Incurring no upfront costs, client hotels would pay 10% commission for reservations made through site

Booking.com, the big online travel agent for hotels, is taking a novel approach to capturing new business from small hotel owners: it is building websites for them at no charge.

The new service, called BookingSuite, will create a new website with no upfront costs. In exchange, the hotel pays a 10% commission to Booking.com for any reservation made through the site.

Booking.com has been testing the service for months and will formally launch it later this week.

The service is aimed at independent and boutique hotels without the deep pockets to build their own online presence. Prior to starting BookingSuite, Booking.com had worked on websites for larger hospitality brands, including Marriott International Inc., which used the company to translate its website into several foreign languages, including Italian, Arabic and Russian.

Brian Saab, Booking.com’s global head of marketing, says his company already has partnerships with about 2,800 lodging owners, ranging from guesthouses in Spain to apartments leased in Croatia. Booking.com says another 3,600 lodging owners have signed up for it.

“Some have no web presence at all,” Mr. Saab says. “Some you just need to improve it.”

The new service could give Booking.com an advantage over its competitors in generating income from the many thousands of small hotel operators scattered throughout the world. These owners sometimes are reluctant to pay fees to online travel agents, where prices can run as high as 25% of room revenue.

BookingSuite’s 10% commission is below the starting 15% rate that Booking.com typically charges hotels. But Booking.com is also looking to get additional fees from these hoteliers for services like search-engine marketing and other ways to raise their stature on Google and other search engines.

The BookingSuite service is a beefed-up version of buuteeq, a Seattle-based company that provided online marketing for hotels. Booking.com’s parent company, Priceline GroupInc., acquired buuteeq in June for an undisclosed price.

Booking.com lists more than 590,000 hotels and accommodations in about 200 countries.

Source: http://www.wsj.com/articles/booking-com-to-create-free-websites-for-small-hotels-1429704181