We all know the current online booking model. The OTAs present the customers with a list of hotels to choose from, and the hotels pay commissions so that the OTAs include their properties on that list. But just how valid is such system in the modern days? Aren’t there better ways to handle the subject?
The war between the OTAs and the hoteliers has become more fierce in the past years. The hoteliers feel like they are being used and seek for a change, very rightfully so. As the popularity of the online booking platforms rises, the commissions are being elevated as well, a practice that seems simply unfair. Something that started off at a level of a few percent is now nearly twenty percent. But the hoteliers don’t have a way out. Over 80% of all property owners rent their rooms via online travel agents.
The OTAs have become way too popular not to use their help, and because individual hotels are not as well known as the OTAs themselves, they have to rely on OTA popularity and pay the price. It almost feels ridiculous that someone else took over what used to be one of their core responsibilities – creating bookings.
It is not easy to fight the existing system, but it is not impossible. Larger hotel chains do that by giving special discounts to the customers booking directly through their websites and hiring marketing and AdWords specialists to make sure their own websites come before those of the OTA in the searches. But it is a pricey strategy and most hotels can’t afford it.
What are the other options? Fighting the unfair name-bidding and rate parity policies. Speaking up about the unfair treatment. Making sure one’s own website is attractive for the users, or…wait for a revolution on the OTA market.
About the author
Michael Ros is the CEO of Bidroom.com. A natural-born entrepreneur, Michael started his first company at the age of 18. From the age of 24, he worked for 4 years for a large international enterprise and was responsible for a turnover of 45 million euros per year. Thereafter he founded the online travel agency Travelservice. Michael is a creative sales person with experience in negotiating at a corporate business level. Currently, he oversees Bidroom’s marketing, PR and sales.
