Is Expedia Really the Best Deal?

You are looking for a good deal on a hotel in another city and head to the Internet to find it.  Using Expedia, Hotels.com or Hotwire you find what appears to be a great price and book it forthright.  Afterwards, you wonder… “hmmm, did I really get the best deal I could have?”  In search for the answer to this question, I confronted a friend that works at a 4 star hotel downtown Vancouver, Canada.

 As a hotelier, one of the most common questions he gets asked by friends and relatives is simply, “Is Expedia really the best deal?”  The short answer I learned is, No, absolutely not! The long answer is a bit, well, longer.

You see, Expedia, Hotels.com and the hundred other online booking engines out there, all enter into complex agreements directly with hotels.  The sites are almost always dynamic meaning that the hotels have the ability to change rates or remove certain days from their availability calendar.  Hotels only upload dates that they need to sell inventory on. 

In exchange for the ability to sell rooms on a given day, hotels agree to provide the online booking engine with a fairly hefty commission.  Expedia for example, often charges hotels up to 25% for everything sold online. If you book a room online for $100 the hotel will end up paying about $25 to Expedia. This leaves the hotel able to pocket only $75 from the sale. Ouch!  Hotels however, agree to this because they have rooms that need to be sold. 

So, how does this apply to the response I got to my question of whether Expedia is the best deal or not?  You see, it works like this.  Hotel’s need to sell the rooms but don’t want to pay commission.  

Are you ready for this?… If you want the best deal, call the hotel directly.

Now, here’s the tip:  If you were to have phoned the hotel directly and said “I found a $100 rate for July 15th on Expedia, can you give me a better deal?”  8 times out of 10, the hotel will say “Absolutely!  How about $90?”  The hotel has just saved itself from paying $25 in commissions to Expedia.  They would have only made $75 from the sale online but by you phoning directly, they were able to make a $90 sale.  Sounds logical right,  So, why only 8 times out of 10?  Why won’t all hotels give a better deal?  There are an number of reasons why, occasionally, when you phone the hotel directly, you won’t get a deal:

-         Poorly trained reservation agents

-         They have a special agreement with Expedia on those dates

-         The reservation agent is a real party pooper

-         The hotel just doesn’t understand that they can make more money by selling direct.

 The tip:  Shop online but call the hotel directly.