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Alternatives To OTAs

Hoteliers Continue To Work Toward Getting Consumers To Book Directly

Wednesday, August 23, 2017
Steve Pike
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Hotel and resort guests might be the ultimate creatures of habit. They know what they like in lodging, and for the most part, they know where to get it. Online Travel Agencies (OTAs) such as Expedia and Travelocity have made it easier for travelers to “one-stop shop” to find and book accommodations.

OTAs also have helped hotels and resorts fill rooms that might otherwise go empty. That’s good for business, but the hotelier/OTA relationship has always been contentious.

Hoteliers, said Michael Tall, president and COO of Charlestowne Hotels, “complain about OTAs and say they cost too much. But everyone uses them in ways that they have for a long time.

“It’s our job as a hotelier and as a management group to make sure when (travelers) are searching for a hotel that fits within their traveling preferences, that our website comes up for that hotel as opposed to just finding us on an OTA.”

Charlestowne Hotels, based in Mt. Pleasant, SC, is one of a growing number of hotel management companies and ownership groups that have made significant pushes into maximizing their business through OTAs. The Charlestowne Hotels portfolio includes more than 41 hotels in 12 states, including such renowned properties at The Spectator Hotel in Charleston, SC, and The Collector Luxury Inn & Gardens in St. Augustine, FL.

“We have a saying,” Tall said. “Our hotels are profitable when we utilize OTA’s to grow revenue and not our acquisition costs.

“The various ways we do that is though digital campaigns. You need to retain bookings on your website and target those who land on your website who are in a shopping mode.”

The results, according to Tall, speak for themselves. Based on internal data compared against nationwide data from STR, Tall said independent hotels managed by Charlestowne Hotels earn direct bookings at three times the national average, resulting in a mix that is 76 percent direct and 24 percent OTA.

“A lot of our hotels actually are moving to display third-party OTA rates on our website to hopefully prevent people from leaving our website and letting them know our website has the lowest rate. There is no need to shop anywhere else,” Tall said.

“We started displaying Trip Advisor reviews on our websites, because we knew people were going to go there anyway so we might as well give them that without leaving our sites. There are various methods we have incorporated to try to keep people on our site and train them that they are going to get the best rates on our website. They can use our sites as ‘one-stop shops.’”

But that doesn’t necessarily mean hoteliers need to abandon their relationships with OTAs. Far from it, according to Jay Spurr, director of sales and marketing for White Lodging Services, which manages more than 165 hotels across the country.

“I have a strong belief that we have to partner with the OTAs,” Spurr said. “I believe one can’t truly be in business without the other. We need to work closely with each other and look at the agreements to make sure it’s a win-win for each side.

“We understand the buying behavior of many of our guests. Our goal is for them to buy direct. That’s what you’re hearing more and more across the industry, but we still have to maintain a strong relationship with the OTAs. I don’t see them going away. I just think we all need to work together better.”

Cari Farinas, director of marketing at Trump National Doral in Miami, says that while the famed resort’s business hasn’t changed with OTAs the past couple of years, “OTA consumers have gotten very savvy. They’re very knowledgeable in what they can buy today versus tomorrow.”

In that regard, Farinas said, OTAs remain a “necessary evil” on the bookings side of the business, even though guests can book direct and get the same price, as well as the ability to book specific packages, for example spa or golf, that many OTAs don’t offer.

“It’s really the priority of our leadership team now to stay connected with the OTAs and see what are the best opportunities,” Farinas said. “We’re in Miami, so we have to work closely with the OTAs to be presented in the top ranking.”

Credit
Steve Pike
Hotel Interactive® Editorial Division

Bio: Steve Pike is an award-winning golf writer and author who helped define golf business reporting in the early 1990s as the first Golf Business Editor for Golfweek magazine and later at Golf World and Golf Shop Operations magazines for Golf Digest. Pike further pioneered this genre at the PGA of America and Time Warner as the golf business writer and editor for PGA.com. He started in newspapers more than ...
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