There is no disputing that 2015 was the year of disruption in the hotel booking space, particularly with online travel agents. Massive consolidations have resulted in the creation of several mega-corporations while new booking options continue to pop up every few weeks.
Our first Travel Trend focused on emerging travel segments. This week, we’ll explore Disruption in the OTA space.
Here is what 2016 has in store for OTAs & Metasearch sites
1.) Direct Booking Push
Hotels are tired of being pushed around by greedy OTAs and are using creative marketing campaigns to reduce reliance on these revenue gobblers.
Marriott, for example, launched an entire campaign earlier this year called “It Pays To Book Direct” complete with TV spots and carefully managed social posts and ads. The campaign send such a strong message that the brand later issued an apology to “clarify” the messaging, reassuring their strong relationship with online travel agents.
Additionally, travel startup TripTease is making waves with a new technology that features a price check popup on a hotel booking engine that guarantees a best rate by booking direct, almost eliminating the need to price shop across the web. This move was a direct stab at OTA and meta search sites and created such a debacle that Booking.com actually sent hotel clients a letter ordering them to remove the widget from their booking engine, citing inaccurate rates and unlawful practices to acquire pricing information.
From a value perspective, hotels are also making more of an effort to communicate the perks of booking direct and to push brand loyalty. Some brands are offering benefits like free wifi or complimentary breakfast for direct bookers while others are developing native apps to drive repeat business. Major brands like Marriott and Hilton already have apps and smaller chains and even independent hotels are following suit.
There’s no questioning the fact that, while online travel agents and meta search websites are an important part of the overall hotel marketing picture, hotels are ready to cut some cords when it comes to relying on those referrals for bookings and are working diligently to push direct sales instead.
2.) Instant Book
OTAs are continuing to think of more ways to persuade users to book via their websites and the rollout of “instant book” features proves just that.
TripAdvisor was the first in the OTA / Metasearch space to introduced the instant book feature in November 2014, a move that shook things up for website searchers and advertisers alike.
Google followed suite in July 2015 with their “instant book” feature through their Hotel Ads platform. The move was unannounced and rolled out without much hype or red carpet coverage but represented a huge change in the hotel booking game. Now, a searcher can book a hotel without leaving Google!
The war between hotels and OTAs / Metasearch sites wages on and shows no sign of ending any time soon. As hotels fight for direct bookings and to manage their rates effectively, OTAs will continue to use their mega-website SERP coverage and complex understanding of user experience to their advantage.
Fortunately, there are several strategies your hotel can execute to get your direct bookings back. Bidding on brand terms, showing honest reviews on your hotel website, and proper rate management are all easy ways to remain competitive in the cutthroat booking market.
3.) The Sharing Economy
“The sharing economy” is another buzz phrase that has been thrown around a good bit over the last year. The concept of sharing in the travel space can credit exponential growth to a small sub-set of companies that coordinated brilliant and highly successful marketing campaigns that are truly changing the way that people think about travel. Key sharing economy players in the travel space include:
- Airbnb – A brand that most tech savvy-travelers are familiar with, Airbnb is a San-Fransisco based company that connects homeowners with a spare room or house with travelers looking for more unique and homey lodging options.
- Uber – Another highly recognizable name in the travel space among tech-savvy consumers, Uber is shaking up the traditional taxi saturated market with a ride alternative. Uber utilizes an interesting demand-based pricing structure and has a very user-friendly app that has generated popularity among the younger segments.
- Vayable – A newcomer in the travel sharing space, Vayable boasts being “a global platform for real-life experiences”. The goal of Vayable is to solicit and distribute high-quality user-generated content to help travelers get a first hand feel for a destination via locals.
What do these up and coming companies mean for hotels specifically? Times are changing and people are seeking alternatives to the traditional way of doing things. Specifically for hotels, if one is seeking a unique experience or a great rate he or she might use booking alternatives like Airbnb to search for and book a stay versus booking with or staying at a hotel.
What can hotels do to combat this trend? Having a unique identity as a hotel and then showcasing that uniqueness via your hotel website and marketing collateral can differentiate your property and show how you are not “just another hotel”. Offering a loyalty program or discount program can also further differentiate your from others and can start establishing repeat business. Additionally, expert rate management should ensure that booking directly with your hotel is the best way to get the lowest rate to start training your audience to come back to your site versus shopping around.
What are your thoughts on disruption in the OTA space? Do you see these trends changing the future of online agents?