How Google’s new hotel bidding works

The shift to prepayment is significant, but it's also an opportunity to optimize your marketing and leverage guest data for better results

As of February 20, 2025, Google officially ended commission-based bidding for hotel ads, changing how hoteliers pay for ads that generate bookings. Previously, hotels only paid a commission when a booking was completed through a Google ad. Now, they must pay upfront for clicks and impressions, regardless of whether those clicks lead to bookings. This shift requires hotels to be more strategic with their ad spending and prioritize first-party data and direct bookings to maintain profitability. Jenna Decker, Solution Architect at Mews, shares insights on how hotels can navigate this transition effectively.

Key takeaways

• Commission-based bidding is gone: Previously, hotels paid Google a commission only when a booking was completed. This low-risk model helped maintain predictable costs and cash flow;
• New model requires upfront payment: Hotels now pay per click (CPC) or based on a revenue target (tROAS), increasing financial risk since costs accrue before revenue is secured;
• Why Google made the change: Stricter privacy laws and the decline of third-party cookies led Google to prioritize first-party data over third-party tracking;
• Leverage first-party data: Collect and analyze guest data directly to personalize experiences and refine marketing strategies;
• Prioritize direct bookings: Invest in a seamless booking engine to reduce reliance on OTAs and increase revenue retention;
• Optimize ad campaigns: Be more data-driven and strategic to ensure a positive return on ad spend.

Get the full story at Mews