Getting guests to book directly on a hotel’s website rather than through an online travel agent (OTA) is a key challenge that hoteliers are gearing up to tackle in 2018.
When OTAs first rose to popularity in 2008 during the economic downturn, hotels viewed them as saviors for their ability to fill hotel rooms that otherwise would have remained empty. Today, that view has shifted dramatically.
Popular third-party search engines are raking in more bookings than ever and charging significantly higher commissions, too. In fact, momentum toward convenient aggregate websites has grown to such a fever pitch that in 2016 OTA bookings in the U.S. outnumbered hotel website bookings for the first time in history.
Not only are hotels losing out on a cut of the profits when they pay commission to OTAs, but they’re also giving up the immeasurable value of being able to ‘own’ the relationship with a guest before they even reach the front door. Hotel owners aren’t taking this new relationship dynamic lightly. Instead, they’re wielding their own websites to encourage their customers to book directly.
“Hoteliers understand how important it is to create memorable in-person experiences at their properties, which inspire guests to return in the future,” says Andrea Grigg, Executive Vice President with JLL’s Hotels & Hospitality Group. “But today, the game is increasingly about leveraging their online assets to inspire them to come to the hotel in the first place.”
The OTAs’ secret sauce
Many consumers are drawn to the promise of a good deal – especially one they can find conveniently using an OTA, which aggregates offers, reviews and amenity details. This desire for convenience and one-stop shopping has been fueled, at least partially, by changing demographics.
More than a third (36 percent) of OTAs’ primary customers are between the ages of 25 and 39. Millennials are less motivated by loyalty programs than Gen Xers and Boomers, and are more influenced by the convenience and value of viewing multiple properties and offers in one place.
