Do you currently see the OTAs as a threat, or as an opportunity?

One OTA CEO once told hoteliers that he most definitely represented the latter – pointing out that if he sent a guest to a hotel, that hotel would only be obliged to pay him once. If the hotel subsequently failed to turn that guest into a loyal customer, whose fault is that?

From this perspective, the OTAs do indeed provide a relatively cheap source of new customers. The problem comes when hotels rely on this particular channel for too high a proportion of their business, and when repeat visitors are still booking through the OTA. Such a scenario is rarely sustainable in the long run, so hotels must find ways to reduce their reliance on OTAs.

There are two different starting points from which this can be achieved. The first, as our illustrious OTA CEO suggested, is to convert existing guests into repeat visitors who book directly. The second is to entice first-time visitors to book directly. The strategies involved will necessarily be slightly different.

One difficulty in enticing new customers lies in the fact that the OTAs spend inordinate sums on marketing, rendering the meagre efforts of independent hotels insignificant, and proving to be beyond the reach of even the largest hotel brand groups. Through their relentless promotion, they have persuaded a large proportion of the public that they will always have the best rates. While this is not – or should not – be true, it is a difficult belief to shift. The larger branded players have started to challenge this perception, with Hilton’s “Stop Clicking Around” campaign just one example, but the existence in most countries of the rate parity clauses makes it hard for hotels to compete on price.

Educating the public is one part of the answer. Educating everyone on a hotel’s staff is another; everyone working in a hotel should understand the advantages of direct booking and be prepared to communicate that to guests. Of course, the advantages may be obvious in favouring the hotelier, but may be less beneficial to the guest – so why not add something extra for your direct bookers? A free breakfast or a couple of spa vouchers wouldn’t break the rate parity clause, but would increase the value to the customer of booking direct.

Another possibility today is to use ‘gated offers’, which involves the provision of discounted rates (undercutting the OTAs) to loyalty program members, or perhaps a Facebook group. The key is that the offer is not made widely available to the public – there is a barrier involved. Getting guests signed up to loyalty programs is a vital step in this process, as is the gathering of customer data such as email addresses. Persuading customers to follow you on social media is also vital if this kind of promotion is to be effective.

Whether your potential direct bookers are repeat visitors or new customers, you need to give them reasons both to visit your website and to convert that visit into a booking. If your best offers (with all the extras) are available through your site, you need to make that abundantly clear. Some experts even suggest displaying your competitors’ rates on your own site – which may appear counter-intuitive since it can lead people to consider these alternatives – as it can convince a potential booker that they’re making the right decision. Another idea is to post regular blog-style content, sometimes about your hotel and its promotions, but also about the destination and local culture, since this can attract web traffic when potential visitors search for information about your city.

Once people are on your site, the big issue is simplicity and a clear call to action. The booking and payment process must be absolutely straightforward; if it isn’t, customers will give up. Making the site mobile-friendly is also a must.

If these ideas don’t seem to be enough, there is also the option for independent hotels to join soft-branded groups – whereby the big hotel groups increase their coverage by welcoming independents into the fold, giving them access to the big booking engines, group marketing, and often lower OTA commissions, without forcing a complete makeover to fit one of the chain brands.

The battle between the hotels and the OTAs is constantly evolving, as partners seek to outwit each other to get the better deal out of their relationship. Hotels can’t live without the OTAs – as the OTAs clearly aren’t going away – so they’d better find smarter ways to live with them.

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