Reducing your OTA commissions; is it worth it? As Dennis Schaal recently reported in “The Definitive Oral History of Online Travel”, it’s been more than 25 years since the birth of online travel and there are key innovators that led the change in hotel commerce with websites like hotels.com, Travelocity, Priceline, and naturally Expedia.
One of the things that struck me throughout this story, and as Dennis points out, thought leaders at these companies were emotionally attached to the idea of pioneering a new way for consumers to shop and purchase travel. And so it began.
Today, all day, every day we hear about the love/hate relationship between hotels and the OTAs. It’s a dilemma for many owners and managers who depend on the broad and expansive reach of an OTA to draw in business when needed, but resentful of fees paid particularly during more fruitful times.
Many independent hotels don’t understand nor have the budget to compete with these mega-digital marketing machines, and the brands don’t have deep enough pockets to go head to head with the biggest OTAs who are spending more than $2 billion just with Google alone.
I loved Sabre CEO Tom Klein’s perspective recently reported by Tnooz. “Travel is complex. Travel is messy. Travel is not 90% margin like many of the businesses that Google and Facebook and others are in”.
All the more reason to run your own race and obsess on what matters most to the guest, at which point you you’ll be able shut out a lot of the noise that is distracting to your marketing strategy.
This article addresses the dollars and sense of moving OTA bookings from their “wallet” to yours. Let’s start with a case study example of a small B&B property in Washington, D.C.
Malolo Bed and Breakfast
This charming B&B is a labor of love for owners David Alaga and George Lopez. Guests experience firsthand the care that goes into everything, from the cozy rooms to the elaborate meals complete with authentic Hawaiian entertainment. Malolo means ‘to rest’ in Samoan, and that’s exactly what guests do when they’re at this property – it’s a little slice of Hawaii in DC.