Google to sunset CPA bidding on GHA

Starting April 30, 2024, Google has decided to shut down its cost-per-acquisition (CPA) models of bidding — commissions-per-stay & commissions-per-booking on Google Hotel Ads (GHA). While cost-per-click (CPC) campaigns and organic campaigns will continue as usual, only active CPA campaigns on GHA will continue to serve until October 31, 2024.
 

Timeline

April 30, 2024: Commissions-per-stay and commissions-per-conversion will not be available for new GHA campaigns.
October 31, 2024: Ongoing CPA campaigns on GHA will become inactive.
 

Why is this happening?

During the pandemic in 2020, travel cancellations were on the rise. In that period of economic uncertainty, Google stepped in and launched the commissions-per-stay program to “help Hotel ads partners minimize risk while driving future bookings in a responsible manner”. This allowed hotels to only pay a commission for their GHA after the guest stay was completed. Therefore, compared to CPC, CPA are low-risk strategies that require no upfront investment.

Now, nearly four years later, Google has decided to pull the plug on its CPA-bidding models. The Alphabet-Inc-owned company aims to align its meta-search product with other advertising channels that never worked on commission models, like paid search and display.

Google has also been updating its metasearch algorithm and aims to phase out third-party cookies by the end of 2024. This is part of its larger Privacy Sandbox strategy to protect the privacy of users. GHA’s CPA involved commission-based strategies that were heavily dependent on third-party cookies. This is also one of the reasons that CPA is being phased out.
 

What’s next for hotels?

We believe this is a great opportunity for hotels to start CPA campaigns before April 30, and make the most out of it for the next six months.

However, here are some options after October 31, 2024:
Switch to CPC bidding: Hotels can reclaim control over their ad spend by switching over to manual bidding. They will need to spend upfront and also bear the risk of cancellations.
Continue with only organic GHA campaigns: Hotels can leverage Google’s Free Booking Links ensuring you still have some online visibility on GHA.

At Simplotel, we’ve also activated organic GHA listings for all our customers free of cost. This will boost your hotel's online visibility on GHA as your website's rates now get displayed along with those listed on online travel agencies.