Amazon getting into travel business

Discussion in 'General Discussion | Travel' started by Switch2, Dec 12, 2014.  |  Print Topic

  1. Switch2

    Switch2 Silver Member

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    http://skift.com/2014/11/20/exclusive-amazon-to-get-into-hotel-booking-with-launch-of-travel-site/
    "The initial rollout of Amazon Travel would feature a curated selection of hotels within a few hours’ drive from New York, Los Angeles, and Seattle. The service will likely go live around January 1."

    "According to one of the hoteliers Skift spoke with, Amazon intends to use the merchant model that Expedia and Hotels.com used as a foundation for growth, but Amazon would entice hotels to sign up by taking a considerably lower margin, around 15%. Expedia’s usual is 25%."
     
  2. daninstl

    daninstl Gold Member

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    Looks interesting but seems like a crowded arena.
     
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  3. iolaire
    Original Member

    iolaire Gold Member

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    I'm always amazed at those margins for a web based booking systems. I find it hard to believe that a booking.com type solution would require even 15% commission to be a viable business. I could see something like Expedia that has points programs and random discounts that they need to fund and the like costing more, but a pure booking and review tool seems like the costs could be much lower.
     
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  4. okrogius

    okrogius Silver Member

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    All of those loyalty programs and random discounts are still maybe a percentage or two, this is just lots of profit for historical reasons. Airlines have been able to reduce commissions enough, whereas the hotel space still seems to have them.

    We'll have to see what direction Amazon takes - just another OTA, or something more curated or otherwise interesting/novel.
     
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