The competition for direct bookings has entered a new phase, according to experts in hospitality technology, with online travel agents ( OTAs ) stepping up their efforts to seize control of hotel guests and their booking experiences.
For the first time, the new lodge industry reveals that hotels are seeing a decline in their immediate booking share because of the sharp rise in OTA marketing spending. This demonstrates the shifting dynamics and effects of the OTA-hotel connection, which has historically benefited one another.
In 2023, direct bookings made up 38 % of all reservations, a slight drop from the previous year’s 39 %. After the pandemic’s treatment, this percentage remained constant for two years. Direct tickets made about 7.8 million reservations international in 2023, reflecting their importance in the global hotel industry.
Since they do not include group, general, or other contract bookings made through PMS platforms, the aforementioned figures for” share of” will be higher than industry averages. The fad they reveal, however, is still very important.
Additionally, the extra money set aside to support this transition is showing up in different ways as well. Cost-per-click prices have suddenly increased as a result of an increase in competition for important search terms like manufacturer searches that focus on particular hotels. In particular, Google Ads have increased by 62.5 %, increasing from$ 0.16 to$ 0.26. The impact on Metasearch is even more pronounced, rising from$ 0.21 to$ 0.48 with an increase of more than 128.6 %.
In order to produce customized search results for customers, website vehicles in the traveling industry combine data from various sites. On a single, user-friendly results page, they provide detailed information about flights, lodging, car rentals, and vacation plans. Two well-known website vehicles in this industry are Kayak and Trivago.
The decline in organic search revenue, which is down 15.3 % from the previous year, has occurred at the same time as the 15.5 % increase in revenue from paid search. In order to compete with online travel agencies ( OTAs ) and keep them from monopolizing high-intention traffic, which was previously dominated by organic search, hoteliers are forced to devote more resources to pay-per-click ( PPC ) advertising.
The number of visitors looking for longer stays through direct orders has increased as a result of OTA strategies. The proportion of room nights attributed to indirect bookings has significantly increased as a result, increasing from 53 % to 56 % in 2023. Around 65.6 million room nights worldwide are affected by this shift.
The study’s findings support the idea that the visitor trip, lead generation, and host profile are the main elements influencing the future role of OTAs in the hospitality sector. Hotels may become overly reliant on OTA lead generation, making it financially impossible for them to regain their current share of bookings and achieve a satisfactory return on advertising spend ( ROAS ), according to experts.
According to the report, operators can solve their problems by implementing cutting-edge technologies like AI-driven guest personalization, loyalty program optimization, and predictive analytics to reduce delays and pointless discounts. However, the window of opportunity for implementing these devices is closing.
The kindness sector is in a critical juncture. The opportunities for hoteliers to draw in potential customers are being equalized by lodge technology, but the long-term advantages might not last forever. There is fierce competition among visitors to sign up for loyalty programs and control their journey preferences—possibly for the rest of their lives. Prioritizing personalization and claiming ownership of the guest profile is a priority for both online travel agencies ( OTA ) and hotel chains.
A thrilling period of growth is currently taking place in the kindness tech sector. We can anticipate seeing major changes over the coming years that will completely alter the tourist experience. The way visitors socialize with hotels may experience a remarkable evolution, from cutting-edge AI search capabilities to highly personal services. Along with these chances, there are also possible dangers. It is obvious that resorts that do not adopt and use the most recent technologies run the risk of losing out to rivals who are more eager to make the required investments in terms of tourist acquisition. Therefore, this might have a negative effect on their expansion and success. SOURCE: Hotel Direct Bookings vs. Online Travel Agents: eTurboNews |ETN