OTAs: Adversary or Ally?
A New Perspective for Hotel Managers
Question: OTAs - necessary evil or gift-horse?
Ask what hoteliers think of Online Travel Agencies (OTAs), and the term "necessary evil" comes up for many.
Why?
It’s a term that’s been used since Travelocity launched in 1996. Yes, they’ve been around that long.
Hotels are happy to have the business, the “necessary” part, but the “evil” shows up when it’s time to pay the commissions.
Understandably, many view this relationship as a costly, yet unavoidable aspect of business.
Other hotels may see the OTAs as a gift-horse.
Right on, the OTAs are filling up my rooms and I don’t have to do any of the work. Just set it and forget it.
Yikes, that’s an expensive way to operate.
I am here to challenge both mindsets.
However, it's crucial to challenge this mindset.
How we perceive and interact with OTAs profoundly influences our strategies and decisions in managing this aspect of our business.
When you are sitting down to manage your rates and inventory and the feeling you have is discouragement and powerlessness, it sucks! Viewing OTAs as formidable giants or adversaries can lead to feelings of discouragement and powerlessness, a mindset we definitely want to avoid.
Instead, I propose a transformative approach: reframing OTAs not as adversaries, but as valuable partners. This shift in perspective can significantly impact your strategy and overall success.
Leveraging Unique Hotel Experiences Against OTA Capabilities
Rather than asking how to compete with OTAs, consider what your hotel does better than them. What unique experiences and services can you offer that OTAs cannot? This perspective is not about direct competition but about leveraging your unique strengths and offerings.
OTAs indeed have vast marketing budgets and extensive global distribution systems. However, they lack one crucial element that you possess: the unique, personalized experience of your hotel. This is where the idea of a partnership comes into play. It's a two-way street where both parties have something valuable to offer.
The Partnership Mindset: A Balanced Approach
Adopting a partnership mindset with OTAs means recognizing that both parties have something to gain from this relationship. It's not about being at the mercy of a larger entity but about understanding the mutual benefits. This approach can lead to more strategic decisions in how you manage your OTA presence and can even result in reduced commission costs.
In my extensive experience working with hoteliers, I've consistently advocated for this partnership perspective. It's not about eliminating OTAs but about finding a balanced, mutually beneficial way to work with them. This approach is at the heart of successful OTA management strategies and can significantly reduce the feeling of being overpowered by these platforms.
Taking Control: Actionable Tactics for the First Step
The first step in embracing this partnership approach involves actionable tactics that can set the foundation for a successful relationship with OTAs:
Understand Your Unique Selling Proposition (USP): Identify what makes your hotel unique. This could be your location, amenities, personalized service, local culture infusion, or any other aspect that sets you apart from competitors. Highlighting these unique features in your OTA listings can make your hotel more attractive to potential guests.
Optimize Your OTA Profiles: Ensure your hotel's profile on each OTA is complete, attractive, and accurately reflects your USP. High-quality images, detailed descriptions, and updated information are key. This enhances visibility and appeal to potential guests browsing these platforms.
Engage in Rate Parity: While maintaining competitive pricing, ensure that the rates offered on OTAs are consistent with those on your website. This practice builds trust and transparency with guests.
Leverage OTA Data: Utilize the analytics and market insights provided by OTAs to understand your target audience better and tailor your offerings accordingly.
Create Exclusive Offers for Direct Bookings: Encourage guests to book directly through your website by offering exclusive deals or added-value services not available on OTAs. This could include free room upgrades, complimentary services, or special packages.
Foster Direct Relationships with Guests: Engage with guests who book through OTAs to encourage direct bookings in the future. Personalized communication, loyalty programs, and excellent service can convert OTA customers into direct, repeat guests.
Monitor and Respond to Reviews: Actively manage your online reputation by responding to reviews on OTA platforms. This shows engagement and commitment to guest satisfaction.
By implementing these tactics, hoteliers can take the first step towards a more balanced and beneficial relationship with OTas. This approach empowers hoteliers, allowing them to leverage OTAs strategically while highlighting their unique offerings and strengths.
