Within Travel & hospitality, it is essential to serve the right guests at the right moment. Therefore, it is important to understand the full guest behaviour of the end consumer (guest). The challenge for many hoteliers is that online travel agents (OTAs) are cutting away more and more guest information, leaving hotels with anonymous guests. It is essential for hoteliers to gain back control over guest data in a world where Online travel agents are dominating more and more guest data. Every investment in an OTA’s should be viewed as a short-term investment due to the rapidly changing nature of the travel industry. Nevertheless, essential to survive and to drive occupancy.
OTA’s are here to stay and with their power they will have their share in the market. For guests Online travel agents provide convenience, competitive pricing, and access to a wide range of products and services. They offer a wide range of services including flight bookings, hotel reservations, car rentals, travel insurance, tour packages, and more. Additionally, many online travel agents provide helpful tools to guests such as destination guides, expert advice, and reviews. For an individual hotel and even chain hotels it is a hard to compete with, which should give them the focus on creating a top class guest experience. Hotels should also focus on building trust with their guests so that they feel comfortable booking directly with the hotel.
Finding Balance in Hotel Channel Distribution
At MinersRepublic, we believe each hotel can find the right balance in hotel channel distribution. The key is to focus on understanding the needs of guests and work based on available data.
By leveraging the data collected from indirect channels, hotels can compare key metrics such as reservation value, booking window, lead time, and feeder markets. Utilizing the market share that online travel agents possess in the travel industry, hotels can gain insight into the potential variations in demand and make more informed decisions on how to maximize their direct channels. Several OTA’s provide benchmark information to track your performance against competitors. By using benchmark information from other OTA’s, you can gain insight into how you are performing in comparison to your competitors and use this information to improve your results on your direct channels and outpace them.
Simple and Effective Reporting for Distribution Channels
A framework to visualize the distribution mix is important because it provides an instrument for a hotel to shift reservations from indirect to direct, which lowers commission costs. but also from from offline to online, which lowers handling costs.
By understanding the four quadrants of the distribution mix hotels can make more informed decisions when choosing distribution channels.
- Direct–Online No Commission– Automized,
- Indirect–Online Commission Automized,
- Direct–Offline No Commission– Manual Handling, and
- Indirect–Offline Commission– Manual Handling
The goal is to maximize the number of reservations coming through direct channels, while also making sure that there is sufficient coverage of online and offline channels to capture reservations from all potential customers. This will allow the hotel to maximize revenue while minimizing costs.
Setting up a simple reporting system in which direct and indirect channels are distinguished gives insight in the balance of the distribution mix. By capturing data on reservations, hotels can generate reports on several channels. This will help to track performance and identify which channels are most successful, as well as areas that need improvement. Additionally, online travel agents can be further classified based on type(touroperator vs travel agent), feeder markets or commission height. This will help hotels to identify which sources generate the most bookings and revenue.
Identifying and Capturing Guest Information
At the same time, a lot of guest data generated by OTA‘s is anonymized guest data for a hotel. It is essential for a hotel to develop a strategy for capturing the anonymized guest data of indirect reservations in order to gain insight into the guests who book their rooms through Online Travel Agencies (OTA). By understanding the data generated by OTAs, hotels can better tailor their services and offerings to guests, enhancing their overall experience.
An example of a strategy to identify anonymized guest information in a hotel is to make sure guests need to login into the Wi-Fi network. When the hotel is requesting to fill in the email address, room number and name on the login screen, this information can be combined for enhancing future guest experiences. Another strategy to identify guest information in a hotel is to have guests fill out a registration form upon check-in. This form should include the guest’s name, contact information, and payment information.
The above examples are ways to combine information from different sources to identify your guest to create and build up create a guest profile that can be referenced if needed. This information can also be used to enhance future guest experiences by providing personalized services.
Ensure that your guests‘ privacy is respected when capturing guest data. Inform them of the methods you have implemented to maintain their privacy. Collect guest data only with the purpose of improving their experience. Do not share their data with any third parties without their explicit consent.
Hotels should adopt a strategy that finds a balance between direct and indirect reservations, even though online travel agent reservations should be seen as a short–term investment.
By understanding the needs of guests, leveraging the data available from OTAs, setting up a reporting system, and identifying and capturing guest information, hotels can find the right balance in hotel channel distribution. With a well–thought–out strategy, hoteliers can maximize their direct channels and outpace their competitors.
Struggling to find the perfect hotel distribution strategy or get reliable insights? Let us take the hassle out of the equation. Get in touch today and let us show you how we can help.
