Knowing where to list your hotel and the prices to charge can be tricky, especially for busy operators of small, independent properties.
NB: This is an article from RoomPriceGenie, one of our Expert Partners
Subscribe to our weekly newsletter and stay up to date
It’s not just about being visible on booking channels to help travelers find you; it’s equally important to set room rates that convert these travelers into guests.
What are the pros and cons of different distribution channels? And how can you make your property stand out? Here we explain the essentials of hotel distribution and pricing.
1) Decide Where to List Your Hotel
Distribution channels vary widely, each serving distinct market needs and offering different benefits. Here’s a breakdown of the main types of channels:
- Direct channels: These channels enable travelers to book directly with your property, including on your website, by phone, or by walking in.
- Online travel agencies (OTAs): These are websites where travelers book accommodations and other travel services. Globally, the OTA space is dominated by two companies: Booking Holdings, which owns Booking.com, Priceline, and Agoda, among other sites; and Expedia Group, which owns Expedia.com, Hotels.com, Vrbo, Travelocity, and others.
- Global distribution systems (GDS): These reservations networks are used by travel agencies to book hotels and other travel arrangements on behalf of clients. The three main providers are Sabre, Amadeus, and Travelport.
- Wholesalers and bed banks: These companies purchase rooms from hotels in bulk and sell them to tour operators, OTAs, and travel agencies. Three of the largest are Hotelbeds, WebBeds, and HPro Travel.
- Metasearch platforms: These sites display hotel pricing and availability from various booking channels, allowing travelers to compare the options on a single page. Popular platforms include Google Hotels, Tripadvisor, Kayak, and Trivago.
OTAs: Too Much of a Good Thing?
Considering the commissions charged by online travel agencies, typically from 18 to 25% of room revenue or even more, some might say hotels have an unhealthy dependency on OTA business.
This is particularly true of small, independent properties, for which 60% of bookings on average came from OTAs in 2023 – the highest level in five years, according to Cloudbeds data. In Europe, OTAs accounted for an incredible 76% of bookings, compared to 64% in Asia Pacific and 48% in North America.
Distribution Strategies for Independent Hotels
Rather than signing up to every possible channel, hoteliers are wise to choose channels where target guests are most likely to book. Here are some tips:
- Diversify your distribution mix. Relying too heavily on one or two channels is risky, especially expensive ones like OTAs. By listing on several channels, you can reach a variety of traveler types in different regions of the world.
