Global Distribution Systems, or GDSs, changed the way travel was booked all the way back in 1970. GDS is an online system that delivers inventory, rates, discounts, rooms, descriptions and more to travel agents and other businesses.
Even though many believe GDSs are antiquated and out-of-touch, they still represent a large percentage of bookings. You should evaluate a GDS as you would any other marketing channel. If your property fits with the channel, you should list it. GDSs are used by travel agencies and corporate travel bookers to find their clients accommodations. So, likely candidates for a GDS include vacation hotspots and properties that attract business travelers.
A Quick History
At the dawn of the Internet, early companies like SABRE (owned by American Airlines) and Apollo (owned by United) installed their systems in travel agencies. The systems allowed agents to purchase flights for customers over a system similar to modern day online travel agencies (OTAs). This helped travel agents book travel for clients and likely helped turn travel into the modern day billion-dollar yearly industry that it is.
Today, GDSs are still big businesses, but not as prosperous as they once were. Although they have become somewhat antiquated due to OTAs’ enormous growth, many travel agents still use them to foster relationships and book travel. Originally, GDSs were used primarily by travel agents, but today it is also common for corporate bookers to use the system. GDSs are unavailable to the general public and only authorized users who are properly licensed may register.
GDSs are complicated. GDSs allow companies such as travel agencies and corporate bookers to book travel on the behalf of others. But, GDSs also have the power to send their inventory to OTAs. So, it is possible to list a room on a GDS and to sell it on a site like Expedia.
There are currently four major GDSs that dominate the space including:
- Travelport (Galileo, Worldspan)
The latest data we could find about the state of GDS was from year-end 2014. Their revenues are reflected below:
- SABRE: $2.631B
- Travelport: $2.148B
- Amadeus: $3.834B
Data via Tnooz
As you can see, their revenues are still enormous. But, it’s also important to note that these are total revenues. Therefore, they include airlines, tours, etc. along with hotel reservations. Also, these three companies offer other products and services. For example, nearly 90% of Amadeus’ revenues come from air travel bookings.
In Q1 2015, GDS still accounted for 15.4% of all hotel bookings according to Travelclick. And as you can see in the table below, GDSs still hold their own when it comes to shares in the market. It is undetermined what percentage of attributed GDS bookings were actually sold on OTAs. But, anyone familiar with the travel industry’s various booking channels knows that it is extremely complex. What is important to note here, is that GDSs still hold a significant percentage in the lineup.
Connecting to a GDS
If you decide you want to connect to one of the large GDSs, you have many options. You can connect to one of the four large systems individually or connect to a system that connects to all four of the GDSs. Connecting to each GDS individually can be an expensive endeavor as each charges a hefty set-up fee and other fees. Also, setting up multiple GDSs is complicated, leaving you many different systems to manage. Cloudbeds offers a relatively simple solution.
Myallocator, Cloudbeds’ channel manager, connects to Reconline which offers GDS hotel distribution. Their connection makes your hotel available to over 450,000 travel agents worldwide for leisure or corporate travel.
Using myallocator, you can connect your property through Reconline to Sabre, Amadeus, Travelport (Galileo, Worldspan) and Axess (Japan). Reconline offers an online platform that lets you fully control your account, including availability, pricing, descriptions, etc. They will make sure your company rate agreements are set up correctly and ready to go before you begin. Travel agent commissions are also set by you, but know that they recommend 10%. They also handle commission delivery for you. There team of experts will help you present your property for success.
After you set up your Reconline profile you can go into myallocator and set up your account. Once you enable a connection between Reconline and myallocator, all of your availability will seamlessly remain up-to-date.
If you’re not already a myallocator customer, request a demo and our sales team can explain the many benefits to your property.