Why Barceló and Pestana are joining Tripadvisor’s new subscription service

Swimming pool view
Swimming pool view. (PublicDomainPictures/Pixabay)

Insight Comment
For the last few years the big hotel chains have talked up the benefits of direct distribution over using the big online travel agencies. It’s always been a trade-off. The likes of Booking.com and Expedia offer massive reach but at the expense of data control and cost. What if there was another way? One intriguing new option is Tripadvisor’s subscription product, called Tripadvisor Plus. It’s at a very early stage, having only just been launched in the United States but has just signed up its first chains. Definitely something to keep an eye on.

Barceló Hotels, Millennium Hotels and Resorts and Pestana Hotel Group have become the first hotel groups to put their accommodation portfolio’s on Tripadvisor’s new subscription offering.

Tripadvisor Plus, which launched in the United States on 16 June, offers special members-only rates and VIP perks to those willing to pay an annual membership fee of $99.
There’s an obvious benefit for frequent travellers who — in non-Covid times — potentially could get a lot out of it, but for the hotel companies involved it also offers an intriguing new distribution offering.

Tripadvisor Plus offers a couple of advantages over the traditional online travel agency model. It doesn’t charge a commission fee per booking. Instead the company makes its money from the consumer via the membership fee. Crucially, members get full access to all of the customer information from each reservation allowing hotels to build relationships with those guests after their stay.

"Our long-standing collaboration with Tripadvisor means that we are always ready to take advantage of all the new distribution opportunities that it offers us, being able to reduce our direct distribution costs and increase the visibility of our direct channels. I believe that Tripadvisor Plus is a product that perfectly complements our strategy and on which we have high expectations," Lluís Massanet, global digital business deputy director, Barceló Hotel Group, said.

At this stage it seems a fairly low-cost, risk free option for hotel companies to explore.

“Hoteliers typically incur significant costs through both online distribution and third party commissions when working with online travel agents (OTA’s). However, by signing up to TripAdvisor Plus, this could help reduce such costs,” Johanna Bonhill-Smith, travel & Tourism Analyst at GlobalData, said when the product was launched back in March.

While the three hotel chains that have signed up so far have a combined total of close to 500 hotels across the world, the absence of one or more of the big hotel chains is a disappointment. Are Marriott, Hilton and Accor now too focused on controlling their own distribution to want to take part?

"Tripadvisor Plus is so attractive not just for the savings it offers savvy travelers, but also for the VIP perks that can help elevate their travel experience. That is exactly what these three partners will deliver, and we're excited about the wide range of accommodations that will be available to our members," said Kanika Soni, chief commercial officer, Tripadvisor. "Our partners clearly see the potential of Tripadvisor Plus to help reduce the burden of high online distribution costs."