Are OTAs ruling your world? Do you feel that as an independent hotel or small chain, you don’t know who to trust or partner with, to drive more bookings?
If you are in that position, these 8 steps will help you regain control over your hotel Online Travel Agency strategy.
1 – Review and understand why OTAs are so dominant
Many of us know this, but we hate to admit it.
OTAs have a humongous reach. And they are willing to invest a lot of money, development and efforts to make it even bigger.
Essentially this means access to a pretty unlimited online audience worldwide.
It is a very practical way for travellers to research. And they can find what is available at the destination through an OTA in a way that hotels cannot easily match.
A hotel marketing team can only fantasise about the latest technology, research & testing and manpower that OTAs throw into acquiring customers.
OTAs take a dynamic approach in understanding customer buying patterns in developing economies and adapt accordingly.
Knowing this and acknowledging this helps us plan our hotel Online Travel Agency strategy better.
2 – Try not to ask if it’s possible to find a balance between OTA channels and direct bookings
We all agree that direct bookings are cost-effective in the long run. However is it possible to find the right balance? In a weird way, this reminds me of the work-life balance question. There is just no one way to do it.
With all the noise about OTAs, it is easy to be misguided when analysing the impact of OTAs and hotel Online Travel Agency strategy.
Each distribution channel has a cost attached to it. In an increasingly converging world, it is hard to measure things in silos.
The key to finding a balance is diversification and a clear understanding of distribution costs by channel.
3 – Dwell into facts rather than emotions when you see the commission invoice!
Have you compared conversion rates on your hotel website with the OTA website which delivers most bookings?
Mostly hotels compare OTA commission costs of 15% and over with a low/non-existant cost of a direct booking. Is this really true? Are all the marketing and external costs being taken into consideration?
And does your hotel have the resources to have a dedicated professional, working to increase direct bookings? Do you have a clear hotel Online Travel Agency strategy?
4 – Find out the true cost of OTAs as part of your hotel Online Travel Agency strategy
With the overlap of bookings and referrals from multiple sources, it may be a difficult path to take.
However, if OTAs form an important part of your distribution strategy, do find out the true costs of doing business with them.
These two articles provide some excellent insights on how to factor costs of OTA bookings into your hotel Online Travel Agency strategy.
5 – Learn technology & marketing innovations from OTAs
With web technology becoming increasingly accessible, not only do you have more choices to learn from OTA technology innovations, but also find ways to apply them too.
What are retargeted ads? By now, you are pretty used to seeing the destination that you just researched on google appearing when you are on your facebook page. It just means you have been retargeted. Find out more here.
One of the prime reasons cited for losing customers from the brand website is booker behaviour. And the belief that OTAs can get them better prices. So over and above your best rate guarantee, is there a way to convince prospects that the hotel site does offer the best rates?
6 – Be less obsessed with rankings.
Rankings are a much guarded secret. What is known is that
- Hotels which offer good value and therefore get booked more get to the top
- Hotels that get good reviews and therefore get booked more get to the top
- Hotels which offer a higher commission will benefit
- Hotels that offer good availability throughout the year will benefit
Rankings matter, but an organic approach considering the above factors is often the best way to get ranked high.
Should rankings be considered as part of your hotel Online Travel Agency strategy? Yes, but within reason.
7 – Filter and choose OTAs to work with for your hotel Online Travel Agency strategy
Look at historical data to understand which OTAs have delivered. Then review if the guests from those OTAs were the right type of guests for your hotel. If they were the right clientele, then they pass the test. So do more with those OTAs.
Gather information from OTA guests on why they chose to book through that OTA. Use this information to maximise bookings from that OTA and/or to get guests to book direct.
When considering a new OTA, analyse if this OTA can reach markets that you cannot reach easily. Also study the other type of hotels being sold by that OTA in your destination to ensure that there is a fit in terms of style and pricing.
Equally important are the costs. How does it compare to existing OTA costs?
Here is a comprehensive list of OTAs that could help with building your hotel Online Travel Agency strategy.
8 – Actions to take with OTAs for best results
- Avoid too much dependency on one or two OTAs. Diversify the OTA base and ensure visibility on a range of channels
- Also identify niche websites that work for your target market
- Respond to OTA reviews regularly and approach them the same way as you do to Trip Advisor reviews
- Ensure photos are of the highest quality and are current
- Improve property descriptions to help travellers understand its location in relation to key areas of interest
- Spend time on room descriptions to ensure bookers understand the differences and benefits of each room type
- Develop a relationship with the OTA market managers and attend their events where possible. They can help you gather information about the best practices of your competition, future events and promotions that work
- Managing inventory pro-actively and using varied booking conditions can be effective even for small properties. Analyse the type of demand from a specific OTA and manage this process
- Ensure overall rate parity.
Collaboration (with OTAs and other niche agencies), innovation (with product development, pricing and packaging) and adaptability (being ready to absorb and deploy new technologies) are fundamental to your OTA success strategy.
Which OTAs work for your hotel the best and why? Join the conversation!
Article inspiration & references: