The online hotel sector is proving more resilient than traditional channels in volume terms but not prices, acccording to hotels.com.
Nigel Pocklington, managing director of the Expedia-owned accommodation-only website, said volumes continued to be robust but admitted prices were under pressure for major online players.
Speaking at the WTM Vision Conference this week, he said: “It’s a story of high volumes for lower prices.”
The Hotel Price Index, produced by hotels.com at the end of last year, showed global hotel prices were 12% down. “There is some fairly aggressive price cutting,” added Pocklington.
He maintained there continued to be a shift to booking on the web, with the online sector proving more resilient during the economic downturn.
He added: “From an industry point of view, people will continue to shop around but the shift to online is continuing. I suspect we will continue to see volume growth in the online sector. It’s been very robust this year in terms of transactions. In the UK market our transaction growth was higher than other markets.”
In the last 18 months hotels.com’s hotel portfoliio has increased from 80,000 to 100,000 properties.
The picture painted by hotels.com contrasted sharply with the traditional high-street. The Co-operative Travel managing director Mike Greenacre said late bookings had yet to take off, and gave a bleaker outlook for this summer than just two months ago. “We remain concerned about the lates market. There are no real shoots of change in place,” he said.
Meanwhile, the cruise industry has benefited this year from having more early bookings in place before the recession hit and has mopped up demand which could not be met by operators following capacity cuts, said Carnival UK chief commercial officer Peter Shanks.
“We had a healthy chunk of business for 2009 by October 2008. As traditional operators have reduced capacity we are benefiting from that in the lates market; Ocean Village is doing very well this year because more people are going on cruises for the first time,” he said.
Eurostar sales and marketing director Emma Harris said the train operator had suffered from the downturn in the business travel market, although leisure volumes were “slightly up”. “The outbound UK market is holding its own but [total] volumes-wise it’s flat,” she added.
* Greenacre ‘concerned’ about lates market (Travel Weekly, June 4, 2009)