A hotel distribution strategy is a plan of action for selling rooms profitably through a variety of channels. A mix of direct channels, such as a hotel’s website, and indirect channels such as online travel agents (OTAs), Global Distribution Systems (GDS) and wholesalers are typically used.
Rethinking hotel distribution
When online travel agencies (OTAs) arrived at the turn of the millennium, they levelled the playing field between big global brands and local hoteliers. A 3-room B&B in the Alps or a family-run Italian osteria could enjoy the same online visibility as a Marriott or a Mercure hotel, attracting customers from all over the world.
“OTAs have become a commodity.”
But now, every hotel uses the same tools for distribution and OTAs have become a commodity. That means it’s once again harder for smaller hotels or chains to stand out against big brands. To make matters worse, standard layouts and quantitative search criteria (number of stars, room price, average user reviews) are making it even harder for hotels to showcase their unique attributes.
To stand apart from the crowd, hoteliers must now seek out new distribution channels. Some have benefitted from the rise in niche travel guides from the likes of Wallpaper, Monocle or Louis Vuitton. Others have started using local partners with complementary offerings as ambassadors.
The Waldhotel at the Bürgenstock resort near Lake Lucerne in Switzerland has partnered with renowned private clinics in the area, who refer their patients to the hotel. In Amsterdam, the Student Hotel relies in part on referrals from local demand generators such as universities and student guides. This type of strategy helps hotels ground themselves in the local scene, offering a more authentic experience and creating new revenue streams tied to local visitors.
Strategic referencing and social media
Affinity-based referencing is another way for hoteliers to stand out, especially when they have a strong concept. For instance, road trip enthusiasts booking a vintage van on Washington-based platform PacWesty are encouraged to stay at the Kimpton Hotel Vintage in Seattle before or after their trip. Virgin hotels are active on local Reddit forums, offering advice on activities, attractions – and where to stay, of course. Social media apps such as Pinterest and Instagram have also become ideal outlets for hotels to advertise, providing more creative control over the experience than with OTAs. So long as they can be tied back to the hotel concept, these new outlets can boost a hotel’s perceived value, reach a more qualitative audience and increase direct reservations.