Amazon.com (NASDAQ:AMZN) wants to own the world. Er, I mean, Amazon wants you to see the world. And to help you do that, the company quietly launched Amazon Destinations earlier this week to help travelers book hotel rooms right from its website.
I know what some of you are thinking: Didn't Amazon already have this? Yes it did, sort of.
Amazon used to have up to 100 deals for deeply discounted hotel rooms on its site each day, but no more. Instead, Amazon is now trying to target local travelers looking for short getaways by offering hand-picked hotels by Amazon -- with a few good deals mixed in with the regular-priced options.
Right now, Amazon Destinations allows users to select three major areas in the U.S. to book hotels in: the Pacific Northwest, the Northeast, and Southern California (if they aren't technically local to you, that's still OK).
An Amazon spokesman speaking to The Wall Street Journal said, "These are all hand-picked properties that have been visited by someone at Amazon to make sure they meet our quality."
Amazon's offering up these curated hotel -- and bed and breakfasts -- rooms through Destinations that are aimed at getting users to sign up for local (or not so local) getaways.
So, what's in it for Amazon?
The company's looking to carve out a niche hotel booking site in the $163 billion a year U.S. hotel industry. And Amazon's in a unique position to do so. The company already knows a lot about what its customers purchase, how much of it they buy, when they buy it, and what they search for. That's valuable data to have when deciding what types of hotel locations to offer and for how much. Imagine adding hiking boots to your Amazon shopping cart and the website serves up a suggestion for a $89 per night cabin to break those boots in.
Aside from Amazon's ability to know what it's customers want, the company also has one of the most trusted brands -- which comes in handy when hand-selecting hotels for customers. Despite a small drop in overall customers satisfaction last year, Amazon still ranks No.1 in the American Consumer Satisfaction Index (or ACSI) survey for online retailers.
If Amazon can successfully combine its customer knowledge with its strong brand satisfaction it may be able to lure a few travelers away from traditional booking websites like Priceline and Expedia. But it won't be easy.
In a press release, ACSI director David VanAmburg said, "The big advantage that the major Internet travel sites have over the competition is their comprehensiveness and global reach." With just three U.S. regions to choose from, Amazon Destinations is smartly sticking with just a few select regions right now and marketing its service for local getaways. This keeps Amazon from competing too much with the discount hotel websites, like it did with its failed hotel deals offerings in the past.
Remember that unlike the major booking websites, Amazon's hand-selecting its hotels now. While the company may not be able to offer the same amount of options as the larger hotel booking sites, the preselected locations may be the ideal choice for customers who already trust Amazon's stellar brand.
Chris Neiger has no position in any stocks mentioned. The Motley Fool recommends Amazon.com and Priceline Group. The Motley Fool owns shares of Amazon.com and Priceline Group. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.