How Your Hotel Could be Losing Revenues to the OTAs

A lot of hotel marketers generally assume that once they have integrated their systems into the global distribution systems, then they are good to go. However, as it has been proven time and again, this is the wrong approach to hotel marketing in the age of the internet. Hotels need to do more than just post their latest rates in various leading online travel agencies (OTAs) by incorporating their own online booking software.

Relying on the OTAs mean losing your margins by surrendering a significant chunk of the revenues to the OTAs through the commissions regime. It is necessary to rethink this strategy and invest in a more robust branded website and website booking engine. There are hotels that have already incorporated online booking software, but they are not using its advantages to the fullest. They may have branded websites which are not highly appealing, are static and are not optimized for the search engines and the user experience.  Some do not even care to promote their own products and services on their websites in spite of the presence of the various tools and features which are provided by the online booking engine vendors. These are tools that they can use to their advantage in order to increase direct bookings on their branded websites and capture 100% of the revenues. Some do not use these tools, but they apply them in the wrong way which results to very low impact and success rates.

These little challenges mean that many of these hotels are going to concentrate their efforts marketing with the OTAs. They use these channels as a means of increasing their visibility and availability to their customers. Many OTAs are also recognizing the advantage they have in the industry and are investing in more robust technologies in order to stay on top of the bookings game and keep the hotels and other travel providers dependent on them.

The situation, however, is not hopeless for the travel providers. One way through which they can increase their competitive advantage is by beginning to think like the OTAs. They can increase their investments in technologies such as online booking software and generate their own revenues without over-reliance on the OTAs. Apart from investing in the booking software, they can also increase their investments in order to increase their rankings and acquire more traffic. Encouraging direct bookings enables these travel providers to save big on those hefty commissions while also cultivating the loyalty of their customers in their brands.

Building your own marketing channel cuts costs but also enables you to be more productive and profitable in the online travel market. It allows the travel and accommodation providers to build a revenue management culture and closely understand the buying behavior of their customers. They can use this data and insight in order to tailor more products that will appeal to them and respond to their needs. They will be able to easily segment their customers and set up the rates and packages which cater for the various market segments. Accommodation providers, for example, will determine the kind of guests that stay at their facilities and create targeted packages which allow them to sell even more products and bring in more revenues.

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