Hotel Direct Bookings: Breaking Down How Hotels Can Win the OTA Battle in 2023
By Jordan Hollander
Last updated March 22, 2023
5 min read
Wondering how to reduce your reliance on online travel agencies like Expedia and Booking.com? While the OTAs can be meaningful sources of revenue and help your hotel gain exposure to potential guests, it can make more financial sense – and deliver a better guest experience – to shift share from OTAs to your direct channel. Avoiding commission payments might be the most obvious reason to encourage guests to book directly, but direct bookings also benefit from smoother communication and clearer expectations, plus the opportunity to convert guests into loyalty program members. So, how can you win the battle against OTAs? We’ll break down seven strategies that you can leverage to boost direct bookings and pay lower OTA commissions.
Optimize your website for conversion
Before you even think about getting more direct bookings, you must have a functional, user-friendly website. OTAs run countless A/B tests and invest in user research to build the hotel websites that garner the highest possible conversion; if you want your website to be competitive, it has to be easy to use. At a minimum, make sure your site loads quickly and that no errors appear on desktop and mobile devices. You should have a “Book Now” button in a visible place on every page so guests can navigate through your booking process. And on the checkout page, you can boost conversion by accepting a variety of payment methods, especially mobile payments like ApplePay and Google Pay, and by not charging any surprise fees.
Get more visibility online
Once you have a well performing website, you can work to generate more traffic that will convert into bookings. Search engine marketing is a great way to quickly (and relatively cheaply) get more eyes on your website. Even if you don’t have much experience with paid search, platforms like Google Ads and Bing Ads walk you through the setup process and provide plenty of training resources to help you succeed. In addition to Google Ads, which show at the top of Google search results pages, your website can get more visibility through Google Hotel Ads, which puts a direct link to your website on your hotel’s Google Maps listing. Email marketing, social media campaigns, blog posts, and Youtube videos are more examples of strategies you can use to push more traffic to your website.
Build trust with potential guests
But getting traffic on your website isn’t quite enough if you want to shift meaningful share from OTAs to your direct website. You must build trust with guests: both trust in the experience your hotel will deliver as well as trust in the actual booking process. Guests don’t want to hand over their personal information and credit card number to a website that seems fishy; by maintaining a secure socket layer (SSL) on your site, guests can be confident that their data will be encrypted and stored securely. Your booking engine should also minimize redirects; guests will be wary of a site that starts on one URL, directs to another URL to browse pricing and availability, then directs to yet another URL for payment.
In addition, your hotel should proactively work to maintain a strong digital reputation. Social proof, like guest reviews and ratings, paint a picture of what the experience will be like at your hotel. Encouraging past guests to write reviews on sites like Google and Tripadvisor will help you bolster your online image and make potential guests feel comfortable booking directly.
Use data to personalize the booking experience
Another thoughtful way to increase conversion and direct bookings is to personalize the booking experience on your website. Even if you don’t know any personal information about your potential guests, you can still incorporate search terms on your landing pages, show recommended tours or activities, and display recent searches so guests can quickly get back to where they left off. If you have captured personal information about guests, like if they’ve stayed with you before and are signed into their account, incorporating their first name or stay history into the booking experience can strengthen the relationship between your hotel and your guests.
Offer competitive rates and compelling perks
Guests visit dozens of different websites during the purchase process, so it’s likely they’re comparing the rate on your direct site to your rate on the OTAs. All else being equal, guests will pick the cheapest rate, so at a minimum, your direct site should have a rate that matches your rate on the OTAs. To reinforce your commitment to offering the best rate on your website, you can add a price comparison widget to your checkout page, which shows real-time rate comparisons on several sites your hotel is listed on, and you can maintain a “best price guarantee” in which your hotel matches any cheaper publicly available rates.
In addition to offering better rates, or if you can’t offer better rates than what you sell on the OTAs, you can sweeten the deal by offering special perks only available to guests who book direct. For example, you might offer free breakfast or parking, or guaranteed early check-in or late checkout. A F&B or spa credit is another compelling perk which can also drive incremental revenue.
Add a sense of urgency
Even if you have the most user-friendly website and the most competitive rates, sometimes guests need a little extra nudge to complete the booking process. You can create a sense of urgency through limited-time discounts, promotions with countdown clocks, or even a count of the number of rooms left on the guest’s travel dates. These subtle hints will convey to guests that your hotel has perishable inventory, and if they don’t book now, someone else might snag their room.
Give guests reasons to stay with you again
Getting one direct booking is great, but ideally you want that guest to book directly for all their future stays at your hotel. To encourage guests to book direct again, or to nudge past OTA guests toward booking direct next time, you’ll want to nurture the relationship so your hotel remains front of mind. Sending email newsletters and asking guests to follow your hotel’s social media account can keep guests engaged and updated on happenings at your property. While a loyalty program is an excellent way to get repeat bookings, loyalty programs aren’t always feasible for small or independent hotels. As an alternative, consider special discount codes or amenity perks for repeat guests who book direct on their future stays.
Direct booking is a crucial component of the distribution mix for hoteliers because it helps them to increase revenue, improve guest experience, and reduce dependency on online travel agencies (OTAs) such as Expedia and Booking.com. By utilizing a booking engine on their own hotel website, promoting through social media, email marketing, and metasearch sites, hotels can increase the number of potential guests and bookers who visit their website and make a direct booking.
Increasing direct bookings allows hotels to bypass the high commission fees charged by OTAs, which can range from 15-30%, and improve revenue management by controlling the booking process and upselling additional services or perks. Additionally, direct booking channels offer real-time availability, better rate parity, and the ability to create user-friendly booking processes that improve conversion rates.
Direct booking also allows hotels to establish their brand and create a stronger relationship with potential customers. By offering special offers and loyalty programs, hotels can incentivize guests to book directly, leading to a higher occupancy rate and revenue.
Direct booking strategy also includes integrations with other technologies such as channel managers, PMS, chatbots, and digital marketing campaigns, which help to streamline the booking process and enhance the guest experience.
In conclusion, maximizing direct bookings helps independent hotels to reduce their dependency on OTAs, increase revenue, and provide a better guest experience. By utilizing digital marketing, offering user-friendly booking processes, and creating a strong hotel brand, hotels can improve conversion rates and create a sustainable distribution strategy.
What are your direct booking goals for 2023? By applying these 7 strategies to boost direct bookings, you can shift share away from OTAs and begin to strengthen your direct channel, which can lead to better guest review scores and increased profitability.