Summary: ‘Lights Out, OTA!’ a strategic move in hoteliers’ battle to regain control of their businesses, say participants<br> n April, when the coronavirus crisis had sunk hotel occupancies to unfathomable lows, online travel agent Expedia Group researched what kind of support hotels and other lodging providers needed to survive the downturn in business.<br> At the end of May, the company announced a $275 million global recovery program for what it calls its lodging partners.<br> Most of the funding is in the form of marketing credits and a 10 percent reduction in commissions on new bookings.<br> Expedia Group also has allowed hotels to defer by 90 days the commission payments the properties collect from guests who book on OTA’s channels.<br> But one group of hoteliers is not buying it.<br> Reform Lodging, a new organization with nearly 2,000 hotel owners as members, plans to protest commission rates being charged by Expedia Group and Booking Holdings.<br> Reform Lodging has launched Lights Out, OTAs!, during which its members plan to remove their hotels’ rooms from the OTAs’ inventory on Friday and Saturday.<br> It’s the hoteliers’ first planned attack to regain control over their businesses from both OTAs and franchisers, say owners.<br> Expedia Group declined our request for an on-the-record interview, but a spokesperson who asked not to be identified provided background information about its relief program.<br> The relief is available to owners of independent and branded hotels, but the franchisers of the brands are required to opt in.<br> <a href="https://www.linkedin.com/in/sagarshahycg/" target="_blank" rel="noopener noreferrer">Sagar Shah</a>, co-founder and president of <a href="https://www.reformlodging.org/" target="_blank" rel="noopener noreferrer">Reform Lodging</a>, said he has not heard whether major hotel franchisers are participating.<br> Shah is also managing principal of Yatra Capital Group, a family business that owns hotels and senior living facilities. He said Reform Lodging is a think-tank that represents the interests of hotel owners on a variety of issues created by the coronavirus crisis.<br> In a survey of 114 members, all but six agree that while OTAs are necessary in a crisis, their commissions are too high and threaten owners’ ability to turn a profit during the current downturn in business.<br> Shah recently attempted to get the attention of online travel agencies in a letter addressed to Peter Kern, CEO of <a href="https://www.expediagroup.com/" target="_blank" rel="noopener noreferrer">Expedia Group</a>, and Glenn Fogel, CEO of <a href="https://www.bookingholdings.com/" target="_blank" rel="noopener noreferrer">Booking Holdings</a>, in which he asked for financial relief in the form of reduced OTA commissions.<br> Reform Lodging’s letter, dated Aug. 13, is indicative of the type of advocacy the organization plans to practice in the coming months.<br> “We realize that the OTAs have been rather quiet with respect to what’s happening right now, and we felt it was necessary to strike up a conversation with them,” said Shah.<br> <br> {caption}DEAR OTA: Sagar Shah, co-founder and president of Reform Lodging, wrote this letter to Expedia Group and Booking Holdings to raise concerns about the online travel agencies’ commission rates it’s levying for reservations made through their various channels during the coronavirus pandemic. Also signing the letter is Rich Gandhi, co-founder and chairman of Reform Lodging.{/caption}<br> Shah and members of Reform Lodging also want to send a message to major franchisers that they, too, skim too much from third-party online reservations, increasing the cost of guest acquisition beyond what owners can manage at this time.<br> “When it comes to a franchised hotel or property we’re not directly negotiating with the OTAs,” Shah said. “It’s really up to the franchisers. They’re the ones who strike deals with the OTA partners.
