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Preliminary findings from Hotel Distribution Channel Analysis
June 6 2011

Preliminary findings from the AH&LA and STR special report titled, "Hotel Distribution Channel Analysis", published by HSMAI, were presented at the NYU International Hospitality Industry Investment Conference.

NEW YORK, NY (June 6, 2011) – Preliminary findings from the American Hotel & Lodging Association (AH&LA) and STR Special Report, titled “Hotel Distribution Channel Analysis”, published by the Hospitality Sales & Marketing Association International (HSMAI) Foundation, were presented today at the NYU International Hospitality Industry Investment Conference in New York.

The full report, authored by Mark Lomanno, CEO, STR, and Cindy Estis Green, managing partner, The Estis Group, is scheduled to be released in September. It is the most ambitious examination made to date of the hotel industry's use of distribution channels in order to develop tools and metrics to assist hotels in determining their optimal channel mix.

“Prior to this study, much of what we knew on this topic was simply anecdotal,” said AH&LA President/CEO Joe McInerney.  “A complete analysis of the costs and benefits of the various hotel distribution channels is absolutely essential so that hoteliers understand the value of each entity to their business.”

The study findings illuminate many aspects of distribution analysis including an explanation of the impact of each channel on hotel demand and revenue, with a more granular examination of channel performance by metro area. It explores economic factors such as elasticity of demand by chain scale as well as consumer shopping patterns relative to channel selection.

“Average daily rates realized by individual hotels vary widely depending on the distribution channel,” said Lomanno. “Without a comprehensive understanding of the costs associated with the respective channels, the industry is leaving money on the table. This study, upon completion, will help the industry understand the costs and benefits of the respective primary distribution channels.”

Additional elements of the study and report include:

• Economic modeling of demand patterns at the national and local level
• Direct and indirect cost analysis by channel
• Consumer behavior relative to online shopping and buying
• The relative costs of various marketing channels including search engines
• Ancillary spend and retention patterns
• Advertising and promotional spending within hospitality
• Examination of the practical application and consistency of use of rate parity
• Review of current techniques in use at the unit level for pricing, inventory management and transient revenue generation

“Given the crucial strategic role of distribution and its implications for profitability, this is a discipline that is fast becoming the centerpiece of many hotel companies' marketing and revenue management plans,” said Estis Green. “Understanding the dynamic will be essential to successful hotel operations over the next decade.”

Findings from the study, conducted by STR, The Estis Group and Oxford Economics, will also be presented at upcoming industry events, including the AH&LA board meeting, HITEC and HSMAI’s Revenue Optimization Conference.

“The results of this balanced analysis of hotel distribution channels will add significantly to the body of knowledge available to industry sales, marketing, and revenue management professionals, building on reports previously published by the HSMAI Foundation, including Demystifying Distribution and The Evolving Dynamics of Revenue Management,” said HSMAI Foundation Executive Director Fran Brasseux.

Media Contact:

Kathryn Potter, senior vice president of marketing & communications, AH&LA, 202-289-3130,

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