Specialist
Former executive at Hotelbeds Group SLU
Agenda
- Hotelbeds – TTV (total transaction value) growth outlook and wholesale share of hotel bookings
- Best available rate penetration and implications for bedbank profit pool
- Competitive dynamics vs Expedia Partner Solutions (NASDAQ: EXPE), Webjet (ASX: WEB)
- Inventory acquisition and sourcing strategies
Questions
1.
You mentioned TTV [total transaction value] being a shade under EUR 6bn pre-pandemic. What’s your outlook for TTV growth? Where do you think we are vs that number? I think FY20 was about 55% below.
2.
How large a component of Hotelbeds’ pre-pandemic business was China?
3.
Was China growing faster as a component than the wider group?
4.
Are there any specific challenges to operating in China as compared to the other markets Hotelbeds is typically based around, so Europe and the US?
5.
Q: How do you think about the market share of bed banks more generally? Is that a growth channel relative to direct and OTAs [online travel agencies]?
6.
You estimate single-digit negative growth for the whole bed bank market. Is that correct?
7.
What portion of the total hotel market do you think the wholesale channel captures? Could it be 10% or 15%?
8.
What’s Hotelbeds’ track record of taking market share in the wholesale channel, organically or inorganically?
9.
Is it uncommon for Hotelbeds to be the exclusive wholesale partner for an agent or hotel?
10.
Are wholesalers integrated to the hotels and agents via APIs [application programming interface], so they can be used within a channel manager PMS [performance management system]? Or do they sit separately?
11.
Is there a layer between the agent and the wholesaler – a Go Global or similar – who aggregates a range of wholesalers and presents those in a single source to a travel agent?
12.
How much of Hotelbeds’ business is conducted direct with the agent vs via a local wholesaler, such as in the Dubai example? The company presumably has a local footprint in key source markets. I assume it wouldn’t rely on third parties in those markets. Is that correct?
13.
Are other wholesalers a relatively small part of the overall Hotelbeds business compared with tour operators and OTAs? Would the company be connecting directly with the OTAs and tour operators without having to go via a third party?
14.
What commission or markup do the different agent categories typically require?
15.
Do the agents take or demand more of the commission from Hotelbeds? Could you see that going to 75%/25%?
16.
Hotelbeds pushes the best available rate all the way through to the end customer, or the OTA or tour operator does that, and then Hotelbeds pays a commission that’s been agreed between those two parties. Is that how it works?
17.
Are the rate differences because hotels don’t have the muscle to push through binding rates? They would presumably set the price if they could.
18.
Is most of the wholesale channel or most of the bookings still FIT [fully independent traveller]?
19.
Do you think the mix will shift back towards FIT as a result of G&D [guarantees and deposits] investment?
20.
Do you generally get a higher margin on FIT as a wholesaler? There’s greater scope to make more margin.
21.
Is G&D investment still a relatively small part of TTV?
22.
How significantly does G&D investment change the overall business and business model? I imagine it changes the working capital a bit. You obviously have to commit cash up front where you didn’t previously. Does that change the business at all?
23.
Is there any flexibility in the guarantees? People might not want to go to a specific hotel any more for whatever reason.
24.
Do you see anybody else doing something similar around G&Ds in the wholesale channel?
25.
Do you view Expedia Partner Solutions as a wholesaler?
26.
Is the Partner Solutions network as big as Hotelbeds’?
27.
Do you think 30%-plus discounts in the G&D channel are sustainable when competing with Expedia Partner Solutions? Have you ever seen an example where a hotel would choose Expedia because it’s offering 25%?
28.
Can Expedia put the wholesale rate into its own D2C channels?
29.
Do you view Agoda launching Beds Network as a negative for Hotelbeds? Could Booking’s more general commitment to the wholesale channel make Hotelbeds an acquisition target?
30.
Is there a vacation rentals angle for bed banks and wholesale? Can Hotelbeds get into that market?
31.
What do you think is Hotelbeds’ M&A focus? Is there consolidation within the wholesale market specifically or are there adjacencies you would expect the company or other wholesalers to consider?
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