The OTA vs. Metasearch Battle and What It Means for You
In today’s travel industry a lot of questions about Online Travel Agencies (OTAs), and Metasearch Engines have surfaced. Metasearch engines provide information on travel products, and hotels, then directs the consumer to the direct booking website. Online Travel Agencies market hotels they have with and allow the guest to book directly through their website.
Top 5 OTAs
Top 5 Metasearch Engines
Knowing guest data and guest purchasing behavior is of utmost importance for independent hotels. Guest data allows hotels to run targeted campaigns that lead to increased occupancy and improved booking conversions. Historically, hotels have always leaned on online travel agencies, or OTAs, to attract new clients and boost occupancy. However, with the emergence of Metasearch sites, the hotel tech industry is changing.
Pros & Cons of OTAs:
Online travel agencies aggregate all hotels in one easily accessible place where consumers can shop and buy. These OTAs help independent hotels boost occupancy, and therefore introduce new guests. In addition, OTAs offer dynamic packaging with unique combination options for guests to book a hotel room, rental car, event tickets and airfare. This is a unique marketing approach that many independent hotels can’t offer on their own.
However, hotels don’t get to access all of the data that direct bookings or direct site users provide. For instance, hotels don’t get to see who shopped their hotel yet abandoned it. They also don’t receive email addresses from guests who book through OTAs. Hotels have to collect email addresses upon check-in and ensure that the email is added to the retargeting campaigns and email marketing. The OTAs are able to use these emails for retargeting, which creates a wedge between the guest and the hotel. When hotels try to collect guest information upon check-in, guests might think they already provided that information to the hotel because they did for the OTA. This could confuse guests and drive the wedge deeper between hotels and their guests.
Pros & Cons of Metasearch:
Metasearch is a great marketing strategy for independent hotels. Metasearch channels can help independent hotels divert traffic from OTAs, so cutting out the middleman to drive direct traffic. This allows hotels to retain all guest data and create a more personal interaction with their guests. Also, metasearch channels give your hotels more room in their budgets so they can offer discounted rates by eliminating OTA commission charges. Metasearch sites also encourage customers to leave reviews, giving hotels a unique opportunity to respond to comments, engage with their guests and reach their audience directly.
Metasearch is a great option if you can ensure that the customer picks the direct link to the website or the soft brand link. If the traveler picks an OTA from metasearch, however, then hotels do not get guest data. Metasearch does not ensure direct bookings but does promote it more than OTAs do. It’s important for hotels to be listed as the “official hotel website” on metasearch channels to encourage direct bookings.
Guests presented with the choice will usually choose to book direct rather than through an OTA. The highest portion of bookings came through direct bookings (36.9%), followed by web bookings (22.5%). Central reservations system bookings (12.8%) and OTA bookings (10.2%) represent the remaining portions. 68% of all travel begins on Google and Google also observes that 52% of travelers visit your hotel website after seeing you on an OTA.
However, metasearch sites do require CPC and CPA budgets and can be hard to manage if the hotelier is not experienced in the channels or platforms to manage spend or ROI. Many agencies or brands will handle this for hotels but hoteliers must be aware that without rules around spend and ROI, the incremental business is not always profitable. It can be difficult to find a soft brand, agency or membership that will cover the CPC/CPA costs for the hotelier thereby ensuring the hotel receives ROI-driven incremental business.
On the surface, OTAs are better, as they have historically driven so much business and are easy to use. However, hotels need to consider the cost-benefit analysis of using OTAs while missing out on guest data. One easy and powerful way a hotel can compete is to get a direct link on the metasites and compete side-by-side with the OTAs for their hotels. The benefit of this is the hotel gets the guest’s email. The downside is it is not free and hard to do without a brand, soft brand or digital marketing agency. Most brands and soft brands have multi-year agreements and don’t provide the guest email address to the hotel owner or management team. Most digital marketing companies ask for a lengthy contract and for the hotel to pay the credit card fees. Only IBC provides short-term agreements and full guest information, and IBC covers the credit card fees. IBC can do this thanks to an excellent team that closely monitors and handles the CPC, CPA fees, and ROI so your credit card isn’t unnecessarily charged thousands of dollars/month.
The future of the independent hotel industry and small business owner depends on understanding and controlling your hotel listing, distribution and guest data. Over time, as independent hotels build their guest information databases, they will be able to create a truly personalized guest experience, encourage guest loyalty and drive repeat margin-rich revenue.
Need help with getting an official listing on metasites such as Google, Trivago, Kayak, Trivago, Skyscanner? Email firstname.lastname@example.org for help now.