Hoteliers of all types and sizes often ask me about the relationship with ATOs (Online Travel Agents) and why direct bookings are shrinking while ATOs are growing. Many accommodation houses are experiencing OTA bookings at around 50% of their total bookings. In reality this means 50% of their income is being commissioned at around 20%, in some cases even more.
From the customer's point of view, they often assume they are booking direct with the property. Conducting a Google search and click the property name, only to be redirected to an OTA, is annoying to both the customer and the property. Aside from the obvious of reduced revenue for each available room, the accommodation house also miss out on building their most valuable asset, their guest history.
Hotels and resorts are often forced to rely on the OTAs for way too big a percentage of their occupancy. Make an impact on your revenue per room, reduce costs, grow your database, and improve the overall guest experience.
Now with the introduction of ordering and booking Apps across the globe, restaurants and cafes are in much the same predicament. I have recently discussed these options with a few local restaurateurs, who are also becoming increasingly frustrated with the impact apps like menulog, deliveroo and Ubereats are having on their customers' dining experiences. Some apps for delivery services charging a whopping 33% commission on the total bill.
But let's focus on accommodation houses today.
Start with your customers, information IS the key to increasing your occupancy and reducing your OTA percentage!
Gather all the information you can associated with your guests' and never allow a guest to check-in and check-out with just the information provided by your ATO, “Booking.com or AirBnB”. Don't be too quick to cut off the OTAs all at once though, start with a "data mining" strategy to ensure that when a guest checks-in from an OTA, that guest become a direct booking in the future. Capturing your guest’s contact information,name, primarily email, mobile number at check-in is critical to the future of your business.
Ensure you use the information obtained responsibly and effectively. Don't spam them but ensure you send them special offers, bonuses and encourage them to book with you when there are special events in your area. Build an automatic targeted email campaign to your OTA guests after their stay, with a short survey to help you improve their experience next time they stay. This triggers OTA guests to change their behavior and book direct.
I for one will make my own decisions and most people prefer to do so. Add value to encourage them to book with you directly. Added value can be simple but much more attractive than discounted rates. Involving complementary businesses in your area can also add value to all and boost your regions image and online footprint.
OFFER SPECIAL RATES
A "best rate guarantee" can be as simple as a price match, a 10% bonus or a late checkout. In my experience an added bonus for direct bookings rather than discounting allows everyone to win, ensuring the only way to qualify for the guarantee is to book direct. Promote your guarantee on your website, in your marketing material, your social campaigns, and everywhere and everyone you market to.
Loyalty programs are a big driver in both data mining (above) and direct bookings. If your property management system is able to generate membership levels, utilise it. Development of a customer loyalty program encourages regular stays, and by utilising partnerships with other local businesses attracts a network of frequent followers, especially if your businesses is not large enough to go it alone. Utilise your local tourism organisation and membership base.
Enhance their experience and not only will they will keep coming, they will tell everyone about your service. Make your direct booking guests feel extra special and you’ll soon find you will have many more. Look at what the majour hotel groups offer, but taylor it to your customers.
Ongoing debate over the effectiveness and whether it is really necessary, especially when competing with your OTA have been a bug bear for many years. Real research shows that brand PPC is the most effective, providing a return greater than just PPC or organic searches alone.
Paid online advertising to promote your brand will reduce your reliance on OTAs. Why? Customers who are close to the end of the booking process make the majority of brand searches. ATOs OWN the search pages, but it doesn't have to be that way, get help and own YOUR brand
Reclaim your brand and take the fight to the OTAs, there are several tools that allow you to do just that. In 2015, Google very quietly made changes to their AdWords, introducing Hotel Price Ads (HPA), while TripAdvisor initiated their InstantBook program, allowing independent hoteliers the ability to compete side by side with the OTAs.
**The booking system or property management you use is critical here, not all are partnered with Google.
To drive direct bookings, you ABSOLUTELY MUST have the best rates! If the price in the adjacent screenshot is less, the customers will not book direct. The critical point here to enable you to compete with the OTAs is to ensure every search from your website to TripAdvisor, Google or an OTA, always results in the best rate being a direct booking with the property.
TRIP ADVISOR The InstantBook program gives individual hotels the ability to drive direct bookings through a commission program. Though Tripadvisor is acting like an OTA in this instance, receiving either a 12% or 15% commission per booking, when combined with a TripConnect CPC program, it creates an effective block to OTAs stealing your guests from TripAdvisor.
GOOGLE Google Hotel Ads provide another option to compete with OTAs and ensure that when the customer is searching for room rates, your pricing and site appear alongside the OTAs. Configuration is critical! When administered and applied correctly, helps you drive more direct bookings.
Many accommodation providers do not have the time, energy or resources to really challenge the ATOs at their roots.
We can help!