Ryanair continues its transformation from the company you love to hate, with its charm offensive, targeting business travellers and now expanding into new product areas.
This is an interesting move that must be good news for the hotels sector.
On one hand you might think that hotels have spent the last 5-10 years fighting the OTAs for control of the guest and market share, why would they want another OTA to enter the market?
But OTAs are not themselves bad for hotels, it has been their oligopolistic power that has been bad for hotel companies with high commissions, a stranglehold on online (and traditional media) advertising and technical superiority, that has left hotel companies struggling to compete for online sales of their products.
Therefore a new entrant charging lower commissions (apparently around 10% for Ryanair Rooms) will be good for hotels in increasing competition amongst OTAs and driving down commission rates.
It is interesting as well that Ryanair Rooms is looking to bridge the gap between AirBnB, with its lower commissions, but focus on homestays and BnBs and the traditional OTAs with higher commissions more focused on hotels.
However, Ryanair Rooms will be exploiting its existing cost-conscious client base, so I see this as being more an infringement into AirBnB's territory than someone like Expedia and I don't think onefinestay, with its luxury client base, will be too concerned about losing clients to Ryanair.
Budget airline Ryanair will launch an accommodation service, offering customers a choice of hotels, hostels and more at the lowest prices. The low price accommodation service, Ryanair Rooms, will launch from 1 October, in a bid to expand its offering to its 116m customers in a challenge to the likes of Airbnb. The service will offer hotels, hotels, B&Bs, holiday villas and homestay options, but pledges that whatever is chosen is always at the lowest prices. “With “Ryanair Rooms”, we’re going to transform booking accommodation. Launching on 1st October, “Ryanair Rooms” will offer consumers the biggest range of accommodation, including hotels, hostels, B&Bs, homestays and villas, via the Ryanair.com website, but all with the same lowest prices we guarantee with our flights,” said Ryanair’s Kenny Jacobs.