Tuesday, March 24, 2009

"The AsiaRooms of 2009 is not the AsiaRooms of 2005": Interview with John Fearon, AsiaRooms Head of Marketing

 Hotel -  Hotels AsiaRooms is one of the region's largest online hotel retailers. With 81, 908 hotels and counting (according to the site today) and a parent company that is the largest travel company in Europe (TUI), AsiaRooms is clearly a player that the BOOT should be paying attention to. Historically the company has made this hard as it has been very secretive with its numbers and plans and (to be frank) was not a company we wanted to pay attention to. Prior to TUI buying the company, AsiaRooms built up an unwanted reputation on online customer care forums for complaints and among the trade for scoffing at rate parity and associated price guarantees. Rumours of wholesale group rates being market up $5 and sold online became the standard trade fair post-session beer story when AsiaRooms came up in the conversation. The brand buzz was all bad. In fact the customer and industry complaint forums became the only source for profile information on the secretive company.

John Fearon the (relatively) new Head of Marketing for the Pattaya based AsiaRooms is determined to change all that. Determined to build on the TUI brand and infrastructure support to change the market perception of AsiaRooms and to bring the company out from behind the secrecy curtain. As John told me “we are not the AsiaRooms of 2005”. I had a chance this week to (virtually) sit down with Fearon and hear his plans for changing the reputation of AsiaRooms, overhauling their marketing plans, ditching meta-search and taking on all comers in a press to be number one in Asia.

In marketing, John's first target is to change the approach to paid search marketing. SEM and SEO is the frontier that John believes will sort out the winners from the losers in Asia (I agree). Is also the place he was happy to share numbers and metrics with me. After only three months of work Fearon is claiming to have doubled the amount of business coming form the search engines on the same level of spend. Not much of a metric to share but an indication of his marketing plans. He had a lot less praise for and desire to continue to invest in meta-search. Has pulled AsiaRooms out of Kayak and has no plans to go with hotelscombined. For the moment is sticking with Wego but as general rule does not believe that meta-search builds a brand or helps the business. Claims it forces you into “killing yourself” on pricing at the expense of the consumer experience. This is an interesting point. I am working on a separate post on my thoughts on the meta-search model but from what I am seeing the arbitrage gap (difference between price meta-search players buy traffic from Google and sell it to suppliers) is narrowing.

In supply the plan is to continue to gain access to cheap inventory - but with less (he did not say none) of the rate rule breaking.

Asia is a tough place to play but Fearon is not worried. AsiaRooms claims that profitability and support from the rest of the TUI nline Destination Services (ODS) group will prove another important factor. [FYI the TUI ODA group includes the UK based LateRooms and Spanish Hotelopia].

They will need more than good paid search plans and mothership support to make it in this market. Fearon says he is aware of this, especially with the Global F’n Crisis hitting Asia hard. He predicts the GFC will bring down a number of smaller brands (we off the record speculated which ones). But for Fearon this is the opportunity to bring AsiaRooms out and take competitors head-on. He has not been impressed by any of the marketing activities of competitors from the big four (Expedia, Orbitz, Travelocity and Priceline). "There is nothing they have done that made me say Wow".

Was interesting to finally hear a (confident) voice from AsiaRooms and one not afraid to admit to the reputation. He acknowledged that AsiaRooms broke a lot of the pricing rules in the past (and maybe that they still do) but is now looking to invest in brand and customer satisfaction (heck they even have a facebook fan page now!).

So what do you think? The consumer forums still don’t paint a pretty picture for AsiaRooms but the company is claiming a lot of changes since 2005. Either way the Asian online travel market war has moved to a different level.


John Fearon said...

Thanks Tim,

We appreciate the blog post.

Maybe in the future there can be more number sharing as the business gets larger.

All the best


Julie said...


Thanks for the post Tim. It will be interesting to se ehow it all evolves.

My question is for John - how do I get our properties removed from asiarooms.com? We never authorised them to go on and after months and months of trying to get them off I gave up.


Jonathan Ersser said...

Hi Julie

I am not familiar with how AsiaRooms source content, but I would assume they connect with one or more wholesalers, channel managers, aggregators or other distributors for some of their listings.

If you supply inventory to any of the above, then your best chance of finding out how it has happened is to contact them and see if they make it available to other parties to increase distribution.

Tim Hughes said...

@julie and @jonathan - raises an interesting question. Is a retailer obliged to tell a supplier which wholesaler is being used to access in the inventory?

John Fearon said...

Hi Julie,

Quick disclaimer: I am not involved with the supplier relationships.

We work through multiple B2B (Pacific World, Tourismo Asia, Asian Trails, Gullivers and many others) suppliers.

I guess the easiest way to stop Asiarooms and other OTA's from selling your inventory is to stop supplying the B2B channels .

I know that's not great news but it would stop OTA's from selling your inventory.


Anonymous said...

I work for a publicly listed hotel chain ( so rather stay anonymous as our PR department prefer us not to comment in the public domain )

We also selectively work with meta search companies who can deliver incremental customers that have not been obtained through Arbitrage. We continue to work with Wego.com in Asia, as they have a really extensive network of sites which they power. If we tried to advertise with these sites directly then it would not be as attractive. In essence we get our hotel rates and deals syndicated via Wego.com to a whole new audience.

In the US we have a great partnership with Kayak as they have created enough Buzz over the past 4 years that they rely less on SEM.

We actually achieve better ROI with Kayak and Wego than on Google

I can not comment on Hotelscombined as we have never worked with them before.

Aloke Bajpai said...

Nice post :)

So long as us meta-search engines continue to drive quality organic traffic with no or minimal SEM, there is a huge "quality" gap between traffic from a meta-search and traffic from a horizontal search in terms of price paid per room night booked.

We run India's leading meta-search and this is what our direct hotel partners and hotel aggregators we work with tell us.

Interesting to know the "arbitrage" view though.


Jonathan said...

I commend what the meta-search sites have done (for users and themselves), but what I believe many Travel Distributors fail to see are the (in my opinion) negative long term affects of listing with these meta-search sites.

I could probably write an essay, but will just briefly touch on a couple of things.

Meta-search sites diminish distributors ability to compete on anything other than price and how much they can afford to pay the meta-search site per click in order to secure the top sponsored spots.

This makes it harder for them to build up a loyal user base of repeat customers and direct traffic through referrals etc, thus costing them each time to re-acquire previous and attract new customers.

Even their more loyal customers will end up checking the meta-search sites first and then click the link to them once they are sure there is not a much better rate available, costing the distributor a fee each time and possible lost business if someone does temporarily undercut them or is able to provide availability that they can't.

As price becomes even more of a driver than it is now, margins will be further eroded as distributors try to under cut each other, but will most likely lead to the further adoption of pricing parity.

With price parity being more widely adopted, distributors should end up competing more heavily on service and the ability to retain customers. Many users will still arrive at their sites through a meta-search site however, just in case there is a better deal available, once again costing the distributor a fee each time and possible lost business.

We all know what happened to the major vehicle hire companies when price became the focal differentiating factor.

Hotel chains who list directly with the meta-search sites will also be affected. They currently provide distributors with a fixed wholesale rate or a retail rate with a set commission, guaranteeing their (after direct marketing) revenue.

Meta-search sites however charge a CPC, so as competition becomes more fierce for the top spots for each location, you can bet that these CPC fees will increase to a much higher rate than the commission or difference between wholesale and retail that they provide to current distributors. This is the same thing that is happening with google, and google has a lot real estate to compete over based on an unlimited number of keywords as opposed to the meta-search sites.

Thankfully, we have anticipated this and have created a way and are creating more ways to keep customers coming directly back to our service to search for and book travel. If we did not have this competitive advantage however then I would be quite worried about what the future may entail if things continue on this path.

Julie said...

Thanks for the responses.

To be honest I have no idea where our listings come from. We only work with a few ITO/OTAs but they know our product well. In the asiarooms listings the prices are out of date, the luxury rating is way off, and there is lots of incorrect information.

For a long time I thought it was just content generation for SEO purposes. The brand name is scattered throughout and asiarooms had a fair few google ads placed until I managed to get Google to remove them (a major victory in itself!).

We even had the lawyers involved at one stage but lack of response and international base meant it was getting way too costly. Hence the giving up... but i have renewed hope I may be able to get them removed. Please give me some guidance!

Enjoying the discussion on metasearch sites. We don't use them ourselves - mostly because at the moment we don't really need thema s existing distribution channels are performing well.


Anonymous said...

How are meta sites different from other paid search channels like Google?
Shouldn't they produce better quality traffic at a better price? And do your paid search visitors really stay loyal to your brand or are they loyal to Google and Yahoo?
Finally why chose to stay with wego (Asia focused meta) while ditching bigger sites like hotelscombined and kayak (you don't seem to do branding in the US)?

Anonymous said...

Reply to latest Anonymous post

We choose to work with selective meta search partners as they each have their own markets. We work with Wego for Asia and Kayak for US. You mention hotelscombined in the same breath as Kayak, yet I have never heard of them. I am presuming that you must work for Hotelscombined as I would not call them a large meta search company

Anonymous said...

Since reading this blog post, I have done a Google search on Hotelscombined as I had never heard of them in the US. The guys have done a great job on SEO by exploiting a loop hole in Google's local business directory. They have listed "fake" hotel names or business addresses with the term "cheap" and associate it to a physical address in a city. Its actually damn smart as they are generally the first site featured on Googles Local Business Maps. This is the article which I found which identified the loop hole http://www.imediaconnection.com/content/22451.asp

You have to take your hats off to these guys - as its pretty smart.

John Fearon said...

Seems like the comments about Meta Search have stirred up some debate.

I know Tim is getting an article ready about this and it will be interesting to hear his views.

Justina said...
This comment has been removed by the author.
Justina said...

Hi John,

This comment may come as a surprise and I feel bad acquainting myself with you on such negative terms, but I'm desperate. I went to great lengths to search online for somebody at AsiaRooms who would bother to listen and since you are the Head of Marketing for the Pattaya-based AsiaRooms, I really hope you can and will take the time. I'm a journalist, so pardon me if my "comment" is a tad lengthy.

I would like to find out who I can speak to regarding some issues I'm facing for a Phuket hotel booking I made through AsiaRooms today.

The website was confusing as there were different prices for "instant confirmation" bookings and "on request" bookings, some more expensive and some less. Naturally, as the price for the "instant confirmation" booking for the particular room type I wanted was cheaper than the "on request" package, I chose the "instant confirmation" deal.

However, upon receiving the confirmation voucher, I noticed that there was a term "no boardbase included", so via the support tab on AsiaRooms, I enquired about this term and to my disappointment, I learnt that it meant "no breakfast included". I explained to the online agent that "boardbase" has never been used on any other hotel website or hotel booking website to refer to a meal; I've googled the term and searched dictionaries for this term, but there is no such term.

Since the details had been unclear, I asked whether it was possible to upgrade to the "on request" package, as I want breakfast to be included, but the online agent said it wasn't possible. I requested that the agent refer me to somebody who could help me with this matter and he/she started to take on the tone of "it's too bad but you've already booked through us, so there's nothing we can do unless you want to cancel at a USD$20 fee". This is the link to our conversation for your perusal - http://www.asiarooms.com/enquiry3.php?postID=1874375&reserID=40976661&email=justinatsw@gmail.com

It seems that things aren't done very aboveboard at AsiaRooms and I would like to request that my booking be cancelled at no extra charge. I'm really uncomfortable that the entire operation seems dubious and that there have been so many complaints and negative feedback in forums.

I hate to trouble you since you probably have more important matters to tend to, but nobody seems to be willing to help. I'm really upset that the AsiaRooms website had been so misleading and that the customer service was so blase and unwilling to help. The entire experience left a bitter aftertaste. I hope you'll be able to assist me because I won't let this matter rest until it has been appropriately resolved.

Thank you and I look forward to your reply at the soonest.

Warmest regards,
Email: justinatsw@gmail.com

Thomson and French International ltd said...


Intersting thread. If AsiaRooms is another animal in 2009... and they are addressing the customer service and transparency issues... we would be interested in having them as a supplier... b2b2c


We are a niche market tour operator and moving online. We see the possibility to market 3rd party content and are looking for a new white label accomodation provider. In fact, we are looking at other products as well as we now feature a number of websites.

Love to hear from someone on this.

Marketing & Productivity