The End of the Hotel Metasearch Model as We Know It


Price comparison engines, better known as metasearch engines or
simply metasearch, have been around since 1995. Remember websites
like BargainFinder, NetBot and Nextag? In travel, price comparison
sites have been in existence since the early 2000s. Early flight
metasearch entrants were SkyScanner and Kayak, followed by Momondo
and Google Flights. Hotel metasearch was also introduced in the
early 2000s with early entrants such as,
(acquired by, and over the past 13 years Trivago,
Momondo, and TripAdvisor.

Price shopping, including flight and hotel metasearch, is needed
by consumers when there are hundreds of price choices but becomes
completely irrelevant when there are only a handful of choices

Flight Metasearch vs. Hotel Metasearch

There is a monumental difference between the business model of
flight metasearch and hotel metasearch:

  • Flight Metasearch (Kayak, SkyScanner, Google
    Flights): These sites compare airfares between Point A and Point B.
    Example: NYC – LAX with 10+ airlines operating this route and
    offering hundreds of price and service options: nonstop, one stop
    or multiple stops; different departure times; different classes of
    service and seats; various routes and flight durations; and more.
    The hundreds of airfare and service variations are the reason why
    air travelers need price comparison sites (flight metasearch) to
    sort out all of their options and make an informed decision.
    Ultimately, this need is what determines the future and longevity
    of flight metasearch.
  • Hotel Metasearch (TripAdvisor, Trivago, Google
    Hotel Ads): These sites promise to compare rates on hundreds of
    sites for the same hotel. Travelers are promised to find the best
    price for the property they have chosen, not the best hotel in the
    destination they are traveling to. All of the TV and digital
    advertising campaigns by TripAdvisor, Trivago, and more communicate
    the same message – “We search over 200 booking sites to find
    the best price for the hotel you want”.

This leads us to ask the following question: what exactly are
the hundreds of websites where hotel metasearch get their rates to
compare? Expedia,, Orbitz and Travelocity offer the same
user interface and rates and have no differentiating value
proposition. It is clear that these sites are all part of the same

Why Hotel Metasearch is Inherently Flawed?

The very promise to compare rates on hundreds of sites for the
same hotel is what makes hotel metasearch inherently flawed. Back
in 2003-2005, there were dozens of OTAs and hundreds of affiliate
sites giving hotel metasearch relevance. The issue today is that
many of those OTAs and affiliate sites are non-existent after many
went out of business or were acquired by bigger OTAs. On top of
that, hoteliers became more savvy revenue and channel managers and
began to enforce rate parity across the board.

As a result, today there are only three websites worth travel
shoppers’ time when researching the best price for the hotel they
have chosen: two OTA sites ( and Expedia) and the
hotel’s own website. What is there left to compare with only two
OTAs left in much of the world?

A choice of three options does not warrant a price shopping
service such as hotel metasearch. Hotel shoppers are very savvy at
this point and see clearly through the fake choices offered by the
hotel metasearch players. This is why Trivago and TripAdvisor are
showing a decline in business and financial performance in recent

Can Meta-On-Meta Save Hotel Metasearch?

Recently, some of the hotel metasearch players like TripAdvisor
are buying traffic by bidding on Google Hotel Ads. At an estimated
6x ROI from Google Hotel Ad (GHA) campaigns, there is no way the
economics of meta-on-meta can work. In other words, TripAdvisor is
losing money from every click and booking they generate from GHA.
This is definitely an unsustainable way to buy traffic and position
TripAdvisor as a booking channel, something TripAdvisor not been
able to convince the traveling public of after spending millions in
advertising for the past 5 years. Travelers have already made up
their mind about what the hotel booking channels are: the hotel
website and the mega OTAs, and Expedia.

At HEBS Digital, we have been running GHA campaigns since 2010
for thousands of our hotel clients, seeing ROIs of 6x – 12x. ROIs
vary based on how appealing the rate is, the hotel location, and
how well known the brand is. However, these ROIs are aided by the
fact that travel consumers perceive direct hotel campaigns as the
“official” presence of the owner of the inventory, in this case
the hotel. TripAdvisor is perceived as an intermediary therefore
their ROI is inevitably lower. Even if TripAdvisor’s ROI from GHA
is 8x, they are losing money from every GHA click. At an effective
commission rate of 12% they make from an Instant Booking, they
would still be losing approximately $4 -$5 per booking. They need
to be reaching ROIs of 10x and above to break even, but it is
unlikely their ROIs even come close to what we are seeing from the
hotels’ official GHA campaigns.

What is the Future of Hotel Metasearch?

I believe at this point it is too late for hotel metasearch
players like Trivago and TripAdvisor to:

  1. Change their business model from promising hotel shoppers the
    best price for the property they have chosen to promising them that
    they will find the best hotel in the destination they are traveling
    to. Travelers have long chosen and Expedia as their
    favorite research tools for finding the best hotel in the
    destination they are traveling to, and both OTAs offer a wealth of
    research tools to facilitate this: maps, descriptions, rich media
    and customer reviews. For example, both Expedia and
    offer over 700 hotel choices in New York City, far more than any
    metasearch player.
  2. Position themselves as “booking sites” in the collective
    mind of the traveling public. As witnessed by the attempt by
    TripAdvisor called Instant Booking, and Trivago’s Express Booking
    initiative, this is not an easy task.

So, what is the future of hotel metasearch players? The answer
can be found without looking far. Take online retail as an example.
Has anyone ever heard of the top online retail price
comparison/metasearch engines out there? The price comparison
leaders in retail include Nextag and PriceGrabber, as well as
Shopzilla,, and Pronto. Hardly well known, yet these
are the top online retail metasearch engines, which are confined to
a very niche status by and the extraordinary
consolidation in the online retail space.

Due to the OTA consolidation in travel, the same is already
happening in hospitality. Hotel shoppers looking to find the best
price for the property they have chosen go to the hotel website, or Expedia. Hotel shoppers looking to find the best
hotel in the destination they are going to go to and

As a single-category-focused hotel metasearch player, Trivago
will be confined to the status of a niche player at best. As for
TripAdvisor, which is the largest travel website on the planet and
has a much broader business model and a multitude of product lines,
the site needs to refocus on monetization of its large amount of
website traffic by revamping its media product while scaling its
restaurant and experiences product lines.

What Should Hoteliers Do in Hotel


TripAdvisor hurt metasearch advertising on its own website when
it introduced Instant Booking a few years ago, a commission-based
CPA (Cost-Per-Acquisition) model.

The much-promoted Instant Booking has been struggling ever
since, mainly because travel consumers do not perceive TripAdvisor
as a booking channel. A negative effect from Instant Booking came
as most hotel advertisers abandoned metasearch advertising
(Cost-Per-Click) and switched to the Instant Booking
(Cost-Per-Acquisition) model.

Recommendations for hoteliers:

  • Treat TripAdvisor as a soft-OTA distribution channel. If you
    have occupancy needs and you haven’t already done so, ask your
    CRS provider to sign-you up with Instant Booking at the best
    possible terms. Ask your revenue management team to monitor closely
    and report on the contribution of this channel separately from the
    other OTAs. Evaluate participation every 3 months.
  • If you haven’t done so, test banner advertising on
    TripAdvisor. At HEBS Digital, we are seeing consistently good
    results for our clients with ROIs of 8x – 12x.


Trivago is strong in Europe. If this is an important feeder
market for your hotel, it is worth considering this metasearch site
and its Express Booking CPA program.

Recommendations for hoteliers:

  • Treat trivago as a soft-OTA distribution channel. Ask your CRS
    provider to sign-you up with Trivago’s Express Booking at the
    best possible terms. Ask your revenue management team to monitor
    closely and report on the contribution of this channel separately
    from the other OTAs. Evaluate participation every 3 months.

Google Hotel Ads:

Over the years, Google has become the most important direct
booking channel in hospitality. Over 50% of hotel website bookings
are direct referrals from Google: 30% from organic and 20% from
paid initiatives.

Over the past several years, hotel advertising on Google has
become increasingly complex, due to changes instituted by Google
itself, changes in travel consumer planning behavior, and
advancements in technology.

Based on all of these developments, hotel marketers must plan
accordingly and understand that the Google Ecosystem has become
a fully-integrated advertising platform where all advertising
formats are intertwined and work together: Google Ads (formerly
AdWords), Google Display Network (GDN), Google Hotel Ads (GHA),
Google Admail, YouTube. User engagement in the upper funnel
influences conversions in the lower funnel, and a campaign in one
advertising format influences the results from all other

Treating Google as a fully-integrated advertising platform
requires hoteliers to utilize all available advertising formats in
the Google Ecosystem in order to reach travel consumers throughout
the travel planning journey.

Recommendations for hoteliers:

Contrary to industry lore, with its GHA program, Google is not
trying to become an OTA. It does not have the OTA CRS technology,
the deep industry distribution and revenue management expertise,
the local sales force and offices needed to signup hotel supply,
customer service or support.

Google cares only about providing the most relevant information
to its users. There are four crucial pieces of information needed
by any hotel shopper before making a booking decision: hotel
location, hotel description (ex. a 4-star, 600-room branded hotel
or a small, 5-star boutique hotel), customer reviews about the
property, and price and availability. For many years, Google has
been able to provide answers to the first three questions. Since
the introduction of Google Hotel Ads in 2010, now Google is in a
position to provide answers to the fourth question about price and

This is why hoteliers must participate in GHA to take full
advantage of the Google Ecosystem.

Quite often hotels are asking the question: is GHA a digital
marketing format or is it a distribution channel? The answer is
very simple:

  • If the hotel operates a CPC (Cost-Per-Click) campaign on GHA,
    then this is a pure digital marketing format, and
  • If the hotel uses the CPA (Cost-Per-Acquisition/Agency
    Commission) model, then this is a pure distribution channel.

The situation is similar with a number of other metasearch
players like, TripAdvisor’s Instant Booking,
Trivago’s Express Booking.


In my view, the biggest mistake the hotel metasearch players are
making is their inherently flawed business model that promised
hotel shoppers to find the best price for the property they have
chosen. They did not focus on teaching the traveling public to use
their sites to find the best hotel in the destination they are
traveling to. With only two viable OTA choices left in most of the
world, and Expedia (and Ctrip in China), what is left
to metasearch?

This is the reason for the increasingly lackluster performance
by the major hotel metasearch players and the reason why they will
be confined to the status of niche players at best.

Source: FS – All – Hotels – News
The End of the Hotel Metasearch Model as We Know It