Question: When does the broadening of a major travel supplier’s travel distribution channel result in less revenue opportunities for travel affiliates?  Answer: When the new channel pays affiliates less than the supplier’s existing affiliate program!  This seems to be the case with LeisureLink’s new distribution deal with Priceline when compared to their existing program with travel affiliates.

LeisureLink, the leading distribution and revenue management platform for specialty lodging suppliers like condos, timeshare, vacation properties and boutique hotels signed a distribution deal with Priceline.com today.  Although terms of the partnership were not publicly disclosed, Priceline – and the thousands of travel affiliates enrolled in its affiliate program – now have access to the more than 1,400 North American and European vacation rentals, independent resorts, timeshare and condo hotels in LeisureLink’s inventory.

However, based on TravelDividends’ assessment, although travel affiliates can now sell LeisureLink’s products through Priceline, they are better off financially by working directly with LeisureLink.  Here’s why:

  • Priceline pays its travel affiliates 3% commission on the total value of most hotels stays that the affiliate’s customers book through any of Priceline Inc’s various websites (e.g., priceline.com, booking.com, agoda.com, travelweb.com, lowestfare.com); we assume this commission level applies to the inventory now available from LeisureLink
  • If, however, a travel affiliate funnels the same customer to the same property via LeisureLink’s reservation site, ABetterStay.com, the travel affiliate receives 10% for the booking

Don’t get us wrong – we like Priceline, and we think it has one of the better OTA travel affiliate programs, but when there is more than a 3X difference in affiliate compensation between two vendors offering essentially the same program, the math makes it pretty easy to determine which program travel affiliates should work with.

Priceline is smart in linking to LeisureLink/ABetterStay – and travel affiliates would be wise in following suit.  In many instances, vacation home rentals provide consumers with a superior value to traditional hotel / resort accommodations.  If you, as a travel affiliate aren’t offering this type of vacation option to your customers, you should reconsider your position.  By working with LeisureLink/ABetterStay, you’d gain direct access to the largest online network of vacation rentals in the world.  This in turn would enable you to tap into two huge – and growing – lodging niches: timeshare resorts and vacation home rentals.

According to Ernst & Young LLP, as of January 2007, there were about 1,615 timeshare resorts in the U.S., representing a market size of approximately $10.6 billion.  Travel market research firm PhoCusWright (PCW) pegs the 2007 U.S. vacation home rental market at nearly $24.3 billion in rental revenue and more than 333 million available unit nights.  Additionally, PCW suggest that the online vacation home rental market is a fast-growing super travel niche, expecting U.S. related sales to reach nearly $4.7 billion in 2010, up from $2.8 billion in 2007.

LeisureLink reinforces TravelDividends’ long-standing belief that travel niches represent the best opportunities for travel affiliates to earn serious money in the travel industry.  We’d like to hear from our travel affiliate readers whether their experiences in travel niches – and in particular, the time share/home rental vacation niches – mirrors our sentiments.  Drop us an email and let us know!

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