In The OTAs vs. Direct Booking Battle, The Consumer Wins

Direct Booking

Much has been written about the so-called war between OTAs and hotels over third-party bookings vs. direct bookings. As OTA commissions have increased (along with their advertising spend and potential reach), major hotel chains are making a push to drive direct bookings. Hilton’s “Stop Clicking Around” campaign promises consumers the best experiences and lowest prices when they book direct on Hilton.com. Marriott’s “It Pays to Book Direct” touts the benefits of Marriott Rewards, including the best rates, points, and free wi-fi.

So who’s winning? OTAs continue to gather market share each year, currently at 39%. A Phocuswright report predicts that to increase to 41% by 2020. However, time will tell if hotels’ efforts to drive direct booking pay off.

In the meantime, who’s really winning? Actually, the consumer. As often happens when fierce competition is afoot, the consumer benefits. From a buyer’s perspective, there are advantages to booking both through an OTA and directly with the hotel.

OTAs Are A One-Stop Shop And A Researcher’s Best Tool

An OTA is a travel consumer’s best friend when they’re scoping out their vacation plans. They can see all the options available from flights, to hotels, to packages and more. OTAs and their rich search engines are also an incredibly useful research tool that helps the consumer find the best hotel based on price, location, and quality.

OTAs are often a consumer’s first introduction to a hotel that may become one of their favorites. From a hotel’s point of view, though they pay a commission to OTAs, they also get a good stream of first-time customers, plus visibility to millions of eyes cost-free (until a room is booked). They also get increased web traffic straight from OTAs; according to a study by Google, 52% of OTA visitors click through to the hotel website for more info.

Hotel Sites Can Give Loyal Customers The Royal Treatment

On the other hand, repeat customers who book directly through the hotel get a different set of benefits, particularly if they participate in the hotel’s loyalty program. Successful hotels are able to create loyal customers by providing great experiences. Great experiences are created by knowing who their customers are. When a room is booked directly through the hotel, the hotel can gather rich customer data, including room preferences, that can help them cater to their loyal customers.

When hotels receive direct bookings, they’re also able to communicate with the customer before, during, and after the stay, so they can provide useful information for the traveler. They can also keep in touch about special deals and loyalty perks that may not be widely available or known. Having a direct line of communication with the hotel can also make changing travel plans easier for the consumer than if they’d booked through an OTA.

The bottom line is that both OTAs and direct bookings provide value to consumers in different ways, depending on where the consumer is in the buying process, how familiar they are with a property, and if they participate in loyalty programs. While hotels may love to hate OTAs, they provide a valuable customer stream to them.