Direct Bookings vs OTA Bookings

Grow your direct bookings whilst using the OTAs

Direct bookings vs OTA bookings
Direct Bookings vs OTA Bookings

How much more of the “booking cake” can the OTAs (Online Travel Agents) take and how much bigger is the online booking sphere getting? They’re both interesting questions we continue to ask ourselves with a view to helping independent properties generate more direct bookings and reduce commission bills.

There is now evidence that the growth in new online customers is starting to flatten and mature. The OTAs are giant corporations that require continual growth to fire their share price. With fewer new online customers to sell to, the OTAs are looking for ways to keep their growth on target and some have been launching products to control your direct bookings. This strategy of getting income from your direct bookings doesn’t require them to find any new customers yet helps them expand their income. When they manage your direct bookings you are effectively providing them with an opportunity to acquire new customers, your direct customers.

We have also seen some OTAs removing the customer’s direct email address when the booking has originated on their site. In the past they shared these details freely with the property owners but now you need to make the effort to obtain the customer’s contact details. This will lead to less communication between you and the customer, reducing your ability to make direct marketing offers and run loyalty promotions. The knock-on effect is to shift more bookings into commissionable income and reduce direct bookings. Make sure you get contact details of all your guests.

Best Rate Guaranteed
Make sure your customers know, promise them the best rate

How do the OTAs control so much of the online business? Well, they spend billions on online marketing to get customers to book on their website. Along with the expensive adverts they quite often advertise on the search engines under cheaper terms like your property name. When they advertise under your name customers looking for your property will see them first at the top of the Google page. You will also probably see them paying for advertising on other high traffic websites e.g. your TripAdvisor page.

So what can you do about it ? Take your direct bookings very seriously, be under no illusions that you are in competition for your own direct bookings. You need to stop thinking that the property down the road is your main competition. In the online world your biggest competitor is most likely to be the OTA that provides you with the most bookings. If a potential customer has a better website experience on an OTA’s website then that’s where they’ll book.

Direct booking savings re-invested
Re-Invest your direct booking savings to generate more savings

Make sure you have invested in a great website, lots of fantastic images (critical), a great design and good original copy. There is nothing new there but independent businesses are all too often reticent to invest in their marketing, seeing it purely as a cost. Have you ever wondered why the OTAs insist on you uploading so many great images? They know customers are more likely to book with them if they have great images of your property.

A fantastic image led website will generate more direct bookings and save commission. Making sure your website is the best it can be will give you an edge when competing for direct bookings. Some of the big hotel chains even keep their best images for their own website so that they have better visual content for direct customers.

Book direct for benefits
Book direct for benefits

It’s a fact that big OTAs have a global sales coverage that independent accommodation owners can’t match. Learn from the way the big hotel chains do it, they use the OTAs for customer acquisition in areas they cannot reach. Use the OTAs to get the bookings in and convert the customers to future loyal direct bookers. Not all OTAs are the same, some customers have loyalty to a specific OTA that they use most of the time. If you rely on just one OTA for too large a percentage of your bookings then you should probably diversify the source of your OTA business. Work with the biggest OTAs but not just one of them. This gives you more online exposure, access to more customers, reduces your reliance on a specific channel and gives you a better mix of customers. It’s also a lot easier to bargain with the OTAs if you have more than one.

together by freetobook
get together as a group

Co-operation between nearby properties will help grow direct bookings for all. When it comes to getting more direct bookings your main competitor is your OTA. If properties switched from competing with each other to cooperating there would be a mutual benefit for all. Taking it to another level some accommodation owners have enjoyed significant success by cooperating and creating bookable websites featuring their members, examples include Fort William and St Ives in the UK (see freetobook together).

The benefits of more direct bookings are clear, the simplest calculation is the commission. By cutting out the middleman you save precious commission but importantly you also own the customer relationship. You have the customer’s contact details, and from the booking onwards it’s your brand that they will communicate with, not the OTAs. The direct booking message is simple so make it clear on your website, social media, emails, brochures and do let guests know that booking direct is better for them and better for you.

The service you offer from the point of confirmation to their stay with you and beyond is all yours. With direct bookings you have no communications middleman, so take advantage of the opportunity to differentiate yourself and be “special”. Always have the best rate on your website. If you ever feel the need to make a special offer make sure it’s on your website so customers booking direct never pay more.

It can be complex in the online world, as an independent family business we try to keep things simple and in perspective for smaller businesses, there’s lots of bookings out there you just have to keep chasing them.

To find out more about freetobook call, email or visit our home page
Properties group up, Get Together and cooperate

Great, Gratis and Glorious digital marketing ideas to boost direct sales

Gonzo Marketing
Gonzo Marketing

Our guest blog and interview is with Frederic Gonzalo, founder of Gonzo Marketing. With over 19 years of experience in the travel and tourism sphere, he is passionate about marketing and communications.

Frederic recently attended the EyeForTravel event in Miami as a speaker, panelist and participant to the 2015 edition of Online Marketing Strategies in Travel.

Here Frederic generously shares his industry insights and expertise with freetobook. As he pointedly states, having no marketing budget is no excuse for not having a dynamic online presence!

What is the most important trend in online room booking?

It’s about going mobile. More than 51% of travelers now research their next destination, accommodation and transportation from a mobile device, whether it’s a smartphone or tablet. And more importantly, an increasing proportion of them are now booking via their mobile device: in fact, it is estimated that 25% of all online travel revenue in the US will come from mobile devices in 2015.

How can a property get more direct bookings?

1- Have a “best online rate” guarantee and feature it, big and bold, on your home page. People will shop around no matter what, but if they can have the confidence that by booking direct they will get the best deal, well… you got it!

2- Have a relationship marketing approach in place. This can be through a rewards program or simply by capturing emails from clients and visitors to your site and/or blog. Sending out regular newsletters and promotional offers to this base can ensure retention and direct booking through time.

3- Promote deals and best rates across your various social accounts. I see hotels mention a promo code for 10% off best rate… on their Twitter bio. Others do Facebook offers, or mail push to group databases. Think outside the box, and make sure you crossover information from newsletter to blog to social media.

Having no marketing dollars is not an excuse not to have a dynamic online presence.

The first step is to have a professional-looking website, and this can be done with various solutions that cost a fraction of what it used to 3-5 years ago.

Sending out emails? MailChimp is free up to 2,000 email addresses, and other providers offer similar low-cost solutions.

Social media? It’s not free, contrary to what many believe, because someone has to manage it, but you can have impact and reach on Facebook with minimal investments. It’s more a matter of having a strategy in place to begin with, then finding the resources (human and financial) to manage this new reality. Knowing 87% of travel decisions now begin with an online search, do we even really have a choice here?

15 key stats to consider:

  1. TripAdvisor (42%) is the most downloaded mobile app amongst travelers, followed by Priceline (15%), Expedia (14%) and Orbitz (13%)
  2. There are 139 reviews written every minute on TripAdvisor
  3. You lose 25-60% of visitors with each click on the mobile path to purchase.
  4. 69% of travelers begin their search online…via a mobile device!
  5. Average mobile users check their device 150 times per day!
  6. Of the average six daily hours US adults spend on digital media, 3 hours is on mobile.
  7. Twitter on Travel: in the past year, 60M tweets mentioned hotels, 21M tweets mentioned vacations
  8. 70% of followers have taken some action after seeing travel content on Twitter
  9. 70% of Instagram users have looked for a brand online
  10. 3/4 of consumers are frustrated when online content doesn’t relate to their interest
  11. In 2016, 50% of total travel sales will involve more than one device
  12. Ritz Carlton Hotel sees 18% conversions from email campaigns. Email is not dead, folks!
  13. 92% of visitors to a website will never return. Thus, remarketing is key!
  14. Only 27% of hotels send automated emails prior to arrival (and after departing)
  15. According to Google, 1/3 of people with a smartphone would give up sex instead of their phone. Sad.

Visit Frederic Gonzalo’s website for further insights