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Get Out of the OTA Trap

Here are some great strategies to wean yourself off the OTAs.

Wednesday, December 09, 2009
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Maximizing revenue through online channels is keeping revenue managers on their toes. And these days it’s more challenging than ever, as increasingly savvy consumers are finding it easy to suss out the best deals online.

So it’s up to hoteliers to find ways capture consumer attention through unique ways to immunize themselves from commodity pricing, while also weaning themselves off Online Travel Agencies (which we discussed in an article last week, available here).

Though it may seem daunting, there are ways for hoteliers to increase their web presence and the likelihood that consumers will book directly through their proprietary booking channel. At the HSMAI’s Digital Strategy for Travel Marketing & Distribution Conference held this week at the Wynn Las Vegas, experts discussed this increasingly onerous issue.

“Consumers have control, but they are seeking out exciting experiences, and they are unable to get that through interaction with Online Travel Agencies (OTAs),” said Aleck Schleider, VP of Media Strategy and Services with TravelCLICK. “They are looking for robust imagery to be spoon fed to them for them to make the right choice. However, they will look, compare prices, but in the end it comes down to the experience they’ll have when they make the decision to buy.”

Schleider is saying there are ways for hotels to curb the OTA habit, but to make it happen requires a multi-pronged approach.

First, it’s the property’s website itself that must be scrutinized, says Jennifer McMahon, Director of Sales & Marketing with the Charles Hotel in Cambridge, MA. “A hotel must have a compelling, visually dynamic website. It means everything to get people there, keep them and convert them to a purchase,” she said.

After a great website is in place, Karen White, VP marketing at Squirt Gun Media Group, said setting up an affiliate program is a great way to boost revenue. Affiliate programs allow hotels to post ads on websites featuring content aligned with a hotel’s location, aesthetic and experiences. These partner sites are typically paid only after a guest stays at the hotel and it’s usually at a lower cost than an arrangement with an OTA. They’re also 43 percent more likely to convert than through other referral methods, said White.

“The consumer is looking for direct deals or value-added incentives. They do want to buy direct from you but are looking for the best deals you, the hotel, has to offer,” said White, echoing Schleider’s sentiments that a strong program will include value-added messaging and experience-driven messaging .

She also said affiliate programs allow you to be more creative and try out different calls to action since you don’t have to pay upfront for your messaging. Some companies she suggested launching affiliate programs with are UPromise, FatWallet and MyPoints.

“Always remember, affiliate marketing is about incremental sales. It’s about people looking for foodie vacations, girlfriend getaways, golf vacations, gay travel, and holiday travel. You need to see where you are focused and then look to where you do not have a presence,” said White. “This gives you an opportunity to market your hotel to everywhere consumers are looking for your brand.”

She also suggests that, when a consumer clicks through your ad, you have the link go directly to a bookable page, not the hotel’s homepage. Other strategies include inviting publishers to experience your hotel or resort, and using social media to drive interest.

Another strategy that must be employed is search engine optimization, said Eric Richmond, managing director, with Expert SEO Consulting.

There are two search options for hoteliers to participate in: paid or nonpaid. Both have their advantages and disadvantages, said Richmond. While nonpaid –also called organic or natural search - is more trusted by consumers, paid search can make an immediate difference to the bottom line. But it can become quite expensive since it requires bidding on keywords, a process that can be difficult to manage. He also warned that when the spending on paid search stops, so does the traffic to the hotel’s website.

“You could spend a ton of money on a PPC (price per click) campaign. Natural search is more cost effective but you have to spend more upfront to get it done right. But over the life of website it will pay off. People tend to have a higher level of trust for organic listings than paid listings, but it requires strict adherence to best practices to be most effective, and changes can take up to three months to show up.”

Finally, Emily Smith, YouTube specialist, Travel Vertical with Google, said the power of online video as a sales tactic is growing. “There is a lot of buzz on video and it can get pretty confusing. It’s the next big thing to drive demand sufficiently and to create desire for your properties,” said Smith , adding that 61 percent aren’t sure where they want to go when they start the research process, and that video can be a big influencer.

“It is not just about frequent travelers; it’s gone from zero to mass market in three years. People watch more than two hours per month of video online and it’s time to engage consumers online beyond text. Travel markets are just now beginning to leverage the power of video, and marketers will get more sophisticated during the next year,” said Smith.
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