing. A recent New York Times piece about booking sites had Booking coming in highest for a particular hotel … but also mentioned that on arrival there was a whopping 36Euro surcharge per night, which hadn’t been in the price quote on the site the reporter booked. Booking CEO Huston is in the vanguard of wanting all extras to be included on sites globally so the consumer playing field is leveled.

Having 130,000 new properties added to its reservation base every year only adds to the challenges of another key consumer hotel website issue: customer reviews and client trust. How do we know that rave review wasn’t written by the hotel’s PR rep, the B&B’s journalism student nephew? Conversely, were those negative comments possibly written by a competitor? Such questions have hounded booking sites since their inception, as any tech-savvy consumer knows that comment factories can be bought in bulk for pennies. Booking tackles this problem by insisting that someone can only do a review if they have actually booked with the company and stayed at the hotel. More than 100,000 reviews are submitted globally every day, and Booking’s special Fraud Team verifies every one. All reviews are posted – good and bad – and none are older than 14 months. Past reviews, 21 million in all, are archived. The average hotel has around 65 posted reviews, all fresh, all user-driven.

CEO Darren Huston says his goal is “To paint the world blue,” the company’s signature color. Ironically, Booking.com already has. By doing things its own way, thank you very much.

Visit Booking.com

 

 

mak    Mary Alice Kellogg, a New York-based writer and editor, is a recipient of the Lowell Thomas Travel Journalism Award for Consumer Reporting. A contributor to many national publications, including Travel + Leisure, Conde Nast Traveler, Bon Appetit and GQ, she has reported from 120 countries and five of the seven seas to date… and counting.Visit MaryAlicekellogg.com

 

24 Responses to “Behind the Scenes at Booking.com”

  1. Simona says:

    I’d suggest you include a current screenshot of the website and brand you’re writing about. The company’s logo was changed a year ago ;)

  2. Tom says:

    Behind this fairytale view of booking.com, it would have been good to mention the darker side.
    Like when Booking is presenting the results of a search sorted, by default, by “Recommended”. You would suppose that Booking recommend hotels because it is a nice deal. This is actually “recommended” for Booking.com’s profit, not for the guest’s best interest. In the extranet, hotels can “override commission for a higher ranking”
    & “If you adjust your commission rate, you’ll be able to see how it affects your ranking” (copy of the exact texts).

    Like when Booking says “No booking fees”. This is not true, there is a booking fee, it is paid by the hotel which therefore added this to its costs and… its prices (+15 to +30%!).

    Like when Booking says “Best price guaranteed”. This is not always true. Better check direct to the hotel. Remember to tell them you prefer a sea view room: the hotel will prefers to keep to direct customers.

    Like when Booking.com reserves the right to use the name and reputation of a hotel (hum!) “partner” to place an advert at the top of a Google search on that name while at the same time requiring hotels not to do the same with booking.com’s name. Is that a real partnership ?

    Like when Booking do not allow hotels to send email marketing messages to guests they brought and stops sending guests email to the hotel so that only them can spray guests with several weekly emails.

    Booking is a fabulous website but always check directly with the hotel and prefer booking directly when possible. This is more ethical.

    • Vlad says:

      Sort hotels by price – lowest first :)

    • Julia says:

      I run an small hotel (which works with booking.com), and think that what you say is not completely accurate:
      I do not think it would be correct to use the email address that we receive from booking.com for marketing purposes. The guest did not agree to that, the guest agreed to give the address to hotel for reservation issues. If the guest at arrival at my hotel decides to provide his/her email address and I advise we may use it for marketing purposes, that would be correct.
      Imagine you buy an app in apple’s app store and apple would provide your email address to the app and they would use it for marketing purposes. You wouldn’t like that either.

      On the other hand, I must say that we do not treat booking.com guests any different than we treat our direct bookers. If they ask for a lake view(no sea view here) same price and same opportunity to get it as a special request. I heard somo hotels have better rooms for booking.com guests because of the reviews. That is not fair either, in my opinion.

      Nobody forced me to be on booking. I chose to be there so I do not complain about the commission. If I do not like it, I can stop working with them. I think that it is not nice to complain (as some colleagues do) that they hate to pay the commission but they love to receive all the guest that they did not get before. Since I am in booking.com as a partner, I must also say, that direct bookers have also increased.

    • Rab says:

      Oh, yeah People!

      Book directly through the hotels and You’ll pay the same or bigger money, but You’ll get bad room as You won’t write the review on booking.com and nobody cares about You.

      Book directly and have no customer care, that will help You if something go bad with Your trip. Booking customer care will help You if the hotel is overbooked, You get lost in the town and so on.

    • Filou says:

      It seems you never study tourism… speaking about commissions…

      And the commission is not the only criteria to rank hotels. otherwise you won’t see in some destinations, apartments above luxury retreats.

      They found a way to be profitable & customer driven, i guess it’s a matter of genius & not narrow minds like you…

  3. Alexandra says:

    I’m sure their Canadian CEO will be THRILLED to have been labelled an American!

  4. John Michel says:

    Hey Tom,

    I guess you forgot that Booking.com is a company and that, as such, it has to make profit.

    What did you think ? That Booking.com did not want to make money out of it ? Hotel always complaints but the thing is that Booking.com make them viewed in the all world and in one place, Booking.com.

  5. Tracy Tang says:

    Keep in mind that hotels pay Booking.com at least 15%, normally 20% commission for every room sold, so contact the hotel directly to have better price.

    The “best price guarantee” is only guarantee over online price, there’s always better offline price :)

    • Iym says:

      Use the hotels comparison website then. But be careful with front end rates, if you found it cheaper, that might be because its excluded tax and service charge.

  6. Tom says:

    Thanks to all your answers… I’ll try to answer all.

    To Vlad: I may sort by price, but it remains that using “Recommended” is misleading (see below).

    To Julia: I agree with your point regarding emailing for marketting purpose. As property owner, I used to receive, on the details of Booking’s reservations, the email address of the guest. It allowed me to send immediately a warm welcome email with detailed directions and some advices. Guests were appreciative. By not sending us anymore this email, they make it more difficult to do our job nicely, and this, just to keep as much as possible the “property” of the guest. Their profit first, the interest of their guests second.
    When a hotel pays a 15 to 30% commission to a third party, the hotel will necessarily have less flexibility when dealing with these guests. While many will not create a difference, some are trying to give more advantages to those booking direct as this is a way to keep some control of their own business. What value/goodwill is left to a hotel if most guests belong to Booking as is more and more the case in small hotels in Europe, if all clients can disappear upon a third party’s decision ? We do treat guests the same when they arrive here, but our price/conditions are different so as to entice guests to book direct. Our website shows all our availability while many dates are not made available on Booking. In case of cancellation, we are more flexible with direct bookers.
    While we are happy to be on Booking, we do not agree with their many tactics often over the limits of what is acceptable in the real world. You may be free to go away from them, but many are not anymore. Fair competition is also in the long term interest of consumers.

    To Rab: I did not mean it is always better to book directly, but it is always better to check and compare both. Prices on Booking are decided by the hotel. Some still think it is better to give a competitive advantage Booking. Not sure this is wise on the long term.

    To Filou: I never studied tourism. But I have learned a bit overtime. Can you be more specific speaking about commissions ?
    There are 7 criterias affecting the rankings (Constant Availability, Conversion, Cancellations, Correct Payment, Commission, Competitive Rates, Content). All of them are essential to Booking’s business model & profits. None of them is based on the score of the review for that hotel. Why? No effect on the bottom line?
    Make no mistakes, I appreciate Booking. It is a very efficient company/website/customer service. They are well above their competitors and it is such a service for customers.
    It would be genius without such predatory tactics. You may be brighter than average but we welcome guests and discuss with them and they are all surprised when they discover how they are manipulated by the Internet.
    Thank you for the “narrow mind”. Very elegant!

    To John Michel: They need to make a profit, but they also need to respect to those who create them, be they hotels of guests.

    To Tracy Tang: It is not always better offline.

    To all travellers: when a commission is paid to a middlemen, it becomes part of the expenditures of the hotel. When calculating its prices, the hotel will include all of its expenditures in the room prices that he send to his website and to Booking. Who is going to pay the prices ? In the end, the visitors pay the commission: the hotel still need to keep making a profit so as to maintain and improve his hotel.

    To be more specific, if you book a hotel for 200$ for 3 nights. The commission is at least 90$, more likely 150$ in larger cities. Would you, as consumer, be ready to pay this extra amount in exchange of the service Booking is providing ? Of course you would not…
    But you do!
    Should this “extra” go all in the pockets of Booking’s shareholders or should it go also in the hotel you will be staying so that they can give you an improved service?

    So, Booking is fabulous, but do look at both sides of the story.

    One last shot.
    Mary Alice Kellogg writes “CEO Darren Huston says his goal is “To paint the world blue,” the company’s signature color”.
    On French TV, a few days ago, journalist ask Darren Huston “Do you want to take control of all this business?” Answer: “Oh, absolutely not”.

  7. Jimmy Jam says:

    Tom, could you give an example of a competitor of Booking.com that ticks all of the boxes you’ve stated as being a negative on Booking.com?

    I’ve booked through several hotel sites and the sheer service I’ve received as a customer with Booking.com has vastly exceeded anything I’ve received from other sites (or any company).

    There are also plenty of hotels available so it cannot be a bad thing to be a partner of them either, otherwise they would not work with them.

    • Tom says:

      Not sure there is a competitor that tick all the same boxes. What is your point ?

      I agree that Booking provides a great service to their visitors. It does not make their behavior in the points I mentioned more acceptable.

      We are also happy to be a partner of Booking. That does not mean we cannot criticize some of their behaviors. I have learned a lot and try to use their marketing power with measure to protect my business. Many of their visitors and hotels partners just drink it all without understanding the situation.

      I am not here to say Booking is bad. I am here to say there is also another side and showing only the bright side is misleading.

      Note that the situation in Europe might be quite different as Booking is just starting to put their mark on your market.

  8. Jimmy Jam says:

    Hi Tom, my point is that its easy to make such points (unsubstantiated or not) but unless there are alternatives / options that do offer these points, there is no real cause to state them.

    In this case, no other option exists that does provide the points you mention. While I agree at offering a fully rounded and objective piece (as you state being your goal) you are also not offering the full picture – by only pointing out certain negative aspects (some of which are incorrect) and not mentioning that no other online hotel supplier caters these aspects either.

    • Tom says:

      Just because major operators in a market act in ways that I criticize does not mean that I should just accept the problems and not talk about them.
      I am not writing an article about Booking.com, I am commenting on one that seems to paint it all blue like a fairytale, stating that it is not all blue and giving examples.
      I did not only point some negative points. I repeatedly said that it is a fabulous website and that I am happy to be their partner.
      If I am wrong in some points, can you mention which and elaborate ?

  9. Peter says:

    Very interesting article – well written and structerd – fascinating place. Would love to read more by this author.

  10. Linda K says:

    Reviews along with price (quality/price ratio) are the most important factors for everyone. In socialist Europe, customers dont get either because unions and goverments guarantee hotel owners a monopoly. They bitch a little and they get everything they want. ( not only hotels btw).

    Since there is not free competition. Hotels historically have had the freedom to offer the worst possible service for the highest possible price. Since they are a little proctected community, there is absolutely nothing the customer can do – reason why customer service in most european countries are a concept that does not exist, in the remaining it barely does.

    Hotels in Europe are not good at all. I have not tested hotels in the US. in Europe, they all lie about location, fees, something in the spa area is always broken, etc. So, there is no reason to book a hotel directly since you need the possibility to cancel and/or complain to someone that will care.

    Hotels have always been overpriced because hotel owners dont give a shit about customers. They dont have to. So that story “we end up paying for the commission” might be true, but we got lower prices thanks to booking.com because booking.com forces them to have lower prices in the first place.

    Hotel owners before booking and even today overprice as much as they can. Since these socialist countries, they are protected by unions and governments, so they have protection against competition. So they can do whatever they want, and they do. That’s why it is expensive and crappy.

    So, booking.com has been good for customers. To be honest, I love to hear some hotels are not happy with it. Welcome to a world where free competition exists and you lost your right to rip off everyone freely.

    I mainly book 5 star hotels, sometimes a 4 star hotel if it has excellent reviews. Not because I am rich, but because otherwise I ll be in smth dirty, horribly located, and paying lots of money for it, and be completed ignored if I ask why the sauna is broken or the pool closed or why I didnt get the room with the view i had booked.

    Again, in the US there is free competition. Markets are not protected, so anyone can have a hotel. Prices, quality, and customer service are essential to stay in business. Since you have tripadvisor for reviews, I am not sure booking.com offers anything useful.

    Ps. I am European,but I have a very multicultural family, so I got to see the world from an insider’s point of view. I’ve worked 30 years in the hotel/tourism industry in Europe in finance and auditing. You ll never hear an European complain about this because they dont see how socialist rules and practices ruins everything for them. Of course, those on the other end wont say anything either. It s the dream of every business to eliminate all competition.

    • Marc says:

      Honestly, are you on drugs?

      The market is protected? There is no competition?

      Anyone can have a hotel in EU, it is a free market, there is loads of competition and success definitely depends on pricing, quality and customer service.

      The issues you are referring to, are only with the larger hotel chains, and those specific issues, are world-wide.

      You did not get lower prices because of booking.com, all hotels just added the commission on top of their old prices, meaning you actually end up paying more, hit up a hotel directly and you can get the same room for about 10-20% less because they don’t have to pay commission. Hotels aren’t allowed to have this information online, due to booking.com’s terms, which go as far as needing to have the same price on booking.com (including commission) as on their own website.

      Your problem isn’t socialism (which honestly, we don’t have in EU), your problem is capitalism, which is world-wide.

  11. Tera Allton says:

    Great information for people planning travel and great for their budget!

  12. ervin says:

    IMHO booking.com does a great job for both the industry and ist customers.

    My big grief with them is they will not publish a negative review
    – – tried two times in as many years.

    And, before you ask, I mostly give positive reviews.

    That is a dishonest practice everybody should be aware of.

  13. Tingo says:

    Let me join the discussion. I am a traveller heavily using booking.com. What I do not like about booking.com is its world monopoly and dominance in hotel booking business. I would prefer to have more options to select from more booking sites.
    I also understand property owners. Many of them are strongly dependant on booking.com guests and it is not a good feeling if you realize your business will end after booking.com cancels contract with you.

  14. Tom says:

    Manolis, thank you for commenting openly here.
    I agree with most of your points. Fabulous website both Internet & Extranet. Much better than your major competitors. We can really feel that you pay a lot of attention in it, always modifying, testing new features and improving. Customer service is also fast, efficient & respectful. Partners relation is also very polished. I am afraid your competitors will suffer…
    There was a great need for such a website, both on the visitor & owner’s side.
    Well done ! I am part of it and (mostly) happy, many bookings. I profit from it.
    I closed my contract with Expedia a few month ago as I was not satisfied. I do not intend to close mine with Booking.

    This does not mean that I must feel all is perfect.

    From a guest side, you deserve the truth. While the front page of Booking.com states “No booking fee”, inner pages mentions “For each reservation … the Accommodation shall pay Booking.com a commission” (Terms & conditions for hotel registration – 2.1.1). May be I am wrong as I am not a native English speaker, but is a commission not a fee ?

    “Where exactly is the booking fee?” Hum, Hum…

    Regarding the commission, Booking fully deserves to get paid for their fabulous service. Had hotels started their own similar service, they would also have incurred important costs.

    I did not say that Booking should show their negative sides (unless the writer of this article is from Booking.com!). But, its marketing, while often just within what is permitted, sometimes profits too much from the innocence & ignorance of visitors and owners. It is open for debate, but this is what I feel.

    A great way to show more respect to hotel partners would be to accept to stop using a hotel name in adwords when the hotel ask, even after the contract have been signed. I am lucky to have been aware of this point before signing, but several colleagues have seen a refusal on this point.

    On the back of this discussion lies bigger questions of free market, globalization, capitalism, monopolies, weak world governance, … and I am not sure to be on the same wave length as some of you ;-).

  15. As a hotel owner,

    I agree 100% to what Tom is saying.

    Tom: very nice of you trying to explain things to people, I really appreciate how some people can see the bigger picture.


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