Buell Group runs a regular series of Businesses Exchanges, connecting and networking people who are serious about business, and addressing key issues affecting the sector.
Metro Bank, Holborn hosted the most recent Exchange, which addressed the question ‘How can hotels drive more direct business without alienating the OTAs?’ As could be expected, a lively discussion ensued.
Chaired by Ally Dombey ofRevenue by Design, she was ably supported by Tim Walsh, Regional Director of Travel Click, Mike Ball, Ex-CEO of IHS & Worldhotels, Joel Brandon-Bravo, Managing Director of Travelzoo, and Paul Barton, Product Director of Avvio.
The debate was wide ranging and recognised that there is no ‘quick fix’ for most hotels, however some useful, practical observations and points emerged, to many of which H&C News plans to return in more detail in the months ahead.
Mirror Marketing: it was recognised that this practice – whereby OTAs bid online on a hotel name, attract traffic, and receive orders that could go direct to the hotel, with the result that the hotel ends up receiving discounted revenue for the business – is a particular problem for independent hotels and small groups. Big brands can and do preclude this practice in their contracts with OTAs, others should try, and trade associations should provide active support on this issue.
- However, current litigation may establish some legal protection for trademarked hotel brands: watch out for news if this happens.
Rate Parity: the requirement that the hotel sells at the same rate across all channels. See the recent H&C News article from Avvio on this subject: Changing pricing practices in the UK hotel market Because hotels have to compete in the marketplace, they cannot simply and always increase prices to build in commission.
- Again, there may be good news and clarification in due course: apparently France is considering this issue and may seek European change…though that’s unlikely to be quick.
The direct booking experience: how easy is it for the customer?The OTAs have this down to a fine art: it’s a fast, straightforward process. Not all hotel websites make it fast or simple to find the information wanted, then to book – what’s the experience for your guests?
Cancellation policy: again, the OTAs set the example here. If hotels do not match their cancellation terms, customers will perceive the disadvantage and not book direct.
Customer database: how many hotels put enough effort into building, maintaining and utilising their own customer database – whatever the original source of the guest? However powerful and marketing ‘savvy’ the OTAs, it’s the hotel which establishes a personal relationship with guests, which it can use to capture contact details, feedback, information on special occasions – and use to attract repeat business – loyalty.
Airbnb: watch out! It’s still early days but, in some locations, already building significant market share. Will it attract new customers, or divert existing ones? Again, it may become subject to regulation that will reduce some of its advantages, but how soon? In the meantime, hotels need to market themselves and their attractions more effectively.
For more information click here