Search, OTAs, and Online Booking: An Expanded Analysis of the Billboard Effect

Anderson, Chris

Search, OTAs, and Online Booking: An Expanded Analysis of the Billboard Effect

Abstract

Replicating and expanding an earlier study, this report confirms and quantifies the so-called billboard effect that occurs when online travel agents (OTAs) include a particular hotel in their listings. An earlier study, based on four JHM-owned hotels, found that a hotel’s listing on Expedia increased total reservation volume by 7.5 to 26 percent depending on the hotel. This number excluded reservations processed through the OTA itself. This larger and more exhaustive study analyzes the billboard effect based on booking behavior related to 1,720 reservations for InterContinental Hotel brands for the months of June, July, and August of three years (2008, 2009, and 2010). The analysis determined that for each reservation an IHG hotel receives at Expedia, the individual brand website receives between three and nine additional reservations. Although these reservations are made through “Brand.com” (the individual brand’s site), they are directly created or influenced by the listing at the online travel agent. The study also gained an indication of the amount of surfing time spent by would-be guests who are investigating and studying potential hotels to book. Some travelers recorded as many as 150 searches, but that was exceptional. The more typical activity was still considerable: the average consumer made twelve visits to an OTA’s website, requested 7.5 pages per visit, and spent almost five minutes on each page.

Date Issued

2011-04-01

Keywords

hotels; online booking; online travel agents (OTAs)

Rights

Required Publisher Statement: © Cornell University. This report may not be reproduced or distributed without the express permission of the publisher

Types

article