Online Travel Agency (OTA) bookings seem to be taking over the world. Consumers can’t google “travel” anymore without an OTA popping up with an enticing offer.
OTA bookings are discounted travel bookings conducted by an online travel agency. Rather than booking directly with the hotel, cruise, or travel group themselves, a middle man steps in to handle the booking — often at the expense of the company actually hosting the traveler.
One of the biggest battles in the hospitality industry is how to take back bookings. When it comes to OTAs vs. direct bookings, it shouldn’t come as a surprise that direct bookings are better.
Let’s dive a little deeper to figure out how OTAs effect the travel industry and what you can do about it.
Who are the biggest OTAs?
As we mentioned before, OTA bookings are the leading way people book travel these days. Why? OTAs make it easy to search a location, compare prices, and book all from the comfort of home or a mobile device.
Consumers can move from one OTA to the next in search of a better deal.
The ease of use with these travel websites is what makes them so attractive to travelers. Nobody has to pick up the phone to make a reservation. Customers can book an entire package, from flight to travel accommodations, all in one fell swoop. Right there from the OTA’s website.
OTA booking can come at a high cost on the other side of the screen. So, what’s truly better for your business? OTA or direct?
OTA vs. Direct Bookings
OTA Pros and Cons
An OTA can be beneficial to your business by giving you more visibility online. You’re much more likely to appear in an OTA search than you would on Google.
Companies also have control over the number of rooms they offer up, the price of the rooms, as well as the listing itself. You provide the photos, descriptions, and any other relevant information. Most importantly, you can list your offerings free of charge.
The con here? If someone books through the OTA, you have to pay them a 15-20% commission on the entire stay. Since over 76% of bookings are made via an OTA, this can be a significant price to pay.
Direct Booking Pros and Cons
Direct bookings are preferable as you’re not paying out any commission to an OTA.
Having full visibility into your customers stay is also a major pro. Being able to communicate with them before, during, and after their stay can help you showcase your additional offerings and upsell. This is something most hotels can’t do when a customer books through an OTA.
Making 100% of your profits through direct bookings isn’t unheard of, but it’s exceptionally unusual.
OTAs offer a lot in the form of marketing and discovery, something that wasn’t an option before they came around. Despite that, there are still ways to take back some of that OTA commission.
How to take back your OTA bookings
You might never get to the point where 100% of your bookings are direct. However, there are plenty of things you can do to increase the number of direct bookings.
Mobile Friendly Websites
As people continue to use their phones to research and make purchases, it should come as no surprise that you need to have your website optimized for all screens, but especially for mobile devices.
The easier you make it for people to see your prices, look at rooms, and complete a transaction — the more likely you are to make that direct booking.
View your website through the eyes of your customer and see what you can do better. Focus on ease of use, searchability, and highlighting incentives for direct bookers.
Now that you have customers on your website tell them what you want them to do. Make your discounts and CTAs clear with bold font, pop-ups, and banners.
If you’re offering specials or packages, highlight that right when they come to your page. If customers don’t know what you’re offering, how are they supposed to take advantage of the deal? Don’t give them any reason to close the window on your incentives.
Incentivize Direct Bookings
Offering an incentive for direct bookings can hook a potential customer. A recent study showed that 48% of customers would book direct if given an incentive, such as a room upgrade or free room service.
Get creative. It doesn’t have to be a discount on their stay, but it should be an enticing offer they’ll have a hard time resisting — free breakfast, a bottle of wine with the room, or free experience.
Do something you know your customers love. Make sure the call to action on the incentive is clear.
Incentives are one thing you can do to increase your direct bookings substantially.
Highlight Your Reviews
One of the reasons customers use OTAs is the ability to look at the reviews and ratings. So, make sure that your website highlights your accolades and reviews as well.
Potential customers shouldn’t have to look elsewhere to see your positive reviews. Whether it’s a widget on your website or reviews you include yourself, make them eye-catching and easy to read.
Travelers are looking for a unique and relaxing experience. If you can show them that’s what you’re good at – right when they’re ready to book – you’re more likely to convert them directly.
What Makes You Special
The most important thing any property can highlight is what sets them apart. Are you near a unique attraction? Do you offer something most places don’t? What are you doing differently?
These are things that an OTA doesn’t know and likely won’t highlight. If customers are coming to your website, make sure they know their experience is going to be special.
Show them why you’re different and how you’ll make their trip unique.
Even if it’s something small, make sure you’re setting yourself apart from all of the competition.
Get Social Media Savvy
People use social media for everything these days. That includes checking out a potential vacation spot.
Stay on top of your social media by posting consistently and highlighting different aspects of the traveler’s experience. Use the right hashtags, take aesthetically pleasing photos, and engage with previous visitors. Consider leveraging influencer marketing.
Social media can have a positive effect on your direct bookings. Your posts can help customers envision themselves at your property. It brings the experience to life.
So, when it comes time to look at your marketing plan, make sure you have a compelling social strategy. It’s more than just a marketing tactic. Social media helps you engage with travelers where they already are. It gives you the opportunity to share your story and learn more about your customer.
This is a unique area that OTAs have little influence on. Make it yours.
When it comes to OTAs vs. direct booking, direct bookings will always come out on top. If you can find ways to funnel traffic directly to your website, do it.
OTAs can serve as an exceptional marketing partner if you set your web presence up for success. You can’t get around the benefit that OTAs provide, but you can take advantage of it.
These simple tips can help you convert some of that OTA traffic into direct bookings while also taking a little bit of the sting out of those OTA commissions.
So, what are you waiting for? Get those incentives and CTAs ready to capture your customer’s attention today.