Over the past decade, the hotel industry has experienced dramatic changes, particularly in the area of hotel channel distribution. Big brands, online travel agencies (OTAs), global distribution systems (GDS’s), and metasearch websites are all vying for customer attention, and it’s all affecting hotel margins.
In order for hotels to navigate this shifting distribution paradigm, and optimize their channel mix, they must take an in-depth look at the costs and benefits of their channels: direct, indirect, online, and offline. By analyzing these channels, hotels can develop a holistic strategy that creates revenue and profit streams that are sustainable going forward.
It Starts with the Right Data
As channels become more nuanced and complex, access to accurate data plays a pivotal role in developing a successful hotel distribution strategy. A key objective is not to simply capture more data, but to use key data and performance metrics to gain valuable insights beyond simple demographics and basic customer segmentation. Core data sets for channel optimization include economic and competitive markets, and customer-centric information such as regional diversity, website navigation paths, guest profiles, visitor tracking statistics, and stay history.
In order to optimize channels for profitability, you must not only understand the “who, what, where, and when” of your customers, but most importantly, the “why” – the behavioral data, that highlights the factors that guide your guests’ travel decisions. This level of customer segmentation granularity, when analyzed in conjunction with multidevice touchpoints and conversion statistics, offers relevant insights for an effective distribution strategy.
Guest channel preferences are also crucial in developing an optimal channel mix. For example, understanding that 52 percent of millennial travelers prefer to make a hotel booking through an a general travel site versus your proprietary website is highly relevant information to have at your fingertips when trying to reach that younger demographic.
