In today’s ever-evolving travel landscape, it’s no surprise that the relationship between hotels and OTAs is constantly shifting, with both sides navigating new challenges and opportunities in a competitive market.
This was the topic of debate at WiT 2024 between Choe Peng Sum, CEO of Pan Pacific Hotels Group, and Laura Houldsworth, managing director of booking.com.
It was framed as a classic stand-off between the two sectors, with Choe initially stating, “We’re not against paying commissions. Just lower your rates!” He later suggested, “Share your database and lower your commissions,” highlighting the growing pressure on OTAs to offer more value to hotel partners.
However, the debate soon revealed that the two are not enemies but rather interdependent partners who have little choice but to collaborate. In a friendly exchange, Houldsworth pointed out that only 2% of booking.com customers book the same property twice, a statistic that Choe swiftly dismissed, pointing to Booking Holdings' 2023 revenue of US$21.3 billion, where that 2% was "a drop in the ocean."
The conversation turned to the importance of customer loyalty, with Choe emphasising that going direct allows hotels to collect valuable customer data to improve their experiences. Houldsworth, however, countered that once a customer is acquired, they are “all yours” — a point that Choe immediately conceded. “The moment they come into our hotels,” he said, “it’s up to us to retain them as loyal customers.”
With a touch of humour, Choe remarked, “This isn’t much of a face-off,” acknowledging the mutual respect between the two sectors. Houldsworth also admitted that while OTAs may be perceived as costly, their global reach and marketing efforts — such as the Genius programme — provide substantial value for hotel partners looking to extend their reach across 180 countries.
The conversation turned to market segmentation, with both agreeing that understanding customer behaviour is key to pricing strategies. Choe noted, “Get the pricing right based on segmentation – like corporates, groups or millennials and Gen Zs who are more likely to use OTAs – and we won't cannibalize each other.”
Beyond business strategy, the two leaders discussed sustainability. Houldsworth acknowledged Choe’s commitment to sustainability at Pan Pacific, while Choe praised booking.com for its efforts to highlight eco-friendly hotels. “We want to give choice to travellers who want to travel within their own values,” Houldsworth said, noting that sustainable practices have now become standard and are no longer a niche offering.
In a final, reflective moment, Houldsworth summed up the discussion by saying, “We need each other. We want to work together,” signalling a mutual understanding between the two sectors that extends beyond competition.
As they left the stage, WiT founder Siew Hoon Yeoh jokingly remarked, “I didn’t want you two to be so friendly.”