eDistribution Hotel Strategies

Improve Occupancy

Improve ADR

Lower Distribution Costs

GDS

Internet

Help hotels and other travel suppliers improve revenue from electronic

distribution channels.

Meeting Hotel’s Needs

Competitive Data

• Hotelligence,• Internet

Hotelligence, RateView Enabling

Capabilities

• Web Booking Engine• GDS Connectivity• Call Center Reservations• Channel Management• Electronic Marketing Centre

E-Marketing

Sabre, Galileo, Worldspan, Amadeus,

Orbitz, Hotwire, USAToday

Services

• Website Design• Call Handling• Search Engine

Optimization• Search

Marketing• Local Advice

Putting it all Together

To Improve

Performance in

Electronic Channels

Competitive Data

E-Marketing

EnablingCapabilities

Services

Why the Focus on Electronic Channels?

2005 Hotel Revenue Forecast($Billions)

Travel Agent GDS

$12.4 B

Web Direct to Property/Chain Sites

$7.8 B

Retail/Net Rate/Opaque Third Party Web Sites

$5.9 B

Expected to deliver over $26 billion in room revenue in 2005

Hotel e-commerce is becoming increasingly important for the hospitality industry

CRO distribution continued to shift in 2004 toward the more cost-efficient electronic channels

Based on TravelCLICK’s eTRAK Industry Report for 2004

Global Distribution Systems began in the early 1980’s

Over $250 billion of travel sold through these systems

Largest e-commerce marketplace, far surpassing total business transacted on the Internet

Originate about 700 million inbound travelers a year worldwide

The World’s Largest e-Commerce Marketplace

Source: TravelCLICK’s Proprietary Database

$12.1 USD Billion GDS Marketplace

0

5,000,000

10,000,000

15,000,000

20,000,000

25,000,000

30,000,000

35,000,000

40,000,000

45,000,000

50,000,000

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005E

GDS Hotel Bookings

GDS Hotel Booking Revenue Increased by 14.3% in 2004

Internet channels are still growingly rapidly, and have become relevant

1.502.50

3.50

6.00

7.50

10.30

$0

$6

$12

1999 2000 2001 2002 2003 2004E

Hotel Revenue From the Internet

($Billions)

Consumer Online Spending - Hotels

TravelCLICK estimates that six out of ten households now consult the Web for travel

Internet Use on the Rise

Consumer utilization of the Internet to plan some aspect of a trip continues to rise

55%

69%

53%

63%

0%

10%

20%

30%

40%

50%

60%

70%

Business Leisure

2002

2003

YPB&R/Yankelovich Partners 2004 National Leisure Travel Monitor

Lookers to Bookers

The rate at which consumers are using the Internet to book travel services is growing even faster

33%

51%

32%

45%

0%

10%

20%

30%

40%

50%

60%

Business Leisure

2002

2003

YPB&R/Yankelovich Partners 2004 National Leisure Travel Monitor

Importance of e-Commerce Bookings % of Contribution to Rooms Revenue

Downtown Property

20-30%

4-10%

10-15%

47-65%

Property Direct

CRO Voice

GDS

Internet

Suburban Property

47-63%

9-12%

5-10%

25-35%

Property Direct

CRO Voice

GDS

Internet

Source: Business mix derived from samples of TravelCLICK”s database and other market information

Typical North American Hotels

Internet revenue consist of revenue contributed by chain website, as well as internet retail sites.

Property direct channel is comprised primarily by group business, but also includes revenue from calls made directly to the property, the property’s own web site and walk-ins.

Airport Property

40-50%

32-48%

5-12%

6-10%

Property Direct

CRO Voice

GDS

Inte

rnet

Resort Property

51-75%5-15%

7-14%

12-20%

Property Direct

CRO Voice

GDS

Internet

Typical North American Hotels

Importance of e-Commerce Bookings % of Contribution to Rooms Revenue

Internet revenue consist of revenue contributed by chain website, as well as internet retail sites.

Property direct channel is comprised primarily by group business, but also includes revenue from calls made directly to the property, the property’s own web site and walk-ins.

Source: Business mix derived from samples of TravelCLICK”s database and other market information

Data Solutions

For managing performance and competitive benchmarking in electronic channels

GM VIEW: Summarizes Pricing, Rate Parity, Best Rate GTD

Isolate dates where pricing is out-of-sync with the competition

Isolate dates where pricing is out-of-sync with the competition

Identify dates with increasing demand in advance

Identify dates with increasing demand in advance

Monitor best rate guarantee program and rate parity

Monitor best rate guarantee program and rate parity

Quick VIEW - Simple One-Page View of Competitive Market

Displays the lowest overall rate across all channels, enabling users to quickly gauge cross-channel competitive positioning

Shows a complete picture of pricing by channel for auditing purposes.

Easily identifies both rate parity problems as well as failures to meet best rate guarantee programs

Daily VIEW: A complete daily picture for all channels and competitors

Users define Price Watch criteria that will generate visual indicators when pricing for a competitor is higher or lower than an acceptable variance.

Users define Price Watch criteria that will generate visual indicators when pricing for a competitor is higher or lower than an acceptable variance.

Multiple Length of Stay VIEW: One page view of multiple LOS

Channel VIEW: A more detailed view of pricing by channel

If a price has changed from the previous week, the amount of the variance is printed in blue or yellow font below the current price.

If a price has changed from the previous week, the amount of the variance is printed in blue or yellow font below the current price.

Supporting Detail: Provides rate descriptions from each site

Identifies Merchant and Retail Rates

Identifies Merchant and Retail Rates

Corporate RateVIEW

Group properties together by area, region or brand

Group properties together by area, region or brand

Diagnostic “alerts” help manage rate parity across each property

Diagnostic “alerts” help manage rate parity across each property

Competitive Benchmarking

GM Summary

An overview of Market Penetration PerformanceKnow your hotels rank and market penetration for the current period vs. prior year in a glance.

Know your hotels rank and market penetration for the current period vs. prior year in a glance.

Identify top performing agencies in your market for future sales opportunities.

Identify top performing agencies in your market for future sales opportunities.

Performance Summary: Key Measures by GDS

Monitor market share and penetration by GDS compared to prior year

Choose monthly or year-to-date data

Choose monthly or year-to-date data

Visual alerts indicate when your market penetration is less than 100%.

Visual alerts indicate when your market penetration is less than 100%.

Performance Summary: Key Measures of Electronic Distribution

Understand 12-month market penetration and average rate trends

Compare ADR trends vs. competitive set and identify opportunities for growth.

Compare ADR trends vs. competitive set and identify opportunities for growth.

Evaluate trend of market penetration for room nights and revenue.

Evaluate trend of market penetration for room nights and revenue.

Distribution Summary: Account Performance in Your Market

Subscribers may request up to 150 total agencies

View monthly and year-to-date informationView monthly and year-to-date information Defined Criteria

Identify which travel agencies book your hotel and your competition, identify target accounts to solicit for business opportunities.

Identify which travel agencies book your hotel and your competition, identify target accounts to solicit for business opportunities.

Totals appear at top for easy viewingTotals appear at top for easy viewing

Distribution Summary: Top Producing Cities and Countries

View monthly and year-to-date informationView monthly and year-to-date information

Select competitors top cities and countriesSelect competitors top cities and countries

Revenue Management Summary

Lead Time Statistics identify booking patterns at your hotel and the competitive set.

Lead Time Statistics identify booking patterns at your hotel and the competitive set.

Revenue Management Summary

Lead Time Statistics identify booking patterns at your hotel and the competitive set.

Lead Time Statistics identify booking patterns at your hotel and the competitive set.

Revenue Management Summary

Understand customer stay patterns in your market

Understand customer stay patterns in your market

A platform from where hoteliers can manage inventory and rates across multiple retail and merchant sites

Channel Manager Coverage

The top sites (and their affiliates) capture ¾ of the total on-line visits

Travelocity.com, WorldRes and iHotelier to be added by June 2004

Lodging.comLodging.com ExpediaExpedia OrbitzOrbitz

The Way It Works Today

Hotel Property

ProprietaryExtranet

ProprietaryExtranet

ProprietaryExtranet

ProprietaryExtranet

ProprietaryExtranet

ProprietaryExtranet

Net Rates & InventoryNet Rates & Inventory Net Rates & InventoryNet Rates & InventoryNet Rates & InventoryNet Rates & Inventory

Manual inputManual inputManual inputManual inputManual inputManual input

The Way It Will Work with Channel Manager

Manual Input into ONE LocationNew Rates & Inventory

Manual Input into ONE LocationNew Rates & Inventory

Reservation Count

ProprietaryExtranet

ProprietaryExtranet

ProprietaryExtranet

ProprietaryExtranet

ProprietaryExtranet

ProprietaryExtranet

EmulationEmulationEmulationEmulationEmulationEmulation

Merchant.comMerchant.com

Retail.comRetail.com

Reservation Count

Destination.comDestination.com

Hotel Property

Channel Management Platform

ChannelManager’s Economic Value

$50k salary x 20% of the RM’s time= $833

250 room hotel @ 70% occupancy @$175 ADR

generates $918,759 in revenue a 2% increase due to better

Revenue Management would yield incremental revenues of= $18,375

4 Suites per month (incremental) @ $200 (2 night stays)= $1,600

3 new sites to the distribution portfolio

4 reservations from each site @ $150 (2 night stays)= $3,600

1

3

4

2

$24,408 * per month

$292,896* incremental revenues

per year

What’s the value of CHM to this hotel?

Electronic Marketing

For increasing business in electronic channels

ConsumerMedia Network

Travel Agent Media Network

Travel Agency Media Network

C O N S U M E R SC O N S U M E R S

An Increasingly Complex Maze

Reta

ilD

istr

ibu

tion

Th

rou

gh

Tra

vel A

gen

ts

TravelAgent

Pegasus

Chain

GDS

EST. CHANNEL15-40%

Local Hotel

Wh

ole

sale

r D

istr

ibu

tion

NEW CHANNEL1-20%

Dir

ect

Dis

trib

uti

on

Chain/Rep Co.

Ch

ain

/Rep

Co.

Dis

trib

uti

on

ExpediaHotels.com

Chain

InternetTravel Site

Pegasusor GDS

Reta

ilD

istr

ibu

tion

Th

rou

gh

Inte

rnet

NEW CHANNEL2-25%

NEW CHANNEL0-10%

Priceline

Chain

Au

cti

on

Dis

trib

uti

on

NEW CHANNEL0-8%

NEW CHANNEL1-3%

Local Hotel Local Hotel Local Hotel Local Hotel Local Hotel

We Focus on the Two Most Profitable Channels

$111.45

$130.00

TravelAgent

Pegasus

Chain

GDS

Local Hotel

GDS

55.00106.00 79.50

115.00

Chain/Rep Co.

Local Hotel

70.00

Priceline

Chain

Local Hotel

105.00

ExpediaHotels.com

Local Hotel

BrandWebsite

Merchant

Opaque

$109.00

$115.00

Local Hotel

PropertyWebsite

Booking

Engine

Provider

Reaches 87% of all Travel Agents worldwide – Over 640,000 Terminals

Statistics provided by each GDS

Our Travel Agency Media Network

Number of terminals worldwide

Sabre/Abacus 218,094

Galileo 158,917

Worldspan 52,297

Amadeus 211,809

1%5%

23%

30%

41%

0%5%

10%15%

20%25%30%

35%40%

45%

5=Highimpact

4=Someimpact

3=Mediumimpact

2=Littleimpact

1=No impact

Hilton Survey - 59% of Agents say GDS Ads Impact Decision-making

53%

47%

44%

46%

48%

50%

52%

54%

Made booking due to ads No response to ads

PLOG Study - 53% of Agents Have Booked a Hotel Due to GDS Ads

Traditional media response rates

Direct mail 3.0%

Print ads 0.2%

59%

Source: NFO Plog Agent Survey 6/03Source: Hilton Agent Survey 8/03.

Independent Research Shows GDS Media Significantly Outperforms Other Media Options

Ad Serving – How Does it Work?

Ad serving is the process of dynamically delivering targeted electronic advertisements (i.e. “serving ads”) into a variety of electronic mediums.

An ad server houses an advertisement and delivers it when the parameters for that particular ad are met.

Travel Agent

GDSAmadeus

GalileoSabre

Worldspan

Travel Agent enters search criteria into GDS

GDS sends request to Ad Server for an ad that meets criteria

Ad Server locates ad and serves it back to the GDS

GDS delivers ad to Travel Agent

GDS MarketingOne to One Real Time Targeting

                                       

Travel AgentTraveler

Targets• Ad Period• Promo Period• Point-of-sale Option

• Agent Sign-In Messaging• Agent Broadcast Messaging• Destination Air Shopping• Destination Air Booking• Destination Hotel Shopping• Destination Weather

Messaging

TravelCLICK’sGDS Advertising

Products

Hotel Advertises on GDS

Hotel Booking

First Screen Exposure- Hotel Availability

Detail Screen Display

Targeting Capabilities

Consumer Media Network

Our Consumer Network

Results Page

2 Skyscraper ads are available on the

Results Page

2 Skyscraper ads are available on the

Results Page

Banners & Badge ads are available on the

Results Page

Banners & Badge ads are available on the

Results Page

Landing Page

Hotel Detail / Show All Rates Page

Hotel Detail / Show All Rates Page

Skyscraper ads are available on the Hotel Detail Page and Show All Rates Page

Skyscraper ads are available on the Hotel Detail Page and Show All Rates Page

Destination Page Advertising

Page Sponsorship

Destination-specific banners are available on

hotel, air, car and package research result

screens

Destination-specific banners are available on

hotel, air, car and package research result

screens

Banner & Badge ads are available on Deals & Destination pages

Banner & Badge ads are available on Deals & Destination pages

Customer Reach

5-10

1,000-2,000

Daily Newspaper

Travel Trade Print

TravelCLICK Media

Potential Customers Reached Through $20K Expenditure

175,000-400,000

Direct Mail 1,000-8,000