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Data show that meta search sites account for more than 45% of the global tourism industry’s independent traffic, which is higher than the proportion of independent visits by online travel agencies worldwide and in the United States.

　　Most hotel operators are aware of how metasearch ads affect their exposure and trading volume among consumers. If your bid is too low, your listing will not be displayed. If the bid price is too high, the customer's acquisition cost will exceed the standard.

To understand the situation further and explore how hoteliers should compete on metasearch, industry experts analyze the data to see how the giants have made it to the top of the metasearch list. Knowing this information, we can understand how the hotel can maximize its exposure on meta search sites.

Metasearch matures

PACE Dimensions analyzed the data from the market competition analysis tool SimilarWeb. This data covers the top 10,000 travel sites in the world. According to its analysis results, meta search sites account for more than 45% of the global tourism industry’s independent visits, which is higher than the proportion of independent visits by global and US online travel agencies.

The hotel's meta search price comparison site has grown from zero in less than a decade to become an industry with over $6 billion in advertising revenue. When researching the entire digital media and online retailing for tourism and hotel reservations, PACE Dimensions analyzed the top ranked advertisers on each meta search site. The analyzed data included more than 10,000 meta search results. This evaluation was conducted in October 2017 and conducted research on the top five hotels listed on each search on Google, Trivago, TripAdvisor, Kayak, and Skyscanner.

The following is a list of the advertising share of advertisers on major hot meta search platforms.

　　数据来源：PACE Dimensions《美国/欧洲2017年11月至2018年2月元搜索广告研究报告》（点击查看大图）

　　Meta-search dominance brings inspiration to the hotel

Booking.com remains the number one retailer in the meta search community: Despite reports that the site had reduced its digital advertising spending at the end of last year, it’s still in the average advertising volume of all top five hotels in all metasearch sites. Accounted for 20% of the share. This site has the largest volume of business on Google, accounting for 25% of the top five hotels.

The advertising expenditure of the first two advertisers exceeds the sum of all the hotel's official website: Booking.com and Expedia's advertising expenditure exceeds the sum of all the hotel's official website. The official website of the hotel's advertising expenditures accounted for only 8% of the total, while Expedia and Priceline's advertisers accounted for a total of 52%.

Despite the endless competition, Booking.com is still one of the largest advertisers on the Trivago website: According to research results, the site’s share of Trivago is 19%, but its total share is lower than the Expedia’s advertising. The total share of merchants (including Hotels.com) is still higher than all other advertisers.

The official website of the hotel has a good performance on TripAdvisor and Google: The hotel's official website has a higher exposure on Google and TripAdvisor, and it is the worst performer on flights and hotel comprehensive meta search sites, accounting for only 7% at Skyscanner. Only 4% is on Kayak.

The power of ownership

The results of the study also highlight the importance of loyalty of advertisers and advertisers owned by major metasearch websites. Both Google and TripAdvisor are independent websites (it is not affiliated with any retailer). Kayak is owned by Booking Holdings, Skyscanner is Ctrip, and Trivago is part of Expedia. The meta-search comparison websites ( TripAdvisor, Google) owned by the media companies brought more direct traffic to the hotel's official website. And those retailer-owned metasearch price comparison websites have almost exclusively redirected their metasearch traffic to retailers. In addition, the huge market power of Expedia and Booking Holdings has become a huge obstacle to the vertical integration between Google and TripAdvisor. TripAdvisor's attempts to launch instant bookings incurred a lot of resistance and eventually had to be downsized. This shows that the competitive environment is extremely cruel. So, what kind of pattern will there be in the next step?

The industry structure will still be created by the hands of giants: Metasearch is becoming more and more mature, there is continuous integration, the arena is getting smaller and smaller. Several heavyweight companies have most of the power, so new small sites are extremely difficult to succeed. Consumers tend to only look for "one" when searching and planning their trips, meaning that hotel companies must appear on all major price comparison websites. However, as we have seen, the advertising expenditure of large retailers is always higher than the advertising expenditure of the hotel itself. This makes it harder for the hotel official website to have a higher exposure rate, and it is difficult to reach a direct booking transaction because it allocates advertising expenditures in multiple channels. And transparency is still a big problem.

Although the hotel meta search site helps consumers compare a large number of suppliers. However, these websites do not indicate to consumers that the top ranking of listings depends on advertising. The meta-search website gives the impression that it can respond to the needs of customers, but it is not so frank for the factors that affect hotel exposure. These factors include retail practices such as price structure. When price structure is adopted, the price difference between the highest price and the lowest price in the market is misleadingly displayed as a discount.

Emerging technologies will accelerate the emergence of important competitors as leaders: Artificial intelligence in emerging technologies will have the greatest impact on the market. It will benefit larger market leaders. These sites have a huge amount of money to invest and they also have a lot of customer data. Artificial intelligence will enable leaders to more accurately predict consumer behavior and bring them a more personalized approach to consumer search and booking.

Subversion: Airbnb and other homestay providers will increasingly compete with hotels through meta search channels and on-line travel agencies that display hotels and homestays on their pages. Airbnb has begun to sell independent hotel rooms through its own platform. Therefore, the competition between retailers will also increase, which may force the commission to decline.

Given the maturity of metasearch, newcomers are more likely to come from other established media companies or cross-industry retail companies. This may include Facebook or Amazon, because these companies have a stable consumer base, have access to large amounts of consumer data, and have strong spending power.

(Source: tnooz)