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OTA no longer a 4-letter word
October 3 2013

Hoteliers finally are realizing there is money to be made via the OTA channel, so long as you manage it efficiently.

Highlights
  • Hoteliers are realizing OTAs are just another channel to yield.
  • Overreliance on OTAs can lead to problems.
  • English hotel guests can be restrained in the direst of circumstances.
     

I’m still trying to shake a month’s worth of jetlag out of my system, but I’ve detected a significant shift in thinking in how hoteliers are viewing online travel agencies.

In every city I visited last month as part of my Hospitality Tour 2013 (Nashville, Tennessee, to Las Vegas to Phoenix to Orlando, Florida) I heard the same refrain over and over and over again.

“OTAs are just another channel for us to leverage and yield. And we’re seeing record amounts of revenue flowing through our OTA channel.”

In fact, I heard several people during the course of the past month say they are making more money through their OTA channel than they ever had.

This is quite a departure in thinking from where the industry was a few years ago. Judging by how OTAs were discussed at conferences back then, you’d have thought OTA executives treated hoteliers in much the same way Biff treated a young George McFly in “Back to the Future.”

Hoteliers have a number of legitimate concerns about OTAs; there’s no getting around that. For instance, hoteliers fear giving up control of room inventory while being precluded from offering discounts on rooms that exceed what appears on the various OTA sites.

I’m not out to minimize these reservations about OTAs, but I will say this: Any distribution channel, when utilized incorrectly, will cause problems. Part of revenue management is, as the song goes, knowin’ when to hold ‘em, knowin’ when to fold ‘em, knowin’ when to walk away and knowin’ when to run.

In fact, that statement I mentioned above was nearly always followed up with:

“As long as we remain disciplined and don’t give too many of our rooms over to the OTAs, we’ll be fine.”

Slowly but surely, it looks like people around the industry are catching on that OTAs are, in fact, just another channel to yield and accounting for them appropriately as part of their overall revenue management strategy.

I’m not saying officials from Expedia will be receiving a standing ovation at the Americas Lodging Investment Summit anytime soon, but I don’t think they’ll be booed off stage either.

Tweet of the Week

 

This story, as you might imagine, brings forth a lot of questions. (Dude, I know it’s a 4-star hotel and all, but you didn’t lock the door?) But perhaps my biggest question centers around the actions of the Manchester, England, Police Department, of which I am sure aims to the highest standards of professionalism, public safety and peace-keeping.

That said, I want to make sure I understand the situation here: A man calls the police department to report that another man, naked and drunk, has, without invitation, climbed into his hotel bed. And the police don’t only bother not to show up, but also they tell the poor scarred-for-life guy no crime has been committed?

Disagree. A crime of the highest order has been committed. In fact, the Manchester Police should be grateful all the caller did was tell the invader, in words this publication will not allow, to leave. Seems to me there could have been several charges to come out of this—all of them justified.

Email Shawn A. Turner or find him on Twitter.

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