HOTEL & OTArelationship not wedded bliss

The situation between hotels and OTAs is a precarious one.An Expedia official denies that the company forces hotels to provide a certain rate.TravelClick advises clients to get no more than 10% of annual occupancy from OTAs. F.N.E

Online distribution strategies and competition: are the global hotel companies getting it right?

The internet has significantly changed the ways hotels distribute and price their products.

The imminent success of online intermediaries caused financial problems for hotel chains since online travel agencies offered better prices than the hotel brand websites.

The existing literature on hotel online distribution has focused on pricing strategies and room availability issues for different segments of hotels.

OTA WHAT IS IT?

An online travel agency (OTA) specializes in offering planning sources and booking capabilities.

OTA have got everybody so scared, because they’re so aggressive about their tactics.Being a big company hotel, we rarely get bullied by the OTAs in regards to pricing or running promotions. Where the bullying really occurred was when I was with independent or smaller company hotels that were more dependent on the OTAs.The OTAs are no more or no less than what we have made them. …We have no one to blame but ourselves.

THE BIGGEST OTAs OF THE MARKET:

Voyages-sncf.comExpedia, including Expedia.com, Hotels.com, Hotwire.comSabre Holdings, including Travelocity, lastminute.comOpodoPriceline.com Orbitz Worldwide, Inc., including Orbitz.com, CheapTickets, ebookers

OTA &HOTEL RELATIONSHIP

THE POSITIVE:

- Optimization for hotel in communication and marketing with the partnership of OTAs.- Increase revenues by OTAs-viewing customers.- Packages and promotions to attract the customers.

OTA &HOTEL RELATIONSHIP

THE NEGATIVE:

-Expensive commission rates are really a problem.(OTAs booking can be >20%!)- « The big fish eats the little fish »: the biggest hotels can easily compete and are in a strong position.- By the amount of hotels on OTAs, customers are in a forest of informations.- Difficult control and high competition.

F.N.E