A One-Stop Site for Hotel Rooms?

Hotels.com makes a big promise that isn't always kept. While it's a must-visit for travelers, other stops should be made, too

By Gary Gately

For the traveler in search of the elusive one-stop shop for hotel bargains, the promise seems irresistible: "The best prices at the best places. Guaranteed." The newly renamed Hotels.com makes this promise with great fanfare on its Web site, in TV and newspaper ads, on the gigantic electronic billboard in Times Square, and on taxis in New York.

But can you really skip the surfing and calls to hotels, forget the travel agents, and rely on this one site to get the best hotel rates? Sorry. Hotels.com had the best prices sometimes, but not always. A few minutes worth of clicking around the Web can yeild better deals.

Hotel.com's range of places to stay includes both "the best" and places that are well short of it. Some visitors will find that its one- to five-star rating system, while clearly explained, is marred by more than a touch of grade inflation. And it wasn't especially easier (or harder) to use than competing sites like Expedia, Travelocity, Lodging.com, or the hotel industry-backed site Travelweb.


  I tested the guarantee first by checking out a couple of trips to New York. I found two hotels that were both cheaper on Expedia. At The Gorham in midtown Manhattan, a European-style boutique hotel I've enjoyed before, a search for a standard room for two for the same two nights in June demonstrates just how much a bit of shopping can save. Hotels.com priced the Gorham room at $339.95 a night to Expedia's $285.

Hotels.com also came up short when I searched for a lower-cost New York hotel for a weeknight stay, delivering a standard room at the Paramount for $189.95, compared with Expedia's $169. Hotels.com lost other head-to-head price comparisons to Expedia on searches for Las Vegas, San Francisco, and Chicago.

This isn't to say Hotels.com doesn't offer bargains. You can find plenty on the site -- like the Hyatt Chicago from $85.95 a night (Expedia, for a June weekend night, offered $99 at the lowest) or the Marriott New Orleans in the French Quarter, from $99.95 (Expedia said $179). Certainly, Hotels.com site should be included in any search for hotel bargains, but it shouldn't be the only site you use. On the Web, like everywhere else, comparison shopping pays.


  Most veterans of online hotel booking know the outfit behind hotels.com. The Dallas-based company formerly operated under the name Hotel Reservations Network Inc. and began Web-based booking in 1996 at hoteldiscounts.com. HRN bought the Web address hotels.com (as well as hotel.com) from a startup, changed its corporate name to Hotels.com (ROOM ) this spring, and launched a high-profile advertising blitz touting its newly redesigned site.

The ads feature CEO David Litman and President Bob Diener in TV ads haggling over the price of hotdogs at a ballgame. The point is to convince you that they're compulsive bargain-hunters -- on your behalf as well as their own.

Hotels.com contracts with more than 6,000 properties for volume purchases, then sells rooms to customers, making it one of the biggest online hotel-booking sites. It reported sales of more than $536 million last year. Even with the post-September 11 drop-off in travel and a shaky dot-com economy, Hotel.com's revenues have increased, reaching $165.7 million for the quarter ending Mar. 31, while its stock has climbed from $38.38 a share on May 1, 2001, to around $51 now.


  By completing a relatively painless (and free) registration, you can set preferences like whether you want a budget or a five-star room; major chains, boutique, or all-suite hotels; pet-friendly or business-oriented hotels. You can also list preferred nearby diversions from recreation to museums to gambling, and search hotels by name, price, rating, proximity to attractions, and amenities like pools or exercise rooms. And the descriptions and photos provide enough detail to help you decide whether you'd want to stay at a hotel.

But again, it's important to compare, not only prices, but also descriptions and ratings of hotels. Using HRN's hoteldiscounts.com several years ago, I booked a New York hotel that looked O.K. online but turned out to be a dive with sagging mattresses, dim corridors, and ancient bathrooms down the hall. I had arrived late in the evening and called HRN, which switched me a hotel across town.

Even now, some of the ratings Hotels.com awards seem high. A three-star Ramada in Towson, Md.? Maybe, maybe not. In New York, the Hotel Pennsylvania gets two and a half stars, though it's a sub-$100 a night place (at least on Hotels.com) where airline crews, whose employers are notoriously tightfisted, are a staple. Expedia gave both hotels two stars and was probably more accurate in each case. Neither rating system is exactly Michelin-tough: Each gave an airport Holiday Inn Express near Baltimore-Washington International Airport three stars.

So if you're hitting the road on a summer weekend, or any other time, Hotels.com is worth a few minutes, and you'll likely find a bargain. But caveat emptor: Nothing, and certainly not a lowest-price guarantee, is ever quite as simple as it sounds.

Gately covers travel and technology issues from Baltimore

Before it's here, it's on the Bloomberg Terminal.