Merchant Model Programs

Online Travel Agents such as Travelocity, Orbitz, Priceline and Hotwire are increasingly attracting customers looking to book hotel reservations. Partner with this sites and increase exposure and reservations for your hotel.

What is a Merchant Model program?

A merchant model (MM) program is a non-commissionable negotiated rate offered by a hotel to a Travel provider, which is marked up for resale. The hotel’s inventory may be sold unbundled or packaged with air travel and/or car rental. The hotel’s brand may display to the customer or may be hidden until the reservation is confirmed (opaque).

The rate requirement and inventory commitment varies by program. Typically, the rate requirement is anywhere between 20 – 50% off the hotel’s non- restricted/published best available rate. The Travel provider is most often an Online Travel Agent (OTA). Examples include Travelocity, Orbitz, Expedia, Priceline and Hotwire.

What is the benefit?

The benefit of participating in a MM program is typically being listed on a high traffic site or getting priority placement on a site if previously listed with retail rates. The result is increased reservations.

How do MM programs work?

A hotel with a $125 best available rate provides a negotiated rate of $100 for example to Travelocity. Travelocity will mark up this rate to $125 and resells on www.travelocity.com. By participating, the hotel gets listed higher among competitors in the search results for their destination. If a guest books the $125 rate, the guest pays the OTA $125 and the OTA pays the hotel $100 (The credit card sent to the hotel for payment is that of the OTA).

How are MM programs managed?

This varies by OTA. Rates and Inventory can be supplied directly to the OTA through a separate portal commonly referred to as an “extranet” or the hotelier can manage the MM rates and inventory through the Central Reservation System (CRS) in the same way the hotelier manages retail, corporate negotiated and consortia rates and inventory. Managing MM through the CRS eliminates the need to manage multiple channels and makes rate and availability parity easier to obtain.

Which MM programs are available to InnPoints clients through MyCRS?

InnPoints Worldwide offers many merchant model programs to clients. Here is a summary of the programs highly recommended for must markets. For full program details and contracts, contact your InnPoints Account Manager.

OTA
PROGRAM
RATE CODE
Typical DISCOUNT LEVEL
Typical MARK UP%
Area of website where product sold

Priceline/
Travelweb
Priceline/
Travelweb Merchant (hotelonly)
HDS
25%
33.33%
www.priceline.com – select hotel tab/ www.travelweb.com
Priceline Opaque
CTJ, CT1, CT2
30%
aprx. 15%
www.priceline.com – Under “name your own price” select bid now (hotels)
Priceline Packages
CT5
30%
varies
www.priceline.com – select vacations tab

Orbitz Orbitz Merchant (hotel only)
LDC
25%
33.33%
www.orbitz.com – select hotel tab
Orbitz Packages
OBP
30%
varies
www.orbitz.com – select custom packages tab

Travelocity Travelocity Merchant (hotel only/unbundled)
TN1
25%
33.33%
www.travelocity.com – select hotel tab
Travelocity Packages (bundled)
TP1
30%
varies
www.travelocity.com – Vacation packages tab
Travelocity Last minute deals (distressed)
S59
35%
varies
www.travelocity.com – Last minute packages tab

Hotwire Hotwire Opaque
HW0
30%
aprx. 15%
www.hotwire.com – select hotel tab

How does a hotelier ensure they are getting the most from MM Programs?

  • Sign up today!
  • Work with your InnPoints Account Manager to ensure rates and inventory are available and at parity with similar programs.
  • Work with the OTA’s Market Manager to get the best placement possible for your destination.
  • Review Market production reports provided by the OTA.
  • Be flexible on pricing. Adjust pricing depending on market conditions (Some OTA market reports will indicate the best price point).
  • Seriously evaluate any program that requires a higher than standard discounted rate or committed inventory.