All hotels and B&Bs need to find a balance between direct bookings and OTA bookings.
While hotels might not be able to survive without OTA connection, you want to be securing as many direct bookings as possible to avoid commission fees. One way to do this is to first understand customer behaviour.
So what defines travelers who book on OTAs rather than direct and why do they choose to do so?
At the moment, OTA bookings are far outweighing direct hotel website bookings across the world. Data from Phocuswright has revealed in developed markets, between 61-75% of customers used an OTA to shop for accommodation, but only 15-44% visited a hotel website. In emerging markets like China, 90% of online shoppers used OTAs.
What Defines OTA Bookers?
In general terms, an OTA customer might simply be described as someone who searches for the best value, best experience, and has little lasting brand loyalty. While this may be true, OTA giant, Expedia, has unearthed some deeper insights to reveal:
- OTA bookers are tech savvy
Around 40% of traffic to Expedia flows in via mobile devices and a quarter of room nights are booked on mobile. In China, the amount of people searching Expedia on mobile jumps to 60%. Consumers are constantly connected to some form of device, be it mobile, laptop, desktop, or tablet and purchasing habits are starting to reflect this.
- OTA bookers value convenience
The rising cost of living means that consumers like to have options so they can secure the best deal. OTAs give travelers the ability to easily compare a wide range of options in one place. On OTAs, they can also book flights which makes it all the more convenient.
- OTA bookers are young
Over a third of OTA customers are between 25-39, with 82% of 25-34 year-olds travelling for leisure. Leisure is also the main reason for travel in 18-24 year-olds, at 76%.
Why Do Travelers Choose to Book on OTAs?
The Phocuswright report also produced the top 10 reasons travelers book with OTAs and the list provides some positivity for accommodation providers. Three of the most prominent reasons were:
- The website is easy to use (47%)
- I trust the brand (34%)
- Online travel agents typically have the best prices (30%)
What Can Hotels Do to Win More Direct Bookings?
The best thing about the data is that hotels can easily combat these direct booking barriers. Here are the three solutions:
If customers are avoiding direct bookings because of your website, it’s easy to get them back on board with some close attention to key principles of user experience. Without spending money on a web designer, you can use a website builder to quickly setup your website for functionality, mobile optimisation, aesthetic appeal, and make it Google search friendly. With the right provider, all of this can be done almost instantly and can be updated at any time.
Hotels need to work hard to build brand awareness and consumer trust by establishing a very strong online presence. This means being very active and engaging on social media to establish a relationship with customers, and paying close attention to your management of online reviews to ensure your reputations stays strong. Again, your website and content need to be trustworthy and authentic to make sure visitors enjoy a good experience.
While you can’t dramatically undercut the OTAs and start a price war, you can add some incentives to encourage travelers to book direct. Packages are a great way to give customers more for their money and are something you can offer exclusively via your website. There are also many way to drive up guest loyalty, such as hotel programs and promotions.