Booking.com experiments with star ratings to test price sensitivity

August 24, 2017

An August 4 article in the popular UK site MoneySavingExpert.com revealed that Booking.com recently ran an experiment with Morgans Hotel Group to see how star ratings impact bookings.

During the test, Booking.com advertised the Hudson Hotel in New York as both a three-star and four-star property under slightly different names. (Note that star ratings for hotels around the world are accredited under varying systems, with the U.S. star ratings being much more flexible than its U.K. counterparts.)

The test for Hudson Hotel had the four-star listing offered at a slightly higher nightly rate at £5 more per night:

Unfortunately, Booking.com got caught running the experiment after a customer noticed the double listing at the two different prices. The Hudson Hotel was quick to point out the price disparity was a mistake, and that it only ran the experiment to compare different star ratings.

In a statement, Booking.com referred to the trial as “a one-off for one hotel only” and confirmed that the hotel is now only listing the four-star option.

However, this example clearly indicates a willingness for OTAs to offer a testing ground for hotels. Based on that prospect, what kind of benefits might such an opportunity present?

The benefits of A/B testing

For e-commerce sites, the value of carrying out ongoing tests on a website can’t be overstated. In the case of Booking.com, they never make a single adjustment to their website without validating it first. This attention to detail is a big reason for their continued success in the battle for direct bookings.

Commonly referred to as A/B testing, this comparative process involves changing just one element of a website at a time to see which change yields the most effective results.

While A/B tests can be conducted independently, not all hotels have the resources to do so. In the case of the Hudson Hotel, they simply instructed Booking.com to carry out the work on their behalf. This alleviated the burden of them having to deal with a technical and time-consuming process.

Working with an OTA also offers a huge advantage in terms of sample size. Thousands of customers visit OTAs such as Booking.com each day. Compared with the amount of traffic a hotel website receives, conducting an A/B test in front of a much larger audience can provide far more statistically relevant data.

As for the specific benefits of this process? Having an optimized OTA listing can help a hotel stand out against the competition and increase conversion rates. In addition, any insights gained can be applied to a hotel’s own website to help increase direct bookings.

So which elements of a listing are best to test? While there’s no right or wrong answer, there are certain compelling aspects of a hotel listing that travelers frequently focus on.

What aspects of a listing are best to test?

The Hudson Hotel’s decision to test star rating is just one of myriad experiments available to try. It allows a hotel to see whether the search volumes of three- or four-star hotels are higher, and whether their particular listing converts better based on the star rating.

Testing other parts of an OTA listing could also prove highly beneficial.

A study by Expedia revealed that imagery is one of the most powerful tools for increasing engagement and influencing decisions. So by optimizing the images you use to showcase your property, you stand to win more attention and potentially increase bookings as a result.

A great place to start testing images is the feature photo of your property on the initial OTA search results page. Catching attention at this early stage can ensure you grab attention as shoppers quickly scan through other options.

As for the type of photos that work best? Expedia’s study found that a bedroom with a window view generated the most positive feelings, while beautiful vistas and interesting shots of a hotel also proved highly engaging.

However, testing various photos of your property and destination will reveal how specific images improve engagement with your own potential guests.

Promoting perks and extras can also help a listing stand out when other properties are competing on price. But what perks and extras are your potential guests interested in?

Maybe it’s free breakfast, free Wi-Fi, or the option to book now and pay later. Experimenting with two variations of a listing with these kind of options will give you a much clearer idea.

A lot of OTAs also feature a small section of text below a listing to sell its most attractive qualities. With limited space here, every word counts. By fine-tuning this text, you may discover that promoting proximity to local landmarks rather than your hotel’s amenities has a positive impact on booking levels.

After users click on your listing, the amount of potential tests can be expanded to an array of other on-page elements.

For instance, Booking.com lists a “Most popular facilities” section (Expedia has an equivalent “Popular property highlights”) that let a hotel prominently promote a limited number of perks. Again, these sections provide obvious opportunities for experimentation.

Potential bookers are also going to be looking for specific information on your hotel’s room options as they move towards a booking decision. Trialing variations on your copy at this point can be useful to measure the impact of highlighting different room selling points.

Finally, if your location is a compelling attraction, you could experiment by promoting different destination highlights and points of interest to see if this impacts engagement levels.

The benefits of running tests with an OTA

For now at least, we’re not aware of any OTAs officially offering hotels the chance to carry out tests with them. But the Hudson Hotel example certainly indicates a future possibility.

If new opportunities do arise, maintaining consumer trust through such an experiment would obviously be paramount. For the Hudson Hotel, an error with pricing led to a costly PR mistake and a potential guest feeling misled.

However, done in the right way, being able to harness the technical expertise and audience of an OTA would be of huge benefit for any hotel to refine their listing and apply any lessons learned to their own websites.