The Evolution and the Future of Business-to-Business (B2B) Hotel Distribution

Over the past few years, several startups have been disrupting the hotel distribution space. They are here to transform how you sell your hotel rooms to businesses and end customers. And they’ve got potential!

In this article, we’ll help you understand more about this innovative hotel distribution technique and whether you should consider it for your property.

Is Business-to-Business (B2B) Hotel Distribution About to Change?

“Hotel distribution is a highly intermediated multi-billion dollar business that runs on a complex network of GDS, Bed Banks, Channel Managers, and Connectivity Providers. This complexity is the result of years of small transformations, each new change adding some incremental value to the whole distribution chain,” says Carlo Alvarez Spagnolo, Managing Director at Apaleo (an API-first hospitality platform).

Selling hotel rooms is quite complicated. Hoteliers often pay very high commissions to middlemen like OTAs and other travel platforms to acquire new business. In the meantime, OTAs continually fight amongst themselves to keep the data flowing between different systems.

Global Distribution Systems (GDS) seem to struggle to stay relevant; while Bed Banks and Wholesalers are becoming stronger, keeping their inventory in a tight grip and making huge profits. It seems obvious that B2B distribution is ripe for change. But how?

Over the past decade, there have been several attempts to compete, overlook, or surpass the GDS. Lufthansa Airlines left the GDS for a while to only accept bookings via their website. It did not work, and before long, the airline was bookable on GDS again. Ryanair delayed selling via GDS for several years before they decided to change their mind and join the rest of the airlines to be available to book on the GDS.

In other words, GDS appears to be the main place to go for airline bookings, regardless of the volume of flights we’re experiencing. Even if the GDS seems ripe for disruption, hotel distribution is different from airline distribution. So, the question is: will the GDS become less and less relevant for hotels?

What is the Future of Business-to-Business (B2B) Distribution?

As we’ve seen above, the belief is that GDS is outdated and that it’s possible to establish a more direct and open distribution. New and existing businesses are trying hard to deliver change.

However, there is a possibility that will revolutionize previously go-to technologies, high costs, and slow integrations. In fact, there may be a way where hoteliers will be able to work directly amongst themselves, negotiate better deals, and reach a wider audience. And that is Distribution 2.0.

What is Distribution 2.0?

Distribution 2.0 is a term that was first used by Hyperguest. Distribution 2.0 is an attempt to build a new GDS, allowing the hotel to sell its rooms to thousands of travel agents and Online Travel Agent (OTA) websites without needing a contract and paying each one separately. Ideally, without the expensive fees, commissions, and aging tech of GDS solutions.

What is Open Distribution?

Open Distribution is a term that was coined in 2022 by Impala. Open Distribution envisions a world where hoteliers can work together to gain access to a worldwide audience and attract more guests to their properties.

With Open Distribution, several players work together without getting in each other’s way. Moreover, they can access new technology and updated inventory to build better, more exciting products and services. Furthermore, they can earn more of the revenue they generate as compared to older models.

Hospitality Marketplaces: The Next Generation of Business-to-Business (B2B) Hotel Distribution?

A hospitality marketplace, as the name suggests, is an online hub where hoteliers and distributors connect and integrate on simple and understandable terms without the presence of any intermediaries.

For instance, when a property connects its Channel Manager or Property Management System (PMS) to the hospitality marketplace, hundreds of distributors get access to the property’s inventory, allowing them to sell rooms instantaneously without setting up any connection or signing a contract.

HyperGuest, an API-based travel platform, has used the term Distribution 2.0 to explain this new model of doing business. Similarly, Impala, a travel stack platform, refers to this model as Open Distribution.

Both these companies have the same idea - to help hoteliers sell rooms quickly and without any hassle. They’ve done this by creating a modern API that doesn’t require any deposit or invoicing. Everything is simple, from contracts to payments.

The following are the primary benefits of a hospitality marketplace:

• Easy integration — With the help of a universal API, hoteliers and resellers only need to create a connection once and get started. Thanks to a modern interface, there’s no need to manually map content or code anything. The marketplace pulls prices, availability, inventory, and content from the hotel’s PMS so that resellers can start selling rooms immediately.

  
  

• Decreased overall costs — In this model, the whole distribution channel is revamped. Instead of multiple players, there’s just one intermediary. So hoteliers only need to pay a single fee to get business, instead of paying a fee to multiple distribution channels. Moreover, in some • cases, hotels get to upload their inventory for free and only the resellers have to pay a commission.

  
  

• Simpler payments and contractual terms — One of the best parts about Open Distribution is that a hotel only needs to sign one single contract and sell rooms on several platforms and channels. Resellers no longer have to create different contracts with each hotel separately. Instead, this model provides users with a single dashboard wherein they can accept payments, negotiate costs, offer discounts, and create custom rates. Instead of long negotiations that are normal with GDSs, Open Distribution is straightforward.

  
  

Now that you know more about new hospitality marketplaces, it’s very obvious that they are very promising! Some prominent hotel marketplaces are:

SiteMinder is probably the world's most powerful hotel Channel Manager. It can connect your hotel to 450+ distribution channels and integrate with 350+ leading property management systems (PMSs) and 100+ Hotel Tech Marketplace Applications (RMS, Upsell, CRM, etc).

SiteMinder eliminates the time spent manually updating each of your channel extranets and produces detailed reports, allowing you to better understand the performance of your channels and identify booking trends.

You can see the status of all your channels through one single dashboard and connect to the hotel industry's most powerful global distribution systems (GDS) via their ‘GD' chain code.

As well as Booking.com and Expedia.com, here are some other channels which you can connect to through SiteMinder: Ctrip, Hotelbeds, AirBnB, TripAdvisor … plus 300 more!SiteMinder is also offering connections to many PMS, RMS, Booking Engines, and many other hospitality-specific solutions.

Reconline Seamless GDS is supported by our proactive RFP Sales Team and super-efficient Technical Support.

Reconline AG is a parent company of Supranational Hotels and Classic International Hotels and offers a unique combination of solid GDS connectivity, proactive consulting, and hotel promotion services. Hotels can work with Reconline directly, or with one of their brands, or via one of a good range of resellers and white label solution partners around the world.

RateTiger by eRevMax is considered a leader in Hotel Channel Manager, Rate Shopping, CRS, Booking Engine, GDS Distribution, Metasearch management, and Website Design solutions to independent boutique properties as well as small, mid-size, and large hotel chains and resorts worldwide.

RateTiger connects to over 450 distribution and technology partners worldwide. It has deep two-way integration with distribution channel partners, including Booking.com, Expedia, Agoda, Airbnb, Google, HRS, Hotelbeds, among various others. It also offers connections to leading PMS, RMS, CRS, Booking Engine, and other hotel technology systems for a seamless online distribution experience.

Data security and privacy are key aspects for RateTiger, hence the company is ISO and PCI certified as well as GDPR compliant. It provides 24/7 multilingual support to hotels globally to assist in revenue generation objectives.

Sabre GDS, consortia, RFPs, GDS marketing, travel agent commission processing, third-party integrations.

NETTOHOTEL is the ideal Partner when it comes to GDS distribution for independent Hotels and Small groups.

Whether you're an international chain, independent B&B, or boutique retreat, Impala lets you quickly reach lots of room sellers and their guests at once. We've reimagined the technology of distribution, so you can attract more of the guests you want.

We take the pain out of selling your rooms, letting you access new markets and adapt to a changing world. Impala gets you started in less than 48h, with no upfront costs and no minimum number of bookings.

With Impala, you decide where your rooms are sold and for how much commission.

• Onboarding takes minutes, not months. Our new tech does away with the old connectivity and integration headaches. Just say yes, and we'll take care of fetching and updating your content, rates, and availability.

• Avoid the long back-and-forth on contracts. You don't need to sign a contract to start selling on Impala.

• You decide where your rooms are sold. Reach new markets and attract the guests you need to drive revenue and occupancy.

• See which channels are working best. Negotiate deals directly with room sellers to bring in more of the guests that are most valuable to you.

Roibos is the most complete solution for your B2B Hotel Distribution that allows you to offer your rooms to travel operators directly without intermediaries at the click of a button. Roibos helps you to increase both direct and indirect sales whilst simultaneously providing full control of your distribution. Hotels in Roibos Marketplace unlock access to Travel Agencies from all around the world.

Roibos Hotel Distribution Marketplace offers:

• Direct contracting between Hotels and Agencies

• We are not another bedbank but a technological platform that allows seamless connectivity.

• Your Hotel can be live in just 15-20 minutes, depending on the channel manager and the complexity of the range of rooms you have.

• Our Marketplace operates with more than 20 channel managers... surely yours is already integrated, and if not... tell us and we will integrate it shortly.

• Each reservation is secured with a VCC – Virtual Credit Card.

• Your hotels will be available in 9 languages thanks to our translation algorithm and your photos.

• You only map once. No more complex integrations or yearly agreements.

Travelgate (a Travelsoft company) is a comprehensive software solution designed to streamline sourcing and distribution in the hospitality industry through its extensive travel market network.

Product FeaturesTravelgate offers a versatile suite of tools for accommodation sourcing, featuring both pull and push integration options. The Pull Connection allows users to send a personalized request to the largest network of hotel sellers, enhancing hotel search times and booking accuracy. The Push Connection provides a standardized API ensuring an always-updated inventory and seamless integration. Users gain full control and transparency over all transactions, making it an ideal solution for wholesalers, channel managers, and accommodation providers.

Main AdvantagesTravelgate excels in its ability to connect users to over 40 channel managers, offering unrivaled time-to-market and scalability. The platform's extranet allows detailed management of hotels, rates, and rooms, ensuring complete ownership of your stock. Additionally, Travelgate's solutions offer unparalleled response times and sales optimization through its high-speed cache app and traffic optimizer.

Applications and Integrations Travelgate's marketplace is designed for growth, featuring a self-service portal with specialized apps that include Smart Traffic Monitoring, Business Intelligence, and Traffic Optimization. The platform also integrates third-party solutions like hotel mapping and transfer services to enhance the customer experience further.

Global Distribution channels and cutting-edge technology form the backbone of a revolutionary programme built for today's world of travel. With a reach of over 60,000 Travel Agents generating 14,000,000+ room nights. We are redeveloping the modern era of travel.

Fastpayhotels is an advanced B2B hotel distribution platform that brings control, transparency, and efficiency to the next level.

Founded in November 2015, Fastpayhotels focuses on evolving hotel distribution by offering a digital-first approach. With over 300 hotel chains onboarded and a direct inventory of more than 40,000 properties in 138 countries, Fastpayhotels sets itself apart with its non-refundable rates, efficiencies, and full rate distribution model.

Key features of Fastpayhotels include a powerful IT system developed with the backing of Magenta Partners. This system ensures automation and digitalization, reducing operational costs and allowing competitive pricing. The platform connects travel agencies worldwide, providing a comprehensive suite of solutions around connectivity, customer service, and big data to maximize margins.

Fastpayhotels leverages a team of motivated and skilled professionals across four global locations: Mallorca, Madrid, Cebu, and Santiago. The company prioritizes flexible work schedules, teleworking, and ongoing training to foster a supportive and innovative work environment.

By prioritizing automation and scalability, Fastpayhotels continues to enhance hotel distribution, connecting partners to a streamlined and efficient business model.

Katanox makes selling hotel rooms effortless. The OTA duopoly, GDSs, and Bedbanks have extended control over hotel distribution, hindering new entries into the market.

An extremely fragmented technical infrastructure heightens the entry cost.

Opening up hotel distribution in today's landscape of e-commerce platforms, mobile apps, and chatbots will provide hotels with direct bookings through many more channels and will provide travellers with more choice to find the best deal.

What is a Global Distribution System?

As the name suggests, GDS is a global reservation system that acts as a middleman between travel suppliers and bookers - including hotels, flights, cab providers, etc.

Everything you see on the system is live, accurate, and automated. And since COVID, all types of hotels are beginning to see the benefits of the service to attract a bigger audience. To know more about GDS systems, check out our comprehensive GDS Systems guide made for hoteliers.

However, please note that independent property owners can't connect to GDS Systems directly and have to tap into the B2B Distribution landscape and use a GDS Connectivity Provider.

Why Connect Your Hotel to a Global Distribution System?

Now, before you start reading about GDS companies and GDS providers for hotels, you may wonder why you need to connect to the service in the first place, especially if you're already on OTA platforms like Booking.com and Airbnb.

Here's why: a GDS provides additional revenue that a hotel or property cannot make in any other way. When a travel agent logs into GDS to book a hotel, they will not find your hotel there and won't book it, because it doesn't exist on that platform. After all, it's a global distribution network, and if your hotel isn't on it, you're simply missing a significant chunk of the revenue stream.

When properly managed, bookings received via GDS are much cheaper than OTA bookings and don't diminish the hotel's business of getting direct bookings. This makes it clear that if your property isn't connected to a GDS provider, you're missing out on bookings that you won't get from anywhere else.

How to Choose the Best GDS Connectivity Provider for your Hotel?

Global Distribution System Providers aren't new. They have been around for decades and have a consistent and dedicated user base, aka travel management companies (TMCs). When you get your hotel onto a GDS system or even just on the top GDS in the world, you get a chance to expand your hotel's reach further than ever before. It's a good marketing strategy if you're currently looking for one.

While there isn't an accurate or fixed answer to the question, 'Which is the most popular GDS system in the world?' This article will help you choose one that's best for your hotel.

Furthermore, any GDS you choose should function just as any other integration you have - it should simply connect to your hotel's Channel Manager seamlessly. So here's covering the basics:

Simple and Efficient

One of the most essential things to look out for when choosing a GDS is prominent hotel GDS providers that are designed for the business. That means they should have an extranet that connects to your existing tech stack and should be user-friendly and efficient.

Vast Network

Another thing that you must look for when going through our GDS systems list is that your hotel should use a GDS that positions you such that you receive special pricing queries from corporations looking for large booking volumes. These inquiries are Request for Proposals (RFPs) and are often managed directly by the GDS provider.

RFP Support & Management

RFP Management can be a separate thing, managed usually by the hotel’s sales team. Agreed rates can be simply updated once a year in the channel manager or the GDS CRS directly.

What is unique, though, is the fact that hotels can offer additional commission to travel agents making bookings as a form of an incentive. This can be visible on the agency side of GDS, and travel agents can choose hotels based on their location, pricing, and commission offered.

Additional Features

If you're asking, 'Which GDS is best for travel agents?', you're asking the wrong question. Instead, you should think about getting your hotel on a GDS that has the ability to offer additional commission to travel agents making bookings. Most hotels do that with (Best Available Rate) BAR bookings, but if there are special rates agreed upon for certain companies, the bookings are usually non-commissionable.

What to Look for in Your Global Distribution System (GDS) Connectivity Provider?

When going through Global Distribution System companies or providers, here are some basics that you must look for:

1. Seamless and complete control over rates and availability visible on the GDS.

2. Option to work with the GDS provider on generating new sales and revenue streams.

3. Control over any content or images visible on the GDS of your hotel.

4. Ability to review and change GDS presence and hotel comp set presence.

5. The total cost of booking acquisition, including all set and RFP Management related fees.

6. Technical integrations with channel managers, PMS, and other tech stack.

7. Automated reporting and statistics with insights.

8. Information on GDS intelligence, travel agencies, TMCs, consortia, and more.

9. Prompt and efficient customer support and/or training resources.

Which is the Best GDS System for Your Hotel?

There's no one answer - hotels should be present on all GDS providers simultaneously to access all travel agents. This is mainly because different travel agencies use different GDSs. If you want your hotel to be visible to all travel agents around the world, then presence on all GDS systems simultaneously would be advised.

When working with a top GDS provider, hotels should be able to connect to a Channel Manager and receive maintenance-free bookings. Rate Parity is key, and special corporate rates (coming mainly from corporate RFPs) should be managed by your ‘good’ GDS provider efficiently.

Additionally, Corporate Rate Loading Instructions (RLS) usually include a mix of different agencies using different GDSs. This means that hotels might be required to register with a particular GDS as a condition to work with a particular TMC. To know more, read: The Big Players of B2B Hotel Distribution.

Not all GDS companies provide the same type of GDS service in all locations, so what can work well in one of the major cities in the USA may not be able to bring the same result in the EU, and the other way around. Therefore, check out the best GDS Systems list to find the one or more systems right for your hotel:

B2B Distribution as an Essential Part of Your Growth Strategy

While the B2B hotel distribution industry is complicated, the primary goal is to allow accommodation providers to have seamless and effective exposure to inventory. At the same time, it lets travel providers effectively and effortlessly search and book inventory, without any need for a pre-existing relationship with the hotel.

Contrary to popular belief, it isn't required for the hoteliers to understand the entire ecosystem. Simply put, B2B distribution allows a property to sell room nights to a wholesale travel agency or B2B distributor to be sold later to a retail travel agency.

It's important to note that most platforms include a specific payment module that eliminates comprehensive reconciliation processes. Additionally, they include a content module, allowing hoteliers to control the data and images of the property.

How to get Started with B2B Hotel Distribution

A B2B distribution sales channel, which is actually a sum of channels, can often generate doubts about the operation due to the complexities involved. However, what is clear is that the ability to sell directly to the wholesaler or retailer, thereby avoiding intermediaries, is always the best choice.

The three biggest Global Distribution Systems (GDS) include Amadeus, Sabre, and Travelport. Since these can't be accessed directly, you need to go through GDS connectivity providers.

Bed banks, specializing in contract supply from accommodation providers and hotels (mostly long-haul international holiday destinations), make the service available to sellers that aggregate demand from multiple sources, such as traditional travel agencies, small and medium tour operators, budget airlines, etc.

Wholesalers, on the other hand, partner up with hotels by purchasing rooms for resale on a B2B network. Typically, they act as the interface between a travel agency and a hotel.