When reaching more customers and bookings, there are a number of distribution channel options where hotels can be present. Naturally, with the growing dependence on the “online world”, online distribution channels should be privileged.
The hotel does not need to be present only in one distribution channel. The plurality of available distribution channels allows the hotel to be sold in several. It is beneficial to do so, so you can monetize your hotel business by maximizing revenue and occupancy.
Online hotel distribution refers to the process of making hotel inventory available for booking through various online channels. It involves partnering with third-party booking platforms and travel agents to sell hotel rooms online. These channels include online travel agencies (OTAs), metasearch engines, and the hotel's own website. By utilizing these channels, hotels can expand their reach, increase their visibility, and attract more guests.
OTAs are third-party websites where hotels can list their properties and reach a larger audience than their own website. Popular examples include Booking.com, Expedia, Agoda, and Airbnb.
Hotels pay a commission fee for each reservation made through the platform, up to 25% of the reservation price. Despite this, hotels still choose to work with OTAs for increased visibility.
To optimize OTA listings, hotels should include high-quality photos, highlight amenities, and emphasize nearby attractions.
The in-house booking engine is the primary source of bookings that hotels aim to maximize. There are booking engine providers that charge a monthly fee, commission, or a combination of both. Direct distribution channels like booking engines allow hotels to collect valuable customer data for future communication.
Additionally, hotels can include relevant information about their accommodations on the website, as well as cross-selling opportunities to increase revenue and personalize the customer experience, such as offering massage services in spa spaces.
With the increasing importance of mobile devices for travel research, it's essential for booking engines to be fast, secure, and responsive to mobile devices. Connecting the booking engine to metasearch providers like Google Hotel Ads can also improve visibility and attract more bookings.
GDSs (Global Distribution Systems) like Amadeus, Travelport, and Saber connect hotels, airlines, and other tourist service providers with travel agents worldwide. This ensures a hotel's global presence and increases visibility.
For hotels targeting corporate markets, GDSs are especially important. Many companies rely on GDSs as their primary booking method because they allow for easy access to hotels, flights, and car rentals in a single interface.
Wholesalers like HotelBeds act as intermediaries between hotel suppliers and travel agencies/tour operators. They purchase multiple nights of hotel rooms and negotiate rates before selling them to OTAs and travel agents. The advantage of this distribution channel is that it helps hotels maximize their occupancy and guarantees a certain number of rooms sold. However, the profit margin is not typically the best, and it shouldn't be the only distribution channel hotels rely on. In recent years, these distribution channels have become digitized and moved away from static tariffs.
Metasearch sites like Google Hotels, Skyscanner, and Trivago aggregate hotel options and prices from various sources, making it easier for customers to find the best deal for their desired location. Google has reported a yearly increase of around 60% in searches for "best place to stay at..." highlighting the importance of metasearch in the hotel distribution landscape.
Hotels and OTAs may be charged commissions by metasearch sites, either per booking or per click on the ad. In recent years, hotels have been increasingly investing in metasearch engines, as the return on investment (ROI) has been higher than in other advertising campaigns, both offline and online.
Increased reach: By being present on various online distribution channels, hotels can reach a wider audience, including international travelers and potential guests who might not have heard of the hotel otherwise.
Increased revenue: Online distribution channels provide an opportunity for hotels to increase their revenue by selling more rooms, especially during peak seasons when the hotel is likely to be fully booked.
Cost-effective: Online distribution channels are generally more cost-effective than traditional advertising methods, such as print and television ads.
Competitive advantage: Being present on a variety of online channels gives hotels a competitive advantage over those who rely solely on traditional distribution channels.
Flexibility: Online distribution channels allow hotels to adjust their rates and inventory in real time based on market demand.
One of the most effective ways to improve your online distribution is to optimize your website for search engines. This involves using relevant keywords, providing high-quality content, and ensuring your website is mobile-friendly. By optimizing your website for search engines, you can increase your visibility and attract more direct bookings.
Dynamic pricing involves adjusting room rates based on market demand. By using dynamic pricing, businesses can optimize revenue and avoid overbooking during peak seasons. This strategy allows businesses to adjust their prices in real-time based on market demand, which can help them stay competitive in the industry.
To reduce reliance on third-party platforms and increase direct bookings, businesses can offer incentives such as discounts or complimentary amenities to customers who book directly with the hotel. By offering incentives, businesses can encourage customers to book directly with them, which can help them save on commissions paid to OTAs.
Online reviews can significantly impact a business's reputation and influence booking decisions. It's essential to monitor and respond to reviews promptly and proactively address any issues raised by guests. By managing online reviews, businesses can build a positive reputation and attract more bookings.
Partnering with OTAs can increase a business's visibility and attract more bookings. However, it's essential to choose the right OTA based on the business's target market and commission structure. By partnering with OTAs, businesses can reach a wider audience and attract more bookings.
Metasearch engines like Google Hotel Ads and Trivago allow customers to compare hotel rates and availability from various sources, including OTAs and the hotel's own website. By being present on these platforms, businesses can increase their visibility and attract more direct bookings.
Providing a seamless booking experience is essential to attract and retain customers. Businesses should ensure that their website is user-friendly, provides accurate information, and offers a secure payment gateway. By providing a seamless booking experience, businesses can increase customer satisfaction and reduce the likelihood of booking cancellations.
To thrive in the highly competitive hospitality industry, it's essential for hotels to establish a robust online distribution strategy. Being present in various online distribution channels not only maximizes occupancy and revenue but also increases brand awareness and enhances the guest experience. However, managing online distribution can be challenging without the right expertise and tools. Fortunately, Hey!Travel offers innovative solutions such as Hey!Booking Engine and Hey!Channel Manager to help hotels efficiently manage their online distribution directly and across unlimited channels, respectively. With Hey!Travel's solutions, hotels can ensure a seamless and personalized booking experience for their guests, ultimately leading to increased revenue and customer satisfaction.
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