Online Travel Agencies (OTAs) such as Expedia, Agoda or Booking.com have become a crucial source of hotel revenue. Independent hotels are particularly dependent on OTAs for their revenue. While this is not necessarily a negative trend, hoteliers should avoid relying too much on this channel for it may hurt the hotels’ profitability. OTAs usually demand around 10-20% in direct commissions. Additionally, the rate parity agreement with OTAs limits the hotels’ pricing options.
Hotels, therefore, should work hard to boost direct bookings from their own websites and reduce the cost of acquisition. You as an hotelier can follow these best practices from experts in the field of hotel management to drive your direct revenue.
1. Pay attention to the review sections
Travellers often read online reviews before choosing their properties. Constantly monitor the review sections on the OTAs’ sites as well as review websites such as Yelp and TripAdvisor. You should try to respond to as many reviews as possible, and as soon as possible, regardless whether they are positive or negative.
2. Utilise OTAs to drive direct bookings
You should consider OTAs much more than booking engines in your marketing strategy. A large number of travellers use OTAs as a tool to do research and plan their trips. 52% of them will eventually visit your website after seeing your hotel on an OTA, according to Google. Therefore, you need to make sure the information on your website and on the OTAs are consistent.
Follow the next practices to ensure that once they land on your website, they will stay and book instead of going back to the OTAs’ sites.
3. Make the booking process easy
Ensure that your booking engine is easy-to-use and accepts a wide variety of payment methods. You can use the OTAs’ booking processes as a benchmark. Pay attention to your call-to-action i.e. the “Book Now” button. Make sure that it is clearly visible and placed in a prominent position on every page of your website. Make sure your website is friendly to mobile devices as mobile web access will soon exceed access via desktops.
4. Offer the same rates on your website as you do on OTAs
Getting the customers to visit your website would mean little if they are not provided with the best deals. Many hotels, surprisingly, still offer cheaper rates on OTAs than on their own websites. Most travellers are price-sensitive and would not book through your website if the rates are not comparable with the rates on OTAs. So ensure that the offered rates are identical across channels. You could also throw in some extra perks such as free breakfast, Wi-Fi or tickets to sweeten your direct offers without violating the rate parity agreement.
5. Incentivise repeat direct bookings
It is always more costly to acquire a new customer than it is to keep an existing one. Implement a loyalty program to secure repeat direct bookings. This should apply to not only your direct guests but also those who booked via OTAs. For instance, you can send them emails offering discounts if they book directly next time.
Boosting direct bookings is an effective strategy to drive your Hotel revenue. If you want to know more about how to improve profitability, please refer to our 3-part article “9 ways to increase Hotel Profits” or download the full white paper from the link below.
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