November 25, 2014
Amazon is partnering with independent hotels and resorts to offer a prepaid booking service via a new site. The initial rollout will feature select locations within hours of New York, Los Angeles and Seattle. The online retailer is expected to collect a standard 15 percent commission for prepaid bookings. Amazon Travel is likely to mirror existing hotel booking sites with pricing details, room availability and photos, and is expected to launch as early as January 1, 2015.
“Amazon’s mission is to create a marketplace for retailers who might have a difficulty finding customers,” especially for those independent and boutique hotels with limited marketing resources, reports Skift.
Amazon Travel curates hotel options using TripAdvisor ratings for hotels ranked four stars and above. Given Amazon’s reputation as a popular online destination, hoteliers are enthusiastic about the opportunity to expand their reach. Additionally, this new service could provide Amazon with an opportunity to match products with travel and destinations.
Hoteliers reluctant to join Amazon Travel have been those who are discouraged by the payment plan. According to Skift, “Amazon appears to be starting off with prepaid booking” and so “[hotels] would have to wait to get paid by Amazon in two payments.” Hotels would much rather use Amazon to gather bookings, collect money at checkout and pay Amazon its commission fee.
Many have compared Amazon’s new service to Booking.com, a hotel and vacation resort site.