Hoteliers Warned There’s No Room To Relax After Amoma Downfall

A leading distribution intelligence software company says its work with hotels to shrink Amoma's inventory was one of the driving forces behind the downfall of the online travel agency (OTA), and is warning hoteliers they need to do more to protect their inventory.

Fornova, which works with many of the world's largest hotel brands, says it made five times more test reservations on Amoma between July and September this year compared to the same period last year, suggesting a clear focus by its customers to reduce leakage to the site and take back control of their inventory.

Although many hoteliers welcomed the demise of Amoma, which undercut hotels on price, Fornova's CEO, Dori Stein, warns that without action hotels will continue to be at the mercy of wholesalers and uncontracted OTAs.

He said: "The downfall of Amoma is just the tip of the iceberg - it does not solve all of the hoteliers' problems. There are many more sites just like them waiting to pick up their inventory. Amoma was just one of the better-known providers."

"In the last year, we've seen the larger OTAs also move into this market, buying inventory from wholesalers in a similar way and offering rooms at a lower rate than the hotel's best price. With globally recognised brands now operating in the same way as the likes of Amoma, the risk for hoteliers, and their guests' consumer rights, is even greater."

"The best way for hoteliers to protect themselves from being undercut is by taking their distribution health more seriously and clamping down on inventory being sold to these uncontracted sites by wholesalers. We're already seeing the larger chains intensely focusing on this challenge."

Stein says there are three drivers behind Amoma folding - not all of which are good news for hoteliers.

He said: "The first reason is the pressure they were feeling from the larger OTAs who, in the last year, have evolved to also become marketplaces sharing both the rate they've agreed with the hotel and the sourced rate from wholesalers, effectively undercutting the agreed rate."

"That not only negatively impacted Amoma, but it also constitutes bad news for hoteliers and their guests. Just as with the uncontracted sites like Amoma, guests have fewer consumer rights when buying from these marketplaces, including around cancelation, and the hotels continue to be undercut."

"Secondly, Amoma had seen a significant reduction in its inventory. Through our software and guidance, hotels have been able to identify the wholesalers that have sold each room. They then took steps to stop their inventory being sold to Amoma. For us, it's rewarding to see our work delivering such significant results."

"Ensuring rooms are reserved either directly through the hotel or a contracted OTA is the best outcome for both the hotel, which can secure its margin, and for guests who have all their rights protected."

"Finally, most hotels have moved away from static rates to become much more responsive to demand and, as a result, the inventory available to wholesalers has been reduced as the number of direct bookings and sales from contracted OTAs increases."

While there's no doubting that hoteliers around the world breathed a sigh of relief at the news of Amoma's demise, it is clear that that there's no room for hoteliers to become complacent in the drive to offer the most competitive room rate.

About Fornova

Fornova empowers the global travel and hospitality industry to optimize distribution, generate demand and maximize revenue by delivering best-in-class, data-driven Business Intelligence solutions.

Our clients include most of the world's top 10 largest hotel groups, the biggest global OTAs, hundreds of smaller brands and independent hotels, as well as car rental companies and booking sites. Our solutions enable their entire organization (from revenue and distribution to sales, e-Commerce and operations) to make better decisions faster, navigate through changing market environments and stay ahead of the competition.

We track 100,000 hotel brand.com, OTA, metasearch & car rental websites every day, and using our patented technology we monitor 1.25 billion rates from over 70 different countries (Points of Sale) every month. In 2020 we celebrated 10 years in business, having grown to 200 team members based in 10 countries across four continents.

Alison Ellis
PR Manager
+44 (0)1224 900067