In today’s digital age, Online Travel Agencies, or OTAs, play a significant role in the hotel industry.

NB: This is an article from Topline Revenue Management, one of our Expert Partners

Understanding their impact on hotel revenue management is essential for success. In this blog post, we’ll explore how OTAs influence your revenue strategies and reveal insider tips to help you thrive in this dynamic environment.

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The OTA Revolution: A Double-Edged Sword

The Rise of OTAs

Online Travel Agencies have revolutionized the way guests book accommodations. With a few clicks, travelers can explore a world of options, making it easier than ever to find and book hotels.

The OTA Challenge

While OTAs bring bookings, they also come with commissions and increased competition, affecting a hotel’s bottom line. So here are some of our insider tips on how to master the OTA landscape in today’s digital era:

Insider Tips for Hoteliers and Revenue Managers

Tip #1: OTAs as Distribution Channels

While OTAs can be seen as competitors, they can also function as valuable distribution channels. Here’s how to make the most of them:

Create a Channel Mix Strategy

Develop a channel mix strategy that outlines the percentage of bookings you want to allocate to OTAs and direct bookings. This allows you to balance your distribution channels effectively.

Diversify OTA Partnerships

Don’t rely solely on one OTA. Diversify your partnerships to reach a broader audience. Consider working with OTAs that specialize in specific markets or niches.

Tip #2 : Negotiate Commissions

OTA commission rates aren’t set in stone. Negotiating better terms is possible, especially if your hotel generates substantial bookings. Here’s how to go about it:

Gather Data

Collect data on your hotel’s performance, including occupancy rates, revenue generated through OTAs, and the number of bookings. This data can be used as leverage during negotiations.

Initiate Negotiations

Reach out to your OTA representatives and initiate negotiations. Highlight your hotel’s performance and discuss the possibility of reducing commissions or securing promotional opportunities.

Tip #3 : Channel Management Software

Channel management software is a game-changer for managing OTAs effectively. Here’s how to make the most of it:

Invest in the Right Tool

Research and invest in channel management software that suits your hotel’s needs. Ensure it integrates seamlessly with your existing systems and provides real-time updates.

Regularly Update Inventory

Consistently update your inventory and rates across all OTA platforms. Missing out on bookings due to outdated information can be costly.

Tip #4: Rate Parity Monitoring

Rate parity is crucial for maintaining trust with potential guests. Here’s how to monitor it effectively:

Use Rate Parity Tools

Utilize rate parity monitoring tools that can track rates on various OTAs in real-time. These tools can help you identify and rectify discrepancies promptly.

Implement a Rate Parity Policy

Create an internal rate parity policy that ensures consistency across all distribution channels. Train your staff to adhere to this policy to avoid unintentional rate disparities.

Read rest of the article at Topline Revenue Management