FACT: online travel agencies are growing fast, over 76% of online bookings happen via OTAs.

In the research, made in 2015, it was stated that online channels are growing even faster than the total European travel market. It is not a surprise – OTAs are considered the largest spenders on online advertising. They are moving forward very fast, improving rapidly and their technology implementation is absolutely fantastic. These OTAs efforts to attract more clients directly benefits hotels – it is an easy way to improve occupancy, without putting much effort and resources into advertising.

However, for hotels, the success of online travel agencies represents both an opportunity in terms of increased sales and promotion and at the same time a threat because of the huge commissions they need to pay and the rising competition for customers’ loyalty. That is the reason why small independent hotels have a love-hate relationship with OTAs. It can help you get more bookings, but this obviously comes with a price tag.

So…Do you know what the cons of working with OTAs are?

From the first moment you become a partner of OTA (online travel agency), you have to be aware of the fact that you hand over the control of your business and you downsize the chances of getting direct bookings. And here are just a few reasons why it’s happening.

#1 Lack of engagement & relationship

There is no relationship between you, as hotelier, and OTAs – they market your product and sell it to benefit themselves. YOUR customers are their no.1 priority, NOT YOU. Even though you have a low price, the OTAs are not selling the price, they enhance the experience and the value of hotels, what makes a great opportunity for customers to get the best deals, but on the other hand, it boosts the competition for your hotel. They don’t care whether the client chooses your or your competitor’s hotel. Admit it, anybody would resent that in the relationship.

#2 Limited reputation & data control

You are not allowed to control your reputation. Since you have no impact on your reviews, you cannot manage it. So users only see traveler reviews and not the hotel response. Not good for hotels, nor for site users who don’t get the complete picture. Do you think that OTAs care about your review scores? They don’t, all they care is SALES. At this point, your hands are tied because there is nothing you can do about it.

What is more, in most of the cases you are restricted from your customers’ data. OTAs are communicating with your client directly, not you, you don’t have access to your client’s data, have no email, no address, no history on previous bookings, nothing. Consequently, you can’t create your own loyalty programs because you have no information on the client.

#3 Competitor or partner?

OTAs create competition between you and your brand, because if you want to get direct bookings, now you have to compete with OTAs.

OTAs are advertising on your hotel brand name – in other words trying to “steal” the branded searches, which is the easiest way to convert – the client already is asking for your hotel.

Here’s how it looks. Let say, a client is searching for a specific hotel in Copenhagen. Types in Google the name of hotel and here’s how everything looks:

The first results are Google AdWords ads. Of course, booking.com appears first. Let see what happens when a person clicks on it.

Here we go, 4 different special offers, NOT INCLUDING PHEONIX HOTEL.

Each time a person clicks on the booking.com ad, more staying options besides Phoenix Hotel appears, special offers, extra filters & discounts pops out. At this point, the user might end up booking somewhere else.

See? OTAs don’t care whether a person chooses you or your competitor, all they care about is SALES. Remember? This user was initially searching for Phoenix Hotel in Copenhagen…

Therefore, if you want to drive more direct bookings, you will have to put more effort to beat the competition of OTAs.

#4 Lack of fairness

Most probably you get the feeling that you put all of your efforts to keep your hotel as attractive as possible for your clients and OTA’s just benefits from it. Since they have a lot of hotels under their roof, they gain the power to control you and your bookings. You can also feel the lack of fairness when paying commissions. We all understand that it costs a lot  to reach the customers, and we totally agree that the commission fee should be charged in order to bring you a large volume of customers. BUT… Don’t you think that it’s unfair to charge you for RETURNING guests? You already impressed the customer, did your job, and still, have to pay as for a new customer. Most importantly, there is a solution for a fair trade –  to have different commission rates for new and returning customers! And again, no OTA is willing to do so! That is why we can’t say it’s fair partnership when one partner benefits more than another.

#5 Lack of power

You have to do what they tell you to do – give the best room rate and be on page no.1 or if not, be on the last page. They are forcing you to do things that are not in your plan. Also, you don’t have much power to make any impact on bookings. On top of that, they have powerful loyalty programs and there is no way you can conquer it because the customer knows he gets the lowest price. You are paying commission on top of your lowest possible rate cuts into revenue you would have earned if these people had booked directly.

Of course, it is better to be on OTAs than not to be at all, but there are much more benefits by selling directly than being dependent on them. No doubt direct sales requires a lot of time and energy, but there is always a solution – get the help from professionals.

Solution: Google Hotel Ads

OTA’s can be a great starting step for new, small hotels, but hotels have to do it on their own as well.  You put all of your efforts to keep your hotel as attractive as possible for your clients and OTA’s just benefits from your efforts. It is just not fair looking from your perspective.This is the perfect moment for Google hotel ads to step into this game. Not only it‘s a powerful tool to beat OTA‘s and get more direct bookings, but also with Google Hotel Ads, travelers will be just one tap away from booking, as they can book directly on your property’s website.

Google Hotel Ads is a huge step forward in Hospitality Industry, it is even considered as one of the most effective tools to win over your direct bookings and compete with always demanding OTAs. And if you’re not doing it by yourself OTAs is probably doing it for you at this moment. And if you haven’t checked your hotel on Google search – find out now whether you have an issue. It‘s your time to have all the attention from travelers!

Not sure what Google Hotel Ads is? Here you can find more information.