december 1, 2020 - NEWS

6 Ways to Increase Direct Bookings Through OTAs

September 2, 2020 - NEWS

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Marketing channels, specifically online travel agencies, can have a big impact on whether or not a hospitality business maintains high occupancy. So we made a list of tips on how to use OTAs to drive new customers to your booking site while keeping the cost down.

Before we go into how to increase direct bookings through OTAs, though, let's talk about what an OTA is.

What is an OTA or Marketing Channel?

A marketing channel is a system or strategy that business owners use to get a product or service to their target market. Some examples of marketing channels are online travel agencies, texting, email marketing, sales teams, social media and promotional events.

An online travel agency is a third party booking platform for hotels, airports, car rentals, inns, campgrounds and more. Some popular OTAs include TripAdvisor, Booking.com, Google Hotels, Expedia and Airbnb. Here at ResNexus, we provide a direct connection to OTAs, meaning you manage your account information and reservations from multiple marketing channels all in one place.

For guests or consumers, OTAs provide reviews, room listings and other nearby booking options. For hoteliers, OTAs provide exposure and an online presence in exchange for a commission fee.

But do you really need to use a marketing channel like an OTA? If you don't want to miss out on potential sales, then the answer is yes.

Why use an OTA?

Although using an OTA comes with commission fees, ranging from 3% to 20%, the online visibility you gain from using an OTA is worth it. They are great for attracting new guests or clients. The websites of OTAs are one of the first to appear on Google, and OTAs spend billions in advertising annually. Think of using an OTA as part of your advertising budget.

Authors of a 2020 study published by Sustainability wrote on page one, "Almost 75% of consumers who booked rooms on a hotel's website had visited an OTA prior to making the reservation." The authors called this phenomenon the "billboard effect," where hotels and other hospitality businesses will see more direct bookings after customers look at the business' listing on an OTA's website.

"OTAs can be considered a form of e-commerce," according to a 2020 study published by the International Journal of Hospitality Management. "We anticipate that visibility of the apps will positively impact intentions, or conversely, reduce the barriers that impede purchase intentions." This means that OTAs with high visibility can overcome customer barriers to get bookings.

Now that you understand why using a marketing channel is important, let's look at how to use marketing channels to your advantage.

How to maximize visibility on an OTA's website while minimizing cost

1. Determine your target audience

Before even considering different OTAs, you need to figure out what kind of people are trying to book stays at your RV resort or hospitality business. Do your guests like the outdoors? Or do they like reading a book while looking out at the city? Perhaps they're just looking for a shorter transit to a big tourist attraction like Disneyworld.

That's up to you to figure out, whether by looking at reviews on social media or asking your guests directly. Once you have figured out who wants to book with you, start personalizing the content on your website and on the OTA's website to match your target audience's needs.

Some marketing strategies for your website could include:
Blog posts - if your guests like to hike, write an article about nearby hiking trails for them to explore
Marketing emails - send out an email with a discount code for an upcoming event
Social media posts - post about something one of your guests did for fun or remind your guests of when your busy booking seasons are
Text messaging - find out how your business can improve by reaching out to recent guests via text

According to a 2019 study published by Eleftherios Thalassinos, having a specific target market can allow businesses to compete with larger industry entities that attract multidirectional audiences or a broad range of guests with various wants and needs.

2. Connect with the right OTAs

Each marketing channel has a different outreach and demographic. Fotexr example, TripAdvisor found in its TripBarometer 2016 report that 46% of respondents were older than 55 years old.

However, Airbnb found in its "New Data: The Airbnb Advantage" article that, "in 2018, 58% of its hosts and booking guests around the world were millennials," who are 24 to 39 years old (according to Pew Research Center President Michael Dimock).

So before jumping into the world of marketing channels, determine what marketing channel fits you and your target audience best. Compare the different fees of each OTA. Read reviews about them and figure out which ones are most visible online.

If you're already connected to OTAs, revisit your connection with them and see if it's still beneficial to you. Your audience may have moved on from using a certain marketing channel, which means you're not using your money to its fullest.

3. Have a website that looks just as good or better than an OTA's website

Considered another aspect of creating a positive online reputation, having an updated website that's aesthetically pleasing and trustworthy can be a big factor in whether or not your guests want to book directly with you.

According to a 2020 survey published by the Pew Research Center, eight-in-ten Americans rely "a lot" on their own research before making a major decision, and 46% of those Americans turn to digital tools to do so.

So if your digital tool, i.e. your website, goes against their gut instinct or seems insecure, they may see your brand as unworthy of their time or money. If your website isn't attractive or easy to use, your guests will go back to the OTA's website, which means you're missing out on sales that don't require a commission.

You shouldn't neglect your website because good websites give guests a place to shop. Learn how you can keep your website updated here. Or if you're in need of a website, you can get a demo from us here.

4. Give guests incentives to book direct

Depending on your target audience, there are various ways you can incentivize your guests to book directly with you. Some examples include:
Bundles - free rental car or plane ticket included with booking direct
Loyalty program - reward your guests for coming back to your hotel or hospitality business
Comparison chart - show your guests the amount of money they're saving by booking direct versus booking with an OTA
Cancellation fee - cover the cancellation fee if they book directly with you
Group discount - offer a group discount if they book on your website

You could even only list weekday bookings on an OTA's website, so guests will be curious about weekend bookings and look into your website.

Ideally, you would mention these perks on the OTA's website and how a customer can get them. If the OTA is restrictive about mentioning direct booking or providing other incentivizing information, you could list your phone number and suggest that guests call you to see what discounts are available.

TripAdvisor recently came out with a tool called Business Advantage, which allows businesses to list their website, email and phone number directly on TripAdvisor's website to compete with OTAs. You can learn more about TripAdvisor's tool here.

5. Improve your online reputation

An easy way to interact with customers is through social media. You can keep clients up to date on upcoming promotions or events without having to call them individually, and you can keep your brand current without spending any money.

"Social media plays a significant role in companies because it changes the way that businesses operate," Walden University doctoral student Anita Smith said in her 2018 study, "and it helps employees interact more with their customers." One of Smith's respondents in the study mentioned that social media "can help you more effectively meet clients' needs and bring your business into parity with competitors."

Some of the social media platforms that are popular right now are YouTube, Facebook, TikTok, Twitter and Instagram. Choose the one(s) that best fit your target audience. For more information about social media and how it can grow your business, check out our webinar.

6. Focus on the repeat guest rate. Prioritize great customer service

OTA's are not good for repeat business. This is where you can take your initial investment and make it shine. Emphasize and utilize your customer service skills. Help your customers understand that directly booking with you ensures a personalized experience and easier refunds. This will help them want to book with you again.

Guests will feel more comfortable knowing who they're staying with and how an owner runs a bed and breakfast or campground over trying to book with a faceless OTA. Even an increase of 5% for a return guest rate, thanks to your good customer service practices, can mean a lot more money in your pocket annually.

After looking through each tip in detail, here's an overview of them.

In Conclusion

Here are the six tips you can use to increase your direct bookings via OTAs:

Determine your target audience
Connect with the right OTAs
Have an attractive landing page
Give guests incentives to book direct
Improve your online reputation
Use customer service to get a better return guest rate

Avoiding OTAs is not an option, unless you have a long reach through word of mouth, a high ranking website or your own social media. If you're unsure which OTA tips to go with, try a few out at a time and see how your bookings fare.

For more OTA tips, check out our webinar.

Sources

Airbnb. (2019). "New Data: The Airbnb Advantage."

Bondarenko, V., Efremenko, I., Larionov, V. (2019). "Marketing strategy for hotel and
tourist complex companies." Eleftherios Thalassinos.

Dimock, M. (2020). "Defining generations: Where Millennials end and Generation Z
begins." Pew Research Center.

Guo, Q., Anderson, C., Dong, J., Zhao, P., Ji, Q. (2020). "Coordination Contracts for
Hotels and Online Travel Agents." Sustainability.

Smith, A. (2018). "Strategies for E-Commerce Adoption in a Travel
Agency." Walden University ScholarWorks.

Talwara, S., Dhir, A., Kaurde, P., Mäntymäki, M. (2020). "Barriers toward Purchasing
from Online Travel Agencies." International Journal of Hospitality Management.

TripAdvisor. (2016). "TripBarometer 2016."

Turner, E., Rainie, L. (2020). "Most Americans rely on their own research to make big decisions,
and that often means online searches." Pew Research Center.

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SEE WHY RESNEXUS IS TRUSTED BY THOUSANDS OF PROPERTIES

SCHEDULE A TOUR

CALL US 385.292.1518