In the dynamic landscape of the hospitality industry, generating direct bookings has become a top priority for hotel owners. As a hotel management company, we understand the challenges they face in developing effective hotel marketing strategies and an effective hotel business plan to drive bookings through their own portals.
Balancing direct room sales with third-party websites and online travel agents (OTA’s) is one of the challenges the hotel industry faces in 2023 and beyond. While the ideal scenario is to handle everything independently, relying solely on your own revenue management and hotel marketing strategy may not be sufficient. Making reservations at hotels via online travel agencies has become insanely popular nowadays. Unfortunately over the last years, consumers have developed a behavior they don’t even consider booking on a hotel’s website. Many have become loyal to the OTA, thinking they offer better rates than on the hotel’s own brand.com website.
So how could hoteliers not want (or have) to cooperate with the OTA’s?
But then there is the other side… Do we really want that ‘help’? Do we want to pay high OTA commissions or give steep wholesaler discounts, and slowly but surely slide into a position of being (overly) dependent on the conditions the OTA’s dictate us (yes they try to!)?
With the elevated fees hotels have to pay to 3rd party websites for selling their OWN rooms, they are left with substantially reduced profit margins.
However… There is hope!
The winds have been changing lately and the ‘trend’ is shifting back to diverting the business from OTA’s directly to the own hotel website with the aim to win direct clients.
Travelers are becoming more aware (also thanks to the ‘buzz’ created by the marketing efforts of the large hotel chains) that direct bookings can offer considerable advantages. Travelers start searching for lower room rates and discounts that are not always available through the OTA’s. The game of driving the bookings away from the OTA’s by converting more on your website has started.
Hilton launched a program called ‘Stop Clicking Around’. IHG calls it ‘Your Rate by IHG Rewards’ and claims to have increased their digital revenues by 7% and mobile revenues by 32% as a result. Marriott, Starwood, Choice, and Best Western have also entered the war against the OTA with the best rate, or rather better rate, guarantee program for their loyal members.
They are fighting to take what’s theirs … Are you on the ball with this at your hotel?
It’s time to wake up and to react now using the momentum to your advantage!
In this article, you will find some insights which let you reflect on this subject and some ideas you could incorporate into your sales and marketing strategies.
Published by Samuel Itodo – Hospitality Business Consultant