Small Hoteliers and Family-Run Hotels: Dependency on OTAs

When it comes to a hotel-related discussion, there is nothing more globally talked about than that topic of online travel agents (OTAs). Hoteliers have considered how OTAs can affect their marketing campaigns. Since an OTA acts as an intermediary between guests and hotels, hoteliers can be either benefit from them or lose to them. They can fall into an ally-competitor relationship.

Recognize Advantages

The biggest advantage of employing OTAs is that they provide a marketing boost of exposure to small hotels that are unpopular and do not have a great visibility. Since there are a lot of competitors in this in this industry, getting noticed by the guests is not an easy task. OTAs act as third party partners that promote various hotels. If there are many visitors on their website, there is a higher chance that your hotel would get a booking.

Note the Disadvantages

While it’s true that OTAs can give benefits to your hotel, its drawbacks can also bring harmful effects. Online travel agents receive their payment through commissions. Hoteliers regard this as a major concern. Since these commissions are based on a high percentage ranging from 15% to 30%, OTAs can prove to be a heavy burden on your profit margin.

The biggest threat that an OTA can bring to your hotel marketing strategies is the possibility of losing your loyal guests. Customers’ loyalty holds a great value on hotels. Since these people are already sure re-purchasers, losing them would impose a great risk. OTAs are now embarking on the growing trend of implementing loyalty programs. This was once a unique selling distinction of hotels to OTAs. Loyalty programs were offered only by hotels, rewarding their guest with points for any bookings at their hotel. Now, some OTAs are implementing the same strategy. They reward guests for any booking transaction.

The insistence of OTAs to have the rate parity and the best price guarantee philosophy is also another limitation raised. When hotels partner to OTAs, they have to accept an agreement of paralleling their prices or conforming to rate parity. This would mean that whatever the price you offered in your own website should be in line with the price seen in the OTAs. This creates a limitation to hotels in setting up their own websites to be likely more appealing and be favored for bookings.

Identify The Potentials of Your Official Website

Many small or new hotels and family-run hotels rely on the use of OTAs. This is because they may not have the necessary resources for them to avail expensive booking engines or hotel CMS. Basically, they pay high commissions to bookings generated by third party agents that would later result in the departure of traffic from the hotel's official website.

A number of small hotels have overlooked the potentials and benefits of their official website. Using their own website, they can cross-sale additional services and products from their hotel that will boost more of their revenue. This will be possible if they choose to accept their own website’s capabilities on bookings and consider them as a good promotional tool.

Optimize Your Own Website and Promote Direct Bookings

The most important function of your website would be to drive traffic and increase conversion rate. That is why it is essential to optimize your official website to encourage direct bookings. Your webpage has to be updated from time to time.

Studies show that guests mostly compare hotel presentations and offers before making their final decision. If you are not partnered with OTA and offer better prices, you have an advantage. There are still some factors that can set your website competitive enough with OTAs. These include the preciseness of payment security, time needed for booking, property offers and descriptions, availability of promotions, and the user-friendliness of the hotel’s website.

The Need for a Hotel Booking Engine

Small and family-run hotels have small budgets to manage their website. Here at TravelSolutions, we understand the need of hoteliers. That is why we provide solutions for your website and offer an efficient hotel booking engine for your business at an affordable price. Small budget hotels will not worry about revenue loss anymore. Get direct bookings and enhance your website’s conversion rates from our help.

To begin, you can ask for a free quote and TravelSolutions will contact you with an offer.