Google’s Free Booking Links: The Secret Weapon for Hotels in the Battle for Direct Bookings

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There’s no denying the dominance of Google when it comes to search marketing. In October 2022, Google’s market share of search was 91.2%, making it by far the most popular search engine in the world.
For hotels, Google offers numerous opportunities for reaching the hundreds of millions of travellers who search for hotels on Google every day. One option that has been gaining a lot of traction recently is Google Hotel Ads (GHA), a metasearch platform.

Metasearch platforms like Tripadvisor, Kayak, Trivago and Google Hotel Ads display a hotel’s rate offerings pulled from a variety of booking sources on one page. Travellers love them because they can compare rates without having to visit every site. To make a reservation, users click through to their preferred booking source.

To display a direct link on metasearch results pages for a given hotel, the hotel and online travel agencies must bid for placement and pay a fee for every click. If the hotel doesn’t appear, travellers are more likely to click through to an OTA and book there. Metasearch campaigns are therefore an important way for hotels to attract direct bookings and reduce third-party commissions.

Google launched its metasearch module over ten years ago, giving it high visibility by integrating it into Search, Maps, and Business Profiles. Since then, the platform has been carving an increasing market share from other metasearch sites. In 2021, Google upped its game even further by adding Free Booking Links (FBL) as part of the Google Hotel Ads platform. When a hotel creates a GHA campaign and activates this feature, a free link to its website booking engine is displayed alongside paid ads in the metasearch module.

Metasearch platforms are crowded with OTAs, all vying for clicks from travellers. With Free Booking Links, the hotel stands out from the crowd. Although paid ads receive top billing under “Featured options,” the hotel’s free link is displayed directly below as the first listing under “All options” and is labelled as the “Official site.” This draws attention and lends credibility to travellers. If the hotel is running a Google Hotel Ads campaign, a second, paid listing may appear, providing even more visibility.

Even better, when travellers click the free link, the hotel doesn’t pay any fees to Google. Nor does it pay a commission if the traveller proceeds to reserve a room on the hotel’s booking engine. Ergo, the “free” in Free Booking Links.

For hotels, this means additional direct bookings at a significantly lower average cost. And, as every hotelier knows, direct bookings allow hotels to control the booking experience, offer upsell opportunities, and collect valuable information and data directly from guests.

To understand how Free Booking Links affect hotel performance, D-EDGE tracked booking activity for 1,000 hotels across Europe and Asia Pacific from June to September 2022. We then compared the results to the same period in 2019, prior to the pandemic and before Free Booking Links were introduced.

We also compared the results to Google Ads performance. Not to be confused with Google Hotel Ads(GHA), Google Ads are keyword-based ads which appear at the top and bottom of search results.

At D-EDGE, we’ve always recognised the value of Google metasearch, but even we were surprised by the results. Free Booking Links are a game-changer for hotels.

Here are five key takeaways from our findings.

While revenue generated from Google Ads (Ad words) grew by 20% between 2019 and 2022, incredibly hotels experienced an average increase in revenue of 95% from Google metasearch(Google Hotel Ads).

Free Booking Links accounted for an impressive 34% of this revenue, whereas the paid part of Google Hotel Ads accounted for 66%, increasing by 29% over 2019.

In 2022, the average distribution cost for bookings from Google Hotel Ads paid links was 8% of revenue generated, a decrease from 9% in 2019. However, when Free Booking Links are factored in at zero distribution costs, the average distribution cost dropped to 5.2%.

For Google Ads, the average distribution cost in 2022 was 7%, a decrease from 8% in 2019. On both platforms, pay-per-click fees are considerably lower than OTA commissions, which generally start at 15% on Booking.com and 18% on Expedia plus incremental commissions for promotions.

In 2022, the average conversion rate for Google Hotel Ads was 4.10%, an increase from 3.41% in 2019. For Free Booking Links, the average conversion rate was slightly lower at 3.66%. This means that for every 100 users who clicked the free link, an average of almost four of them made a booking.

Given the high volume of traffic Google receives, even a small increment in conversion rates can result in a significant boost in bookings. By comparison, the conversion rate for Google Ads was 1.09%. Metasearch typically generates more conversions because live room rates are displayed, whereas they are not displayed in Google Ads.

For Google Hotel Ads, the average revenue per booking in 2022 was €329, an increase of 19.2% over 2019. Meanwhile, the average revenue per booking from Free Booking Links was €258 — lower but still significant given there were no distribution costs. For Google Ads, the average revenue per booking was virtually the same as GHA at €327.

The lower average value of FBL bookings can be explained in part by the high proportion of mobile bookings, as we see in the next key finding. Travellers tend to book shorter, last-minute stays on mobile devices and longer stays on desktops.

At 68%, the majority of bookings generated by Free Booking Links came from mobile devices, whereas 32% came from desktops. Almost the reverse was true of Google Hotel Ads and Google Ads, where 37% of bookings were made on mobile devices and 63% on desktops.

The difference can be explained in part by the high visibility Google gives to Free Booking Links on smartphones. On desktop searches, FBLs are harder to find and sometimes didn’t appear at all during our testing.

Although overall revenue generated by Google Hotel Ads increased substantially in 2022, it’s clear that Free Booking Links are cannibalising some of Google’s cost-per-click revenue. Which begs the question, why does Google give away these clicks for free?

While Google hasn’t provided an explanation, we suspect it’s part of a “freemium model” strategy — providing a basic product or service free of charge to attract new customers, knowing that some will pay for additional or premium services.

To activate Free Booking Links, hotels must launch and maintain an active Google Hotel Ads campaign. Some hotels set the minimum bid to ensure their ads never show up. Others, however, decide to invest in a paid campaign, putting more revenue into Google’s pockets. And in the future, if Google discontinues free links, hotels will have to run paid GHA campaigns if they wish to continue driving direct bookings on the platform.

Here are a few more things to know to activate your free link.

If you’re not sure if your free link is activated, search your hotel on Google and enter dates when rooms are available under “Check availability” in the metasearch module. If an “Official site” link doesn’t appear under “All options,” it’s probably not activated.
To activate Free Booking Links, hotels must work with a connectivity partner like D-EDGE who will set up a live feed of your rates, availability and content to Google.
Hotels must have a verified Google Business Profile to qualify.
Once you’re set up, you can view performance data in your Hotel Center account — or your integration partner will provide reports for you.
Remember that travelers use metasearch to shop rates. To maximise direct bookings, keep a close eye on pricing to ensure you’re not being undercut by OTAs.

The bottom line? “Metasearch has become an integral part of a diverse distribution strategy for hotels,” says Hadrien Lanne, D-EDGE’s Digital Media Director. “If hotels aren’t participating in metasearch, they’re losing direct bookings to OTAs and paying commissions of 15 to 20%. With Google’s Free Booking Links, hotels now have a way to increase direct bookings at a lower cost. It’s a win-win for hotels.”

If hotels aren’t participating in metasearch, they’re losing direct bookings to OTAs and paying commissions of 15 to 20%. With Google’s Free Booking Links, hotels now have a way to increase direct bookings at a lower cost. It’s a win-win for hotels.

Hadrien Lanne

Digital Media Director

D-EDGE

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